From Silicon Valley in the Bay Area to Silicon Beach in West Los Angeles, the California coast is famous for its startup culture. A new public-private taskforce in Long Beach is now hoping to extend the startup axis further to the south.
The City of Long Beach, in partnership with the Institute for Innovation and Entrepreneurship at California State University, Long Beach (CSULB) and private equity wealth management firm Sunstone Management Inc., recently announced the launch of a startup accelerator to be housed at the World Trade Center in Downtown Long Beach.
“The primary goal for the accelerator – big picture – is really [to] build the support in the city for early stage tech startups,” Economic Development Director John Keisler told the Business Journal. “We need to provide a place where early stage tech startups can access different forms of capital and get the preparation they need to be successful in developing their solutions as well as the legal, financial [and] business planning, so they can actually secure funding. That doesn’t exist in the city.”
Sunstone, a Long Beach-based firm with offices at the World Trade Center, offered up 3,000 square feet of its own office space to house the accelerator. Additionally, the firm boasts a network of investors that could provide funding sources for startups supported by the program. Yet, Sunstone Founding Partner John Shen said investment opportunities weren’t the driving force behind his company’s participation.
“Our primary goal for this accelerator program is to help the economy here in Long Beach,” Shen said. “The accelerator is more for really early-stage startup businesses. If you give them the support that could facilitate their growth in the very early years, you do have a good opportunity to invest. But the process will be much longer.”
Still, access to investors will provide a draw for startups with ambitions to grow their business. “The companies will come if there’s access to capital,” Keisler said. “In our [Economic] Blueprint we talk about investing in ecosystem development and that’s really what the accelerator will do.”
Dr. Wade Martin, economics professor and director of the Institute for Innovation and Entrepreneurship at CSULB, expects the accelerator to provide a much needed resource for the “economic ecosystem” Long Beach is striving to develop. “We have a lot of coworking space, we have some programming, but to have this more targeted, focused accelerator is something that the Long Beach economy has needed for quite a while now.”
Through the accelerator, new businesses have access to the institutional knowledge and educational capabilities of CSULB, as well as connections to policymakers and local businesses cultivated by the City of Long Beach. The project is not using any city funds at this point, Keisler noted. “That doesn’t seem to be the challenge. The challenge generally seems to be that people need partners and people need a trusted broker who is in the nonprofit sector [or] in the governmental sector.”
With a letter of intent from all three partners on the books, the next step is the formation of a board of directors comprised of industry experts who are tasked with fleshing out the details of the program. “There’s a lot of detail in these policy decisions that we want to leave open to the board,” Keisler said. “They’ll set the agenda.”
Keisler expects the board to form within the next two months, followed by the establishment of a nonprofit to administer the program. Based on the success of the program, Sunstone has offered to expand the physical space it provides. “If the program grows significantly next year, we can have the entire floor of the World Trade Center dedicated to the accelerator,” Shen said.