Santa Monica's Silicon Beach A 'Tech-Centric' Community, Survey Says
Posted Oct. 31, 2013, 8:22 am
Parimal M. Rohit / Staff Writer
In his 2012 State of the City address, then mayor Richard Bloom coupled “Silicon Beach” with Santa Monica. Almost two years later, the Semi-Annual L.A. Startup Industry Report featured Silicon Beach as a top destination for startups.
According to the report, 35.9 percent of startups within the Los Angeles region make their respective homes in Silicon Beach. Another 9.4 percent of startups between Ventura and San Clemente are based in the West Los Angeles area, which includes portions of Santa Monica and neighboring communities.
No other location has a higher ratio of startups based in its community; Orange County, just like West Los Angeles, is home to 9.4 percent of all startups this year, while the South Bay comes in fourth place with 8.7 percent and Downtown Los Angeles rounds out the top five with 5.1 percent.
Listed on its own and not included in the West Los Angeles figure was Culver City, which housed 3.5 percent of startups this year.
The report identified Consumer Products and Services, Digital Media, Internet, IT, Mobile, and Software as key sectors calling Silicon Beach home. Among the notable startups recognized by the report were Demand Media, Lettuce, Riot Games, ShoeDazzle, Snap Chat, and SurfAir.
Although listed in the West Los Angeles category, startups Pagewoo and SocialTagg were also recognized in the report as “notable” firms based in Santa Monica.
Silicon Beach is one of the Los Angeles startup ecosystem’s “overall leaders,” the report stated.
“The fact that the three-mile stretch from Santa Monica to Playa Vista is being referred to as ‘Silicon Beach’ speaks volumes to the region’s influence in Los Angeles’ greater startup ecosystem,” the report added. “The region also has the majority of greater Los Angeles’ co-working spaces and incubator/accelerators, with at least one-quarter of each.”
On page six of the 15-page report, Silicon Beach was the first of four areas highlighted as ripe for startups to plant seeds of growth. A quote from Bloom was included here to highlight part of what makes Silicon Beach attractive to startups.
“Our technology-qualified workforce, creative workspaces and leading broadband infrastructure will keep our economy well-positioned for future growth,” the report stated, quoting Bloom.
Also highlighted on the Silicon Beach feature page was Mogreet, a mobile messaging startup launched in January 2006 by James Citron and Norm Schifman.
The semiannual report looked at startup data during the first six months of 2013.
“According to startup community website Built in LA, 94 new startups launched from January to June, with L.A. startups as a whole raising about $500 million in funding. Nine companies were acquired during that time, collectively earning more than $153 million from exits,” the report stated. “Among the greater ecosystem’s hot sectors in 2013 are digital media, software and IT, and consumer products and services, which is consistent with 2012.”
In breaking down “where the money is,” the report found 18.2 percent of available funding is in Santa Monica. That ranks third behind Orange County (29.5 percent) and West Los Angeles (25 percent), which includes areas such as Beverly Hills, Brentwood, Century City, and Westwood.
Another key element of the report was the presence of accelerators and incubators. Accelerators and incubators help provide an infrastructure for startups to grow.
According to the report, 14.9 percent of facilitators – another way of describing accelerators and incubators – are based in Silicon Beach, which is second to Orange County (17 percent).
Silicon Beach ranks first in co-working space by region.
“Co-working spaces provide tenants flexible terms (from daily to yearly), tools and resources (e.g. desks, internet and conference rooms) and a community, from the entrepreneur at the other end of the table to mentoring from experts and consultants,” the report stated.
The report found 22.2 percent of co-working spaces for startups are in Silicon Beach, ahead of Orange County (19.4 percent), Downtown Los Angeles (19.4 percent), Pasadena (5.6 percent) and the South Bay (4.3 percent).
“To no surprise, Santa Monica and Venice together house the greatest share of co-working spaces, with Nextspace, Real Office Centers and Cross Campus making the biggest waves. The region’s myriad startups and entrepreneurs keep vacancies low at its eight co-working spaces,” the report stated. “And regular networking events, conferences, launch parties, mentoring sessions and pitch opportunities at the facilities bring in an equally high number of startups and entrepreneurs from other cities.”
The report also praised this year’s Silicon Beach Fest as a key reason why Santa Monica and neighboring Venice play a significant role in Southern California’s startup space.
“The 2013 Silicon Beach Fest, which held daily activities at most of the co-working spaces, hosted about 3,000 people from around the country June 19 to 23, according to festival director Kevin Winston, up from 2,000 in its inaugural year in 2012,” the report stated.
BeGreat Partners put together the Semi-Annual L.A. Startup Industry Report. Consistent with the report’s title, The Mirror estimates a report for the second half of 2013 would be made available at some point in Spring 2014.