The Ventura Ventures Technology Center (V2TC), a high-tech business incubator for Ventura companies, officially launched a new round of business ventures last month and is currently home to 13 technology start-ups, most of whom are Internet companies. The goal is to create a network of executives, investors, universities and economic development professionals to help the entrepreneurs succeed. The incubator is a concerted effort by the city to inject growth into the economy and help bolster the city’s job market with high-tech, green jobs.
Mary Anne Rooney, program director for the Ventura County Economic Development Collaborative, said she applauds the leadership within the city for supporting this business program.
“Every city should support small business to help the city grow and create more jobs, which translates to a better quality of life for the community,” she said.
Now the headquarters for the new Google Fiber for Ventura Campaign, which will bring ultrahigh-speed Internet access to Ventura, V2TC is in the spotlight as the city has become the first in California to gain its City Council’s approval for responding to Google’s request for information.
The Ventura incubator has been around for several years, but has just begun the process of putting together a group of businesses that will occupy the space for the next couple of months. Part of the problem of keeping a full incubator is that these companies are usually start-ups, which means they are constantly moving and growing, sometimes going out of business altogether and sometimes getting so big they sell to large companies.
In 2003, the city of Ventura created an economic development fund to create jobs. Alex Schneider, now the CEO of V2TC, was able to help direct policy that created the San Buenaventura Jobs Investment Fund, and the incubator was born. It put the word out to ventures capital firms and was able to secure funding to get several high-tech start-ups off the ground and revamp one floor of the building behind City Hall to entice seasoned technology CEOs and entrepreneurs to join the incubator.
These companies foster a creative atmosphere in a high-tech and newly refurbished environment, where they have more than just the latest technology as resources. They also have the experiences of other local entrepreneurs trying their hand at similar businesses. Some have tried before and failed, and others have been very successful with their previous venture and just want to try something new. One of the best things about the creative and intellectual environment of the incubator is the mentorship aspect of all these start-ups working closely together under one roof.
The incubator creates a collaborative ecosystem of start-up companies and entrepreneurs, who can network, share ideas and help one another grow and build.
Local venture capitalists like DFJ Frontiers and Peate Ventures have been important partners in helping several of these companies launch. Dan Peate of Peate Ventures, which manages the San Buenaventura Jobs Fund, says they invest in approximately two to four companies out of every 400. According to Peate, the key to getting an idea off the ground and securing funding for it is the ability to sell an idea and get other people excited about it.
Some of the best resources available to first-time business owners are these “serial entrepreneurs,” business owners who take their expertise in an area, along with the money or experience from their last business, and turn it into a new project. Even with the low-rent space, brightly colored rooms, great architecture and access to state-of-the art technology equipment in the incubator building, the best perk may be the fellow renters who can share some of their wisdom. These brilliant minds, novice or seasoned professional, have been working on their projects long enough to know the do’s and don’ts of creating a start-up and have offered to come up with their best advice on how they’ve managed to turn their great ideas into successful business ventures.
NetPlenish: Take the stress out of comparison shopping
NetPlenish.com is one of the companies founded by a seasoned veteran of technology start-ups. Dave Compton founded a biotech firm called Aqua Scientific and was the CEO of a dotcom company several years ago. Through his biotech firm, which he started in Ventura, he has generated a large amount of venture capital and has been able to fund his current project, although he will begin taking on investors at the end of this month. Compton left Aqua Scientific in July 2009, wanting to do another high-tech start-up. When he began looking for a spot to start his new company, he was originally thinking he would have to commute to Los Angeles or even the Bay Area, but as a Camarillo resident, was thrilled to find out the Ventura Incubator had a vacancy.
Compton’s new venture, NetPlenish.com, has combined two popular computer applications: price comparison search engines with an autoreplenishment feature. It automatically searches the Web to find the lowest prices for a particular brand.
“It’s a really simple concept because you’ll always pay the lowest price and never run out of the things you use most often,” says Compton. All transactions are done through NetPlenish, so you aren’t redirected to another site as with other price comparison sites.
After making the first purchase through NetPlenish and choosing the rate at which it will be replenished, the user can “net it and forget” until five days before the next shipment is ready to be sent. An e-mail will then go to the user with information about where the product is currently found at the lowest price, including shipping, and then the user has the option to speed up the transaction, confirm it, slow it down, or suspend it until further notice.
NetPlenish is still in the testing phase and will be open to the public later this year. Compton says this category of business is a $50 billion industry, but there’s only been about 5 percent penetration in the online market, which few people have been able to tap into. It’s an especially important market with the younger demographic that is becoming much more tuned in to buying online. The ability to shop by phone or PDA is where NetPlenish is headed so that, eventually, notifications and confirmations will be sent by text message.
Compton advises anyone who has a really good idea and want to start a business that it’s important to protect that idea.
“You want to patent your idea but you can’t put your lamp underneath a bucket either,” he says. “It’s also important to get your idea out there, and you don’t want to be so afraid of someone else stealing it that you’re not getting it out there enough.”
He also says it’s important to know you can’t do it all by yourself.
“Whether you do something like joining an incubator like this or finding a co-founder, I think the biggest trick is to try to find good people to help you who will lead you in the right direction.”
Lottay: No more useless gifts
Lottay.com, a gift-giving Web site that allows users to send money in a creative and thoughtful way, moved into the incubator in January of this year. Lottay is changing the way people think about giving cash as a gift, by allowing users to send money through the site using a PayPal account in a more personal and flexible way. Users add a creative card that specifies what the money is for. It’s useful for gift-givers who want to send a thoughtful gift, small or large, like $3 to a sister or friend for a cup of coffee to say you’re thinking of her or $10 to your mom for a movie you think she’ll enjoy. One group of friends on the site raised more than $3,000 for a classmate’s new nonprofit, so it covers a wide range of needs.
The company is currently made up of six employees, including founder Andy Elliott and CEO Harry Lin, three programmers and a designer. The helpline and customer service number on the Web site is currently Elliott’s personal cell phone number. But the company is no small-time deal.
There are thousands of members who have uploaded wish lists, and the site’s blog, “My Worst Gift Ever,” is flooded with rants about the horrible gifts people have received. Elliott says the idea came from having given a very bad gift to his wife, a drill for their anniversary, for which he is still suffering the consequences. The company seeks to save others from a similar fate by offering an alternative to wasting money on things people won’t use by helping give and receive things people need or want. Lottay is launching a Facebook application soon and will eventually be adding a mobile application as well.
Lin was the general manager of Evite for two years and was trying to secure funding for his own start-up. When he went to investors with his idea, they had a better one. They asked if he would be interested in partnering with Elliott, also president of Lottay, who had been working on a prototype of the site.
Lin’s best advice to those wanting to take their ideas to the next level is first to see if other people think it’s a great idea. Then go out and find people who will use the service.
“Venture capitalists don’t often give people money to start their idea anymore. Investors want to see some working version of it first to know that people will use it,” says Lin.
In this economic climate, investors want the closest thing to a sure thing. There are a lot of great ideas that never get off the ground because it’s so hard to put a team together to execute the idea, and few people are lucky enough to find an investor anymore who will take a risk on an idea in the hopes that the right people will come together to make it work. “It’s a very fine line because it’s difficult to get the product off the ground without the right team, but without funding, it’s hard to pay a great team,” he says.
Securing the right team is also a unique challenge in the current job market because, when the economy is doing well, people are more willing to take a risk on something fun that they believe in. Now, people worry that if the start-up doesn’t work out, they may not have a job to go back to. And because investors only give a little bit of funding at a time and want to see proof of growth and improvement, it’s a very demanding job.
Elliott says people should think long and hard about how much they are willing to put into their ideas because the hardest thing in the business world is to build something out of nothing. “You have to be a little bit crazy and very shrewd and rational,” he says. “People should also know that there are a dozen or more entrepreneurs in the incubator building who would be happy to advise anyone who is serious about turning their idea into a business.”
Geodelic: What you need at your fingertips
Geodelic.com is another high-tech Ventura company that has become extremely successful early on. It’s already an iPhone and Android application and is quickly becoming a popular GPS site after only about six months. Geodelic has a series of partners who are adding to the radar of the application, which is free to consumers. It gives the partners, major brands and locations such as the Hollywood Walk of Fame and Universal Studios, a chance to add what they call “on-site experiences.” When one of these listings shows up on the user’s radar, it comes with the location’s own customized content, like a guide to the amusement park, list of attractions and admission prices. It offers movie times and reviews when you scroll across a nearby theater, menus and reviews for restaurants, and it filters results by relevant listings, proximity, type of food, etc.
It’s one of the first companies to successfully combine mobile marketing with a location-based search engine. Users can see which nearby businesses are currently offering promotions or discounts to help decide where to go. Soon, it will be launching a user-generated publishing system so that anyone can publish comments about his or her experience of a particular locale, to make the content more rich and helpful to other users.
Founder and CEO Rahul Sonnad began the process of putting together a team of engineers last year, which would eventually give birth to the idea of Geodelic. He currently employs 25 people, mostly engineers and developers.
Geodelic was one of the original start-ups at V2TC and Sonnad was an integral part of the process. He is a dynamic entrepreneur and has helped to generate a lot of buzz around the incubator and has significantly helped to get it off the ground.
Sonnad worked for a few large companies such as Microsoft and Comcast, doing product design, but also has a strong background in business and engineering, which helps him to play a large role in making sure the product is where it should be. He attended Harvard Business School and got his master’s in engineering from the University of Washington. He’s extremely involved when it comes to leading the vision of the company and in its business development.
Head of marketing for Geodelic, Buddy Dillenberg, says that as a start-up, you need to be selective and make sure that you get the best talent in so that you can run very lean, which has been their model so far. The know-how with a start-up is crucial, or finding those who have the know-how. Having a long-term vision is also very important in the process of taking your idea to the next level, and you should be able to visualize where your product or service will end up in the future. He says it’s also important to find and understand your niche in the market.
“Understand what you’re good at, and then do that,” Dillenberg says.
Because there are so many businesses out there, it’s also important that people have a strong demand for your product. If your product is simply neat or just sounds cool, it’s not enough. “Perseverance and discipline are also very important; most people have one or the other but very few have both. Those that have both will be far more likely to succeed,” Dillenberg says.