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Office-As-A-Service RocketSpace Doubles Real Estate To Accomodate Bigger …

Fri, 29 Mar 2013 13:28:05 +0000

Startups around the world are desperate for office space in the San Francisco Bay Area, so tomorrow RocketSpace will announce the lease of a new 50,000 sq. ft. office so it can house startups with up to 60 employees instead of capping them at 30. Along with this RocketSpace Suites project, the “office-as-a-service” plans to lock down another 100,000 sq. ft. spot and open a space in London this year.

RocketSpace currently provides plug-and-play office space for 130 startups and their 600 employees at a per-person, per-month rate. It lets founders concentrate on their businesses while RocketSpace handles leases, security, bandwidth, firewalls and other office hassles. Its relationships with venture capitalists and corporate accelerators have kept at least one of its residents securing funding every week, and it runs inspiring events featuring speakers like Peter Thiel and Vinod Khosla.

CEO Duncan Logan told me in a meeting today that one of RocketSpace’s biggest problems is that due to space contraints, “we kick out companies when they get to 3o employees.” Fast-rising startups like Uber, Spotify, Kabam, and Leap Motion have all gotten the boot. It’s also receiving far more qualified applicants than it has room for. RocketSpace needed more, well, space. Meanwhile, its current real estate is literally about to get steamrolled. Tomorrow, the city of San Francisco will announce RocketSpace’s current 181 Fremont location will be demolished to make way for a new Transbay Tower transportation hub.

So after a year of searching, tomorrow RocketSpace will announce the lease of a 50,000 sq. ft. space just north of Market Street at 180 Sansome. Eventually it hopes to take over that whole tower. But RocketSpace Suites is just the start of its expansion. It’s currently looking at a 90,000 sq. ft. Bay Area space to replace the Fremont home it will have to vacate. Logan says it will be able to host 2,000 people in its combined 140,000 sq. ft. space. By the end of 2013 RocketSpace plans to have added a London space. And even though it’s completely bootstrapped, after that it’s eying Tel Aviv, Berlin, and Vancouver for additional locations.

Logan says RocketSpace aspires to become an “innovation campus” that he calls a “Stanford for startups.” He explains that “young companies are like young people. They’re a product of their environment. We can build the best possible environment for startups.” By surrounding themselves with similarly ambitious makers, Logan believes startups can be more creative and productive.

Just watch out for your neighbors poaching your engineers.

ROCKETSPACE

Startup. Blast off.

RocketSpace is an accelerator for high-growth, seed-funded tech startups. We provide the fuel that every startup needs to accelerate: access to top talent, tier 1 venture capital, and blue-chip brands representing millions of potential customers.

Our programs are focused on creating the perfect tech startup ecosystem: speakers classes in our dedicated event space, services from the best startup service providers, and research analysis covering over 10,000 startups worldwide representing the “what’s next next” in technology.

Located in…

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Article source: http://techcrunch.com/2013/03/28/rocketspace-suites/

San Francisco, San Jose team up to keep tech companies

Thu, 21 Mar 2013 05:32:07 +0000

SAN FRANCISCO — For years, as they’ve jockeyed for tech jobs and the cachet that comes with them, San Francisco has touted its cosmopolitan allure, while San Jose has countered with its vast supply of land.

Now, in an effort to add a weapon to his city’s arsenal, San Francisco Mayor Ed Lee has proposed reshaping a 30-acre stretch of freeway and rail yards into high-density housing, shops, restaurants and more than 2 million square feet of high-rise office space.

But rather than a new stage in a Bay Area arms race, Lee’s plans are being hailed as a sign of a new, cooperative sentiment sweeping the region. “Mayor Lee wants to see how to promote the Bay Area,” said his spokeswoman, Chrisine Falvey. “There will

be widespread benefits if companies relocate or expand to San Francisco, San Jose, Oakland or nearby areas.”

Added San Jose Mayor Chuck Reed, whose city long has billed itself as Silicon Valley’s capital: “I’m worried about Texas,” not San Francisco. “We’ve got much bigger competition for companies that are expanding to other states and countries instead of keeping their growth in Silicon Valley.”

Enrico Moretti, a professor of economics at UC Berkeley who has studied the region’s history of innovation, said traditional rivalries have yielded to the reality of a fast-shifting business landscape.

“It used to be the case that tech companies were either in the South Bay or San Francisco. Now they are in both locations,” he

said. “And workers are much more mobile.”

At the same time, Moretti said, Lee’s proposal to knock down Interstate 280 north of 16th Street and relocate a Caltrain storage yard near ATT Park is an aggressive move for the business-friendly mayor, who has worked to keep startups in town as they grow.

Lee already has cut tax deals with such startups as Twitter in exchange for help revitalizing rundown areas, and he persuaded city voters in the fall to eliminate a payroll tax the mayor and others insisted punished companies for growth.

“Knocking down the 280 extension makes a lot of sense,” Moretti said. “It will free up a lot of land to attract companies and create jobs.”

Lee, in fact, said razing the overpass and rail yard is the city’s last, best hope to create the kind of corporate campuses that San Jose and other cities long have used to woo companies that have outgrown San Francisco’s South of Market area. The neighborhood is home to companies such as Zynga and Yelp and also includes the Mission Bay area, where city officials have already targeted expansion zones for tech firms.

But

some say the area already is so filled up there’s little room for growth.

“When you go to lunch in SoMa, you have to get out of the office before noon or you’re going to be standing in line,” said Jason Johnson, co-founder of startup accelerator Founders Den, which sits near the Caltrain yard in Lee’s sights and offers startups shared office space and other resources.

“At certain times, companies have to leave because of their size, or because of tax incentives elsewhere,” Johnson said. “San Francisco has lost a lot of companies over the years.”

To be sure, Lee’s plan won’t give San Francisco anywhere near the amount of office space San Jose boasts. The 30 acres the mayor thinks can be freed up is about the size of a single corporate campus on San Jose’s North First Street. And Reed and other San Jose officials are making plans of their own to add millions of square feet to that area, accommodating as many as 20,000 new jobs.

Rather than view Lee’s plan as a possible threat, Reed sees it as another piece of the region’s real estate portfolio.

“It’s important that we have options in the Bay Area,” Reed said. “North San Jose’s got one kind of development potential. We’ve got Coyote Valley with another kind of development potential. We’re trying to provide lots of different kinds of environments for companies to work in. Those that want to be in a San Francisco high-rise will choose that.”

Lee’s proposal isn’t without its sharp critics. Some

commuters worry it will slow traffic in and out of the city.

Caltrain officials, too, say they need the rail yard to house trains, especially with plans afoot to electrify the line as part of the state’s high-speed rail project. The city is paying for Caltrain to conduct an eight-month study weighing the plan’s potential impacts, according to Santa Clara County Supervisor Ken Yeager, who heads the Peninsula Corridor Joint Powers Board that owns and operates the commuter line.

Still, Yeager acknowledged, despite Caltrain’s concerns, Lee’s plan “would be a tremendous boon” for San Francisco and the rest of the region.

Ultimately, economic forces that are far stronger than the ambitions of the mayors of San Jose and San Francisco are likely to carry the day, said UC Berkeley’s Moretti, who wrote the 2012 book “The New Geography of Jobs.”

“The labor markets in the Bay Area are getting increasingly integrated,” Moretti said. “This is very good for the region, very good for high tech and very good for the Bay Area economy.”

Contact George Avalos at 408-373-3556 or 925-977-8477. Follow him at Twitter.com/george_avalos. Contact Peter Delevett at 408-271-3638. Follow him at Twitter.com/mercwiretap.

Article source: http://www.insidebayarea.com/business/ci_22831780/san-francisco-san-jose-team-up-keep-tech-280-development

Iterations: Lessons We Can Draw From Cherry

Sun, 13 Jan 2013 19:44:07 +0000

Editor’s Note: Semil Shah is a contributor to TechCrunch. You can follow him on Twitter at @semil.

Every week, it seems, a new marketplace or services business is born. Some of the hottest companies of 2012 — after photo-sharing apps, of course — were online and mobile marketplaces and services-based companies, pioneered by the likes of Uber, for instance, and all the way to a newer company (with a common investor) to help you find someone to watch your four-legged friends while you’re away from home.

Cherry, the service to book a car wash for your four-wheeled friends, fit in this category. In December 2012, Cherry announced it would shut down its service after raising venture funding. I used Cherry a few times throughout the year and it worked great for me. I know Cherry was, at one point, booking a lot of car washes in and around the Bay Area, and I always assumed that, eventually, the purpose of raising venture capital was to expand their labor force and upsell other car-related services to become a more diversified business. This makes sense particularly in urban areas, where the real estate and infrastructure needs of a physical car wash operation aren’t practical. So, why not bring the wash to the car instead? (I’m not sure what Cherry’s future plans are as they raised a good chunk of money, but I hope they find a new angle and keep going.)

When TechCrunch’s Anthony Ha reported on Cherry’s shutdown news last month, I was surprised at the negativity in the comments section, a place typically reserved for a congratulatory chorus. Forget about the fact they’re coordinating car washes for a minute, and Cherry is not all that different than many of the other emergent services companies to pop up in this golden, overstuffed age of startups. That said, they provided more of a service rather than a marketplace, and that is a big distinction.

The demise of Cherry’s car washing operation is a failure that the Bay Area ecosystem can draw many valuable lessons from, which is important to the ecosystem right now given the sheer number of startups trying to harness the web and mobile to provide services or build new marketplaces. Companies such as Postmates, Exec, Lyft, Sidecar, TaskRabbit, Zaarly, Instacart, SWIG!, and so many more all fit into this broad category.

The lessons from Cherry listed below are written from a “venture-scale lens” because the company did raise institutional funding and others will as well, but of course, venture capital is certainly not a prerequisite to starting a new service business or marketplace and not all new endeavors need to be at venture-scale to be valuable. With that disclaimer and context, here are the three key “venture-scale” lessons we can draw from Cherry:

Transaction Volume: Cherry customers probably didn’t need a car wash every day. Maybe every week, at best. Therefore, to maximize revenue in the Bay Area, where they started, Cherry would have had to either begin to upsell other car-related services to be delivered at the time of a car wash and/or to maximize the number of bookings made through its service. Now, on the other hand, a marketplace for town cars like Uber is something users could do daily, or even multiple times a day, assuming they have the budget. Uber’s transaction volume is high on two dimensions: repetitive use and high-ticket sales. Companies in these categories looking at venture-scale opportunities will most-likely need to show robust figures in at least one of these two dimensions.
Profits Margins: Revenue may be en vogue again, but all revenue isn’t created equal. The real metric of interest is the profit margin. Venture-scale businesses need to have tremendous leverage in their revenue models. Consider the crown jewel: Google. Each Google search is a mini-auction for advertisers to bid against that search, lining Google’s pockets with $100M+ revenue….per day! By contrast, many of today’s new services have models which require the organization of excess labor supply, training that labor, and supplying it with materials and/or information in order to carry out the mission. Each step between point-of-sale and point-of-completion puts more and more pressure on the model and most likely compresses any margin. Through this lens, we may see why Cherry couldn’t justify their financial model. In venture-scale businesses, investors will want to model out the likelihood that any business could apply leverage on the revenue to extract margins, which creates the real economic value they seek.
Scaling In The Real World: Suppose Cherry worked so well in the Bay Area that they began a plan to expand to other cities. My sense is that in the SF Bay Area right now, and for the past year or so, many folks around here have a tendency to assume “scaling offline” is complex but as controllable as “scaling online.” While scaling an infrastructure and system online is certainly difficult, I would say right now it’s much harder, more expensive, and more time-consuming to scale these types of business offline and into new locations. Each company in these categories would need to build their own playbook in their test market (usually the Bay Area) and then execute against that plan to expand their reach while maintaining quality. And, even if these conditions are met, a VC may be reluctant to invest given the minefield of operational risks any team will surely endure. Pulling of a business like this takes serious time and effort. There may be a Starbucks in every town in America, but keep in the mind the company was founded in 1971.

It’s easy to mock Cherry as a small idea, but I give them credit — and hey, they could still do something new and interesting. They went out, delivered a service, and while there were some hiccups, their shutdown creates a learning opportunity for the ecosystem which is especially timely given the companies I’ve mentioned above, and the venture capital (and time) needed to make these things spread offline with real margins. In the past few months, I’ve grown concerned that these offline, non-technical, and operational elements aren’t taken into humble consideration or waved off as being “easy” to execute on. Too many people think to themselves, “Hey, we’ll do what Uber did, no problem.”

Well, what Uber did and is doing is really, really hard, and they still have a long way to go. It’s also important to recognize that Uber is mostly a marketplace and doesn’t handle labor as much as some of the other companies. Managing and training labor is time-consuming and expensive, and can negatively impact all three dimensions listed above. When Uber was raising their early venture and growth rounds, some investors still passed on the deal because while they liked the transaction volume and offline scaling proof points, some questioned the robustness of margins. To each his/her own. That said, if Uber had such a tough time and fought through it, I’d imagine everyone else in this broad category will go through as much pain or more in order to get a peek to the promised land in the horizon. Yes, it’s a fight worth fighting for, but as we see with a company like Cherry, which probably had enough cash to keep going for a bit longer, there should be no illusions in how hard it will be to get there.

Photo Credit: knottboy / Flickr Creative Commons

CHERRY

The carwash that comes to you: Park anywhere, check in online, and Cherry will wash your car right where you left it.

? Learn more

Article source: http://techcrunch.com/2013/01/13/iterations-lessons-we-can-draw-from-cherry/

What San Francisco Real Estate Tells Us About This Technology Boom

Tue, 17 Jan 2012 17:39:38 +0000

Real estate can tell you a lot about people and markets.

Hundreds of Web-savvy startups have sprung up in San Francisco’s oldest buildings in the South of Market district (called “SOMA” for shorthand). So behind that sleek new Apple iPhone whatever-it-does application are a bunch of software developers crowded into a brick building that 100 years ago housed a meat warehouse, a button factory, or maybe a flophouse. Best of all (for those who enjoy irony), that same startup labored, even spent a few grand, to make sure their former warehouse looks nothing like: an office.

Original bricks are a must, according to Hugh Scott and Travis James who help run the technology practice at real estate firm Jones Lang LaSalle. “The funkier the better,” says Scott. This duo have spent the past decade landing homes for startups in the Bay area.

Exposed pipes are another top request. These used to be out of cheap necessity, in buildings where landlords were too stingy to shell out for even ceilings. But now tenants are willing to pay for what used to be done out of thrift. Scott and James have seen several tenants add $15 to $20 a square foot to their costs of moving in by asking that the ceilings be ripped out and the pipes cleaned to get that cheap chic look. For landlords, ceiling-free space is commanding a 10-20% premium.

One highly sought-after space was previously the storage closet for the nightclub below. What’s hipper than having your startup next to a night club? (Hint: the answer rhymes with “hip club”.)

Dogs are another a must-have accessory for today’s startups. This request tends to rule out any buildings owned by real estate investment trusts, which typically put “no pets” clauses in contracts.

Commercial rents in most cities are below 2007 levels. Meanwhile SOMA is commanding a hefty premium. Rents have jumped 35% just in the last two years, with some deals hovering around $50 per square foot — matching rates in Palo Alto’s most desired corridors, including the famous Sand Hill Road.

“Most spaces are seeing upwards of four offers,” says James, before smiling suddenly as a text message comes in and he adds: “We submitted an offer sheet for a place last Wednesday. Heard back yesterday, and now I’m hearing we’ve got just 24 hours to make a decision.” James sprints back and forth between downtown San Francisco and Palo Alto, alternatively finessing newly-picky landlords and networking with venture capitalists in the hopes meeting up and coming startups.

While rents here are soaring, they’re still not near the last bubble’s levels. That could mean this is less of a bubble, or simply reflect new buildings that have sprung up in SOMA. Scott and James aren’t sure. Another intriguing difference this time around: rents might be a leading indicator instead of lagging when it comes to the performance of tech’s all-encompassing NASDAQ stock index. Take a look (rent rates provided by Jones Lang LaSalle):

In the 1999 technology craze, rents trailed gains in the technology index. It’s as if the initial public offerings were happening before startups could even secure space. Then it seems once-optimistic companies got stuck in longer-term leases for a while. The rise and fall of both was swift.

Now it seems the opposite is at work. Rents have been creeping upward as technology stocks have stumbled.

Surely the slow, faltering IPO market is in part to blame. The NASDAQ isn’t yet seeing much action from what’s bubbling in SOMA (Zynga’s lackluster offering is one exception). Last time around the ultimate prize was the IPO. Ten years and Sarbanes Oxley later, IPOs aren’t as desirable or necessary.

Some companies, notably Facebook, Dropbox, and Airbnb, have so far managed to avoid the headaches of going public while still raising IPO-size amounts, from venture capitalists. Social networking tool company Jive landed $120 million in its December IPO. Dropbox meanwhile scored twice that, $250 million, in its private funding round months earlier. If there is froth this time, it isn’t showing up in the NASDAQ.

Article source: http://www.forbes.com/sites/victoriabarret/2012/01/17/what-san-francisco-real-estate-tells-us-about-this-technology-boom/

Sri Lankan native is a serial entrepreneur

Mon, 10 Oct 2011 04:34:57 +0000

As is true for many technology-trained immigrants who come to the United States, opportunity beckoned for Saman Dias. She arrived in the Bay Area in 1984 when she was 24 to start a training program for a software program under development.

She learned the project was in danger of running out of funding after she had arrived. Dias took matters into her own hands, drawing on her experience four years ago in her native Sri Lanka of teaching children and adults how to use computers.

“I ended up making cold calls and getting training and consulting opportunities and contracts through other training companies,” she said. “I had to be proactive and not just wait and expect somebody to save us.”

Not waiting around for something to happen has never been her style.

Over the years, she has founded three companies in the Bay Area and was instrumental in getting two others off the ground. Her latest venture is SKD LaunchPad, a recruiting firm she founded that specializes in finding employees for venture capital-funded startups. “You can have the greatest idea but if you don’t have the right team to implement the idea no one wants to give you the money,” Dias said.

“She’s an extremely dynamic and powerful woman leader. She has a lot of charisma,” said Farhana Huq, president and founder of Oakland-based C.E.O. Women, which provides entrepreneurship and communications training to low-income immigrant women.

Wendy Chang connected with

Dias through a mutual acquaintance and has turned to her for advice for her www.classjunky.com website, a one-stop place for finding on-site local classes.

“She’s extremely patient and very knowledgeable with business in general,” said Chang, 39, of San Francisco. “She really understands how to steer me in the right direction without really pushing hard.”

Dias, 50, lives in San Ramon with Lee Chamberlain, her longtime companion who is a retired Drug Enforcement Administration officer.

In addition to taking on challenges in her professional life, she doesn’t hesitate to take them on in her personal life. She overcame a fear of the water by learning how to paddle board while vacationing in Maui after being challenged to do so by Chamberlain.

“I have struggled to learn how to swim for the longest time, even though I come from an island nation,” she said. “Today, I am swimming and enjoy paddle boarding.”

Another goal is to learn how to ride a motorcycle.

The couple recently rode back from San Diego up Highway 1 on their three-wheeled Can-Am motorcycle. Chamberlain drove the motorcycle, but Dias is determined to learn to ride the bike on her own.

Dias credits much of her ambition to being raised by a military officer father who encouraged her and her two younger sisters to be self-sufficient and independent while they were growing up in a village outside of Colombo, the capital of Sri Lanka. Her mother was a teacher who provided the balance needed to temper her independent streak and taught her cooking, sewing and other domestic skills.

“If something were to happen to (my father), life would be different for us, so he gave us a tremendous amount of freedom and almost raised us like boys,” Dias said. “One of his sayings, which I think about even today, is that ‘Failures are the pillars of success.’ “

She remembers coming home after getting beaten up by some neighborhood kids.

“I would come home crying and Dad would say, ‘Don’t come home crying. Next time you just hit them back.’ And they stopped hitting me. That was my first exposure to standing up,” she said.

She played with her male cousins who lived nearby, riding around on mopeds and learning to drive a car when she was 14.

Being in the Girl Scouts was also a big influence in her life because independence, teamwork and perseverance were among the values that were stressed.

After earning a degree in computer science from the University of Colombo, Dias was recruited to work for Bartleet Electronics, a distributor of Radio Shack computers in Sri Lanka. That’s when the teaching melded with the tech side.

“I realized I had a very natural knack for teaching. I found myself constantly learning all the software applications,” she said. She taught computer skills to her co-workers and buyers of Radio Shack computers. Dias also set up a for-profit weekend school when she was 20 in a rented space in Colombo to teach children and adults how to use computers. To get the word out, she rode around on the back of her father’s moped and placed fliers on walls and utility poles.

Her boss was impressed and dispatched Dias and three other co-workers to the Bay Area in 1984 to work on the startup project to develop software for Radio Shack computers.

“We changed direction to use my expertise to build a training company and got out of the software development venture,” she said.

The computer training company Dias cofounded became known as The Training Alternative. It was acquired by Heald College in 1993.

Her next venture was to start AIM Computer Training, which grew into a multimillion-dollar company that provided computer training to Fortune 1000 companies and government agencies.

“I had the experience, the contacts and the connections,” said Dias on what prompted her to start AIM. Originally serving the Bay Area, the company expanded into a global organization. The company was acquired in 2004 by a couple of Silicon Valley investors for an undisclosed price.

Dias became involved with two real estate startups before launching SKD LaunchPad.

She sees her career arc as one that evolved over the years, going from setting up a computer training company, to building new companies, to helping other companies grow.

“I found this niche. I have a passion for entrepreneurship,” she said.

Contact Eve Mitchell at 925-952-2690.

NAME: SAMAN DIAS

Dec 2009 to present: Founder and managing partner, SKD LaunchPad, a talent acquisition and recruiting firm.
Jan 2008-Dec 2009: Senior vice president, SmartZip, a website spun off from NorthPoint Real Estate Investment Services. SmartZip supplies investment ratings for residential properties.
March 2006-Dec 2007: Executive vice president, NorthPoint Real Estate Investment Services.
Nov 1994-Nov 2005: Founder, president and CEO, AIM Computer Training.
Jan 1986-Oct 1992: Co-founder, director of curriculum and instruction, The Training Alternative.
Advisor to Astia, a nonprofit formerly known as the Women’s Technology Cluster.
Quote: “You look and say, ‘Hey. Maybe there are other ways to do this. Instead of seeing walls you see a window.”

Article source: http://www.mercurynews.com/business/ci_19064172?source=rss