When you think Los Angeles you usually are struck with imagines of movie stars, glamour, and perfect weather, but most of the industries are pretty much been a standard for the past few decades. All that seems to be changing with the opening of several offices in the Santa Monica, Venice and Marina del Rey areas of Los Angeles (west Los Angeles) Such as Facebook, Google, Snapchat have made these vital hubs to their global operations. Not surprisingly this is changing the economy of Los Angeles as well as the future trajectory of tech.The backbone of this trend like many in tech has been their use of big data.
There is one company that is telling of what many of the start ups here look like and the general trajectory they follow. The name is DogVacay and as the name suggests its a kind of Airbnb for pets. I’m not kidding this is an actual company that has received huge amounts of seed money, most notably from actor and rapper Will Smith. In Los Angles founder Aaron Hirschhorn said he had little hesitation about setting up shop in Los Angeles as opposed to the Silicon Valley or San Francisco. The reason being he gets to be a big fish in a small pond. The Silicon Valley is the most competitive buisness environments in the world, and it is hard to impress your peers let alone get seed money from potential investors. However, in Silicon Beach there really isn’t the infrastructure of tech in place yet, but there is huge sums of money for people who are willing to back insane ideas like this one DogVacay. Its a small tight knit community of coders in each of these start ups and the companies do not need to compete for engineers who would likely go to google or Apple. Moreover, the obvious incentive of living in Santa Monica is a huge bargaining chip that the companies have to do very little for other than play Los Angeles rents, which when compared to the Bay Area are welcomed.
The three big kids on the block or should I say beach are Snapchat which is valued at $16 billion the streaming service Hulu currently valued at $10 billion and the dating website Tinder valued at $3 billion. They are the gold standard and are massive successes. But when we consider this to the silicon valley where the big kids on the block are Google, Apple, and Amazon it gives us pause in considering what the value of tech can be. Still no one ever said Los Angeles could legitimately compete as a true tech hub compared to the Silicon Valley. However, what the Silicon Beach has going for it is that it wants to be by far the second best place to do business in this way. In so doing they are going to open the door to welcome a lot more small start ups and out there ideas that like tech most will never make it off the ground. But, they will have the means to incubate and potentially flourish in this setting.