Pasadena has mushroomed into a tech center with a burgeoning ecosystem of coworking space, venture capital funding, and employment opportunities
Published : Tuesday, June 25, 2019 | 5:16 AM
Councilmember Andy Wilson is bullish on tech in Pasadena and his bet looks increasingly like a safe one.
Wilson recently released some statistics that paint a portrait of tech promise for the city, statistics that demonstrate a legitimate clustering of innovation companies in recent years and the economic benefits flowing from that critical mass of business.
Following the founding of Innovate Pasadena in June, 2013, the city has experienced “tremendous” growth in the quantity and size of venture capital funding for tech companies locally, according to the data provided by the councilman.
Wilson’s figures demonstrate that there were six “rounds” of tech funding in 2012. That’s the year before Innovate Pasadena came onto the scene. The numbers do not increase consistently. Some years like 2017 (22 rounds), were more fertile than other, such as 2013 (11 rounds), but most years doubled, or better, the 2012 number.
The size of projects funded has increased as well. In 2012, $15 million in seed money was made available to those wanting to develop technology products.
By 2018, that number had grown to $144 million. Funding mostly hovered in the $60 million range after 2012, save for 2015 ($94 million), so the 2018 figure represents a significant jump in funding availability.
“Additionally,” he observed, “there are eight new funds that manage more than $300 million that either were originally headquartered here or have offices [in Pasadena]. Having easy access to local funders is really important. When we started there were just a few angel groups. Now we have a bunch of institutions writing more and bigger checks.”
Wilson, the City Council representative for District 7, says it is Innovate Pasadena that is the powerhouse behind what is happening.
Innovate Pasadena was formed by a small group of community and business leaders from Caltech, ArtCenter, Pasadena City College, the City, and local technology companies, with an eye to fostering innovation locally.
“Our mission is to advance greater Pasadena as a center for technology and design innovation by supporting collaboration across and within business, academia and the broader community in order to attract and retain companies, entrepreneurs, innovators and capital,” says Innovate’s website.
Since its start, the internal volunteer leadership team has nearly tripled, according to Innovate Pasadena President Beth Kuchar. Four major businesses have been brought into Pasadena with the group’s participation and some 630-plus job seekers have been connected to 20 local tech companies.
Wilson’s figures were pulled from a larger, regional study focusing on what is happening in innovation across Southern California; a look at which communities are hot.
The study was done by the Alliance for Southern California Innovation, which Wilson runs, and Boston Consulting Group (BCG). He said BCG gifts the Alliance $2 million-worth of consulting and analysis on the Southern California market.
Funding, Wilson noted, is an important indicator, as is the number of patents being issued to local innovation companies, and the number of startups.
“So the Alliance looked at a number of variables to figure out what the hotspots are and Pasadena very much shows up as an up-and-comer, a city that’s on the move,” said Wilson.
“What’s also important is having people who write these checks in your own community,” he added.
“In addition to all of the new funds and new capital that we’re seeing flow into the city, said Innovate’s Kuchar, “which of course is backed up by that lovely BCG study, before Innovate Pasadena was founded, we had no coworking space here.”
The BCG study put current square-footage of coworking space in Pasadena at a healthy 100,000. Such complexes, Kuchar explained, allow start-ups the flexibility to focus on building a business without the long-term, stultifying terms of a typical, bricks-and-mortar rental arrangement.
“While you see all different types of businesses using coworking spaces, they do tend to attract technology and design-oriented companies,” Kuchar explained. “So a lot of tech and design start-ups here tend to be drawn from them.”
When the project first got going, Wilson and Innovate Pasadena worked with the City of Pasadena and spoke with major cowork outfits, showing them appropriate spaces for them to unpack their business, according to Kuchar.
“That’s a role that, to this day, Innovate Pasadena still plays where there are businesses that are exploring moving into the area,” she said. “We try to show them an unbiased view of the talent that lives here and similar companies that have grown up here and become successful.”
Justin Tsui, incoming chair of the Pasadena Chamber of Commerce, sees Innovate Pasadena’s role as one of connecting individual technology resources, putting them together through different forms of meet-ups.
“It’s a great name and it’s one of a number of groups helping to make Pasadena a regional center for technology,” said Tsui.
Asked to provide another, Tsui singled out the Alliance for Southern California Innovation.
Different parts of Southern California have different capabilities, explained Councilmember Wilson. Pasadena is strong in biotechnology, robotics and artificial intelligence. Riverside’s focus tends to be on agricultural technology, while Irvine is mostly about medical technology and cybersecurity.
Wilson was a co-founder of Innovate Pasadena and the Alliance is merely an effort to apply the apparently successful to other locales in the region.
“We believe that a vibrant ecosystem brings energy and excitement,” said the Councilman-businessman. “And that ecosystem starts telling a story; a narrative about what’s going on. And as the story gets louder and the energy gets higher, it attracts more entrepreneurs, which attract more capital, which create more jobs, and it becomes a flywheel.”