Southern California Needs a Web 2.0 Incubator

I have a motto that goes, “If it’s not dirty, it’s not an incubator.”

In Southern California, we have two well known incubators:

- The Digital Media Center in Santa Ana, CA: my review of it here

- And Idealab, which is a bit better; however, they’ve transitioned into a clean-tech focused lab.

What’s missing though, is a full-fledged web incubator. One that blasts music, is open 24-hours, espouses failure, innovation and launching fast. One that attracts insomniac web architects, designers and freelancers attempting to live the “4-hour work week.” Many people mistakenly think of Orange County as strictly a real-estate haven. I would, too. After all, my family, relatives and friends are mostly in real estate. Yet, there’s a dedicated, innovative following in Southern California that launches some innovative web products.

Many of these web gurus live in Newport Beach. They surf all day and code all night. It’s an awesome balance.

I’m not suggesting re-creating a Silicon Valley. After all, the Valley took over 80 years to create, and it developed over time due to dedication, laws, sweat, yuppies. greed and serendipitous success stories. If you don’t have time to sit around for 80 years, you may as well move to the Valley.

It’s been said that in order to have a solid incubation environment, one needs the following:

- An environment that espouses hard work: Whether it be due to crappy weather (like Boston), or seasonal depression (Minnesota), places that are cold, gloomy and drab tend to aggregate work-a-holics. I mean, what else is there to do, right?

Instead, I’d like to argue that this environment stands as an innovation impediment. Take, for example, the West Coast. It’s often thought of as “laid back.” That’s fine to hold that stigma; but, perhaps it’s healthier than operating as a staunch, pedantic ivy-league guy? How do I know? Because of perceived break-through technology.

Yes, money talks:

- A culutre of “fail, and fail fast” Right now Orange County doesn’t really have this feel. Rather than “fail, and fail fast,” it’s all about inhereting your spouse-in-law’s money, making some smart real-estate investments, and perhaps, make some quick money in Hollywood by mimicking Ari Gold’s lifestyle. That, or, find a career that pays well, is in a nice location and allows you to never take work home (as it will interfere with your weekend trips to Disneyland, Newport Beach, Big Bear, an Angels game or watching dominant High School Football).

- Leading universities in the area: Southern California has some of the most underrated universities in the nation: Claremont McKenna, UC Irvine, Chapman University (top 10 entrepreneurship), Cal State Fullerton, Cal Tech, Harvey Mudd, USC, UCLA, Cal Poly, University of San Diego, UC San Diego, UC Santa Barbara, Pepperdine, Loyola (I’m probably missing a lot).

Again, I think the realistic, pragmatic aproach that flows through SoCal’s veins actually enhances innovation.

Back in 2000 there were talks of an Incubator coming to Irvine; however, these plans folded. This failure rolled into the Digital Media Center, which holds the following mindset:

To be eligible for help from the incubator, a business must persuade Hoffman and his advisory board that it will offer a unique product or service, has a competitive advantage, and will create good-paying jobs.

That’s great… If you come from an I-banking, M&A or real-estate background; however, if you want to innvoate on the web, a much more organic approach should be taken. If you try and take a systematic approach to web innovation, you’ll fail every time. Things change. Fast.

The exciting, intense feeling of entrepreneurship is captured through Morten Lund’s recent talk at Le Web 2008:

You see, success on the web isn’t about competitive advantages, a 60+ page business plan, a proven team, money, or a powerpoint presentation. It’s organic. It’s about the power of people. It revolves around environment. Success on the web comes from putting bright young people in a fun, collaborative work-environment that allows them to constantly innovate in whatever style they want. Whether it be 8am in the morning or 3am while coding to blasting music.

Tying this all together is luck. However, you’ll find that the harder you work, the more you fail and immediately dust yourself off, the luckier you’ll get.

Orange County lacks this environment.

So, understanding what it takes to create a truly successful incubator, what would my Christmas present look like if granted (OC-based Web Incubator):

- Music blaring

- Open 24-7

- Each person in the incubator would be involved in 4-6 projects (and have 1 main project that they’re responsible for)

- Each person has $1,000 to create anything

- More young people than old (I still think old people bring wisdom and certain value to start-ups)

- Work whenever you want, wherever you want, but be in the incubator at least 3 days/week

- Focus on launching fast (1 month launch schedule), and let the market determine what they like/don’t like

- After every 3-months, get a week and a half vacation to work on whatever you want, travel wherever you want, set some goals (big picture goals and short-term goals)

- The incubator would have a non-profit structure: the returns that are made would be redistributed to the limited partners and the incubator to invest in more web start-ups

- 50 – 30 – 20 rule: 50% of the time work on your main start-up venture; 30% of the time contribute to others’ start-ups; 20% of the time to work on whatever excites you.

- Located near the beach

- Around low-cost housing/apartments

- Open-door policy (any investor, student, entrepreneur, etc. can come through and hang out)

- Simple Project management tools (37 Signals)

- For anyone that needs silence, have plenty of private office space, and also a cone of silence diagram hanging

Here are some pictures of what I envision:

And the main one:

Hopefully, Santa will be good to me this year…

Anyone share the same vision, and/or have anything to add?

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