Creating a dynamic work environment and filling it quickly with serious, hard-working entrepreneurs is crucial to the success of any large-scale space housing technology startups, David Cummings, founder of the Atlanta Tech Village, told a group of power brokers gathered at the Little Rock Regional Chamber of Commerce on Wednesday.
Cummings, 35, started his first software company with the help of Duke University classmates in his dorm room, and in 2007, he co-founded Pardot, a marketing automation system, which he later sold for $100 million in cash. He used part of the proceeds to establish the Atlanta Tech Village in a midrise building he bought and refurbished in the heart of Atlanta's financial district, in the Buckhead area.
"I set out to buy the biggest building I could afford and fill it with crazy entrepreneurs," he said.
The reason for Cummings' trip to Little Rock was to give members of the Little Rock Technology Park Authority Board a chance to ask questions about his steps for creating a tech village -- entrepreneurs are called "villagers" -- and how to attract tenants with strong core values. They work in peer groups with other like-minded members and get help from assigned mentors.
He calls it "engineered serendipity."
Companies pay $350 a month per desk and are forced to "graduate" once their villagers fill 25 desks. Two to three companies graduate per year. One graduate is the smartphone social media app Yik Yak, which allows users to anonymously create and view discussion threads within a 2-mile radius.
The Atlanta Tech Village houses 900 people, including 260 startup companies, in 103,000 square feet and has a waiting list of entrepreneurs. At least for now, all are software companies. Prospects undergo a thorough screening process to make sure their principles match his: "Be nice. Dream big. Pay it forward. Work hard, play hard."
Perks include an in-house gym and locker room with showers, free fitness classes such as yoga and kick-boxing, beefed up Wi-Fi and a rooftop lounge with a view of the Atlanta skyline. They also have free beer on tap, game rooms, pingpong, shuffle board, free lunch every Friday, nap rooms, standing desks and razor scooters throughout the building. The village hosts monthly new-member socials and other events throughout the year.
Little Rock Technology Park Executive Director Brent Birch said Cummings' tech village closely aligns with the Little Rock group's initiatives for the first phase of development, which includes acquisition and renovation of about 40,000 square feet of prime real estate on Main Street and Capitol Avenue, plus parking for tenants. That square footage does not include another 48,000 square feet the tech park is buying that is leased by the state.
Once the real estate deal closes in January, a renegotiated state lease will provide cash flow while the tech park proceeds with Phase 1 construction.
Cummings spent about $30 million to buy and refurbish his building; the Little Rock tech park is expected to spend $24 million on Phase 1. When complete, the $100 million tech park will be located in and adjacent to a city block between Main and Scott streets off Capitol.
Unlike Cummings, who didn't need taxpayer funds or government assistance to start his venture, the Little Rock tech park is relying heavily on $22 million from its portion of a 2011 voter-approved city sales tax. That money accrues annually through 2022.
Also, Cummings' building was mostly leased when he started the village. He began operations on just one floor of the building and took over other floors as tenants left. He said Wednesday that he would not recommend renovating a building the way he did it.
He expressed concern about the Little Rock venture opening with so much available space.
"You build out a great space and it's there, but then if you walk through it and there's nobody in there and there's no vibrancy, it's not going to be inspiring for entrepreneurs to dream of being in there one day," he said. "You have a chicken and egg problem, where you need to have a bunch of companies lined up to go into it, even if they're not tech companies.
"It takes time to build up a community."
His goal is to create 10,000 high-paying technology jobs over the next 10 years by way of startup companies through the tech village. The more high-paying jobs a community has, the more disposable income people have, he said.
Right now, the Little Rock tech park's startup companies share co-working space in the Block 2 building at 107 E. Markham St. Users pay $150 per desk and get mentoring and programming from the Arkansas Venture Center, housed in the same building. Already, three startup companies have outgrown the tech park's temporary space and have taken up residence in market-price office space elsewhere downtown.
Business on 11/19/2015