This is the second story in a Re/code Special Series about the Los Angeles tech scene. In these LA Stories, we’ll take you behind the scenes of a playful, powerful and potentially game-changing tech boom taking place across the Southland.
Influential Los Angeles venture capitalist Mark Suster was sitting in a meeting of LA tech power players one week in March, with one agenda item: Get rid of the term “Silicon Beach.”
Get it off the mayor’s office innovation reports. Get it off the startup-networking websites. Get it off the t-shirts. Get it off the bumper stickers.
I called Suster and said I’d like to write something about Silicon Beach and about that meeting, organized by the LA County Economic Development Corporation to reshape the way people see LA tech. To an outsider, the term seemed derivative but innocuous enough: Silicon Beach refers to the startups clustered in the palm-tree-lined beach communities of Santa Monica and Venice, but it’s often used to broadly describe the tech community in LA. It’s been bouncing around for decades referring to various coastal towns and has only very recently become both specific to LA and wildly (to some, frustratingly) popular. I had no idea I would find myself in a linguistic battleground and, eventually, playing poker with the term’s inventor.
“If you even publish those words, it will make me scream and pull out my hair and scratch my fingers on the chalkboard,” he said. “No serious professional — no serious professional in LA — talks about ‘Silicon Beach.’ There are a bunch of early-stage young inexperienced party-boy-type people who promoted the nickname. And let me say this to you: The most successful LA startups have all been founded east of the 405 freeway.”
To be fair, freeway orientation is everything in LA.
Perhaps that’s why the term Silicon Beach has an extremely firm stronghold in the lexicon down south and seems to be useful to community organizers. There is a Silicon Beach LA guide to the local tech events, a Silicon Beach Fest with panels and pitches and parties, a Silicon Beach Startups meet-up group, and a Silicon Beach Young Professionals network.
But for that pivotal meeting in March, the tech brass gathered at Saatchi Art in Culver City – near said offensive strand, but not on it. In the room: Peter Marx, the city’s Chief Innovation Officer; Allen DeBevoise, co-founder of Machinima; Mike Jones, co-founder of Science; Kamran Pourzanjani, co-founder of PriceGrabber; and Paul Bricault, a partner at Greycroft. The meeting was co-chaired by Zack Zalon, the co-founder of Wilshire Axon, who became galvanized to fight the phrase after a reporter called him about yet another Silicon Beach story. After the PowerPoints, it turned to discussion and debate.
By all accounts, it was uncomfortable.
“The only thing as lame as that name may be establishing a controversy around it,” said Randy Churchill, an SVP at Cooley, a law firm that represents Snapchat and other startups. “The whole meeting was difficult. Someone was like, ‘LA is only known for Myspace, and it’s depressing.’ And Mike [Jones, former CEO of Myspace] is sitting right there.”
As the meeting rolled on, everyone talked about perceptions of LA, which were, according to Churchill, that “it’s not safe, you can’t find engineers, people don’t work hard and there’s no public transport.”
“All true,” said Dave Young, a partner at the law firm Cooley. “Other than working hard.”
Young said that when he first heard the term, he was confused: “I thought it was ‘Silicon Beeyotch,’” he said. “Which was strange, too.”
No one has been more vocally opposed to the term than Suster, who runs the venture capital firm Upfront Ventures, which has had around $1 billion under investment since launching in 1996. He is pretty sure that people who use the phrase do so as a personal affront aimed at him.
“There were a few party boys who raised a lot of money who promoted the term — by the way, none of their companies are doing well now,” Suster said. “And they promoted the term for one reason: Because I hated it.”
Citing an event called Silicon Beach Hotties, Suster said that the name connotes a misogyny that’s not part of the LA tech scene. And he said it seemed strange for LA’s tech community to be referential to the Bay Area: “When you’re the second-largest city in America, you don’t need a derivative title.”
But no one can deny that more startups seem to be popping up (and staying) near the beach. The real-estate boom there speaks for itself: Alex Rose, the SVP of Continental Development, said that there are “no fewer than two dozen projects and a good two-billion-and-a-half dollars in development on a 18,000-acre swath of land” around El Segundo explicitly designed for tech workers’ desires.
“A lot of stuff is going on in a tightly packed area for when these tech companies outgrow the Westside, which is already starting,” said Rose.
Dave Young, whose Santa Monica-based firm Cooley expanded from four lawyers to 26 in the last 20 months, said the trouble with tech getting a foothold in LA was always geography and drive times. Before the beach consolidation, the city had second-tier funding on par with San Diego, but everyone was so spread out that it was more like five Salt Lake Cities, diluting the investment impact.
“Because it takes an hour and a half to drive to each one of those cities, you can’t recruit someone from Pasadena to work in Santa Monica. You might as well recruit someone from the Bay Area, because they’d have to move anyway,” he said. “You can’t expect someone to come to an event at 5 pm, because it takes two and a half hours to get there.”
But things began to change. Now, 40 percent of the 275 companies he represents are within walking distance.
“You can’t walk down the beach without running into founders,” he said. “It’s finally a community.”
I didn’t set out to find the inventor of Silicon Beach — I didn’t know if anyone knew who invented things like that. I assumed that the name had just emerged from the ether. But one night I was talking about the term, and a couple people asked if I knew that “Paige was in back,” or if I had “asked Paige about it.”
In a dark room in back of the private club 41 Ocean, Paige Craig, a muscular former Marine turned angel investor, was chewing tobacco and winning at a game of poker.
Did you really invent the LA Tech’s much-debated nickname Silicon Beach?
“I did,” Craig said, spitting into a cup.
An investor who has seed-funded AngelList, Postmates, Klout and Dwolla, and was part of the second round in Lyft, Craig said he coined the phrase to consolidate a disparate tech community under a catchy but instructional moniker.
“When I came here in ’08, there was this big identity problem. Bigger than that? The geographic problem. There were people in Pasadena, Downtown, everywhere. You have to have the density, that serendipity. If tech’s fucking everywhere, it’ll take 50 generations to build an economy here,” Craig said. “I immediately decided ‘Silicon Beach.’ It tells you where we are, and it sells one of our best features.”
Some people don’t like it, I parried. He reached for a steak skewer and checked his cards under the table.
“Yeah, I know,” he said. “But in six years, no one’s found a better name than Silicon Beach. The mayor’s office put a council together to name LA tech.”
What did they come up with? “I don’t even remember, but it’s about as sexy as ‘urethra.’”
For the record: The LA Mayor’s Council on Industry and Innovation hasn’t agreed on a term.