Silicon Beach: The Selena Gomez of SoCal’s tech industry

By Francisco Dao , written on May 23, 2013

From The News Desk

Since it’s LA Tech Month here at PandoDaily I thought I’d take the opportunity to spill the unpleasant truth about my adopted hometown. Just like our cousins in Hollywood, where tabloid-friendly party monsters get all the press while hard working talent is ignored, this same dynamic has carried over into the Los Angeles tech ecosystem as represented by the undeserved, and frankly inappropriate, focus on “Silicon Beach.”

While similar trends exist in other areas, including Silicon Valley where Y-Combinator startups often get more press than anything Intel or Cisco is doing, the level of hoopla surrounding Silicon Beach at the expense of the rest of Southern California’s tech industry puts all other hype bubbles to shame.

The first thing to understand about the Southern California tech ecosystem is that it’s extremely diverse and spread out over a large geographical area. Even if we ignore San Diego and consider only the greater Los Angeles metro region we have at least five major areas outside of Silicon Beach.

First, there’s the Pasadena area where Idealab, Caltech, Jet Propulsion Laboratory, and nearby Claremont College are located. If you want to see some serious engineering and hardcore technology that rivals and even surpasses anything going on in the best parts of Silicon Valley, look to the Pasadena/Caltech ecosystem, not Silicon Beach.

Second, we have the Calabasas-Thousand Oaks biotech corridor where Amgen and a slew of other bio and pharma tech companies are based. I don’t know much about the biotech industry but for reference purposes, Amgen’s current market cap is $76 Billion while Facebook’s is $62 Billion and Yahoo’s is $30 Billion.

Third is the Downtown area with its own burgeoning tech community anchored by the largely self-funded and wildly successful Nasty Gal. Downtown LA also has an interesting maker movement with Two Bit Circus and the LA MakerSpace.

Fourth, in Hollywood/West Hollywood we have the Machinima juggernaut as well as DeviantArt and StudyMode, two more bootstrapped and very profitable companies mostly flying under the radar, along with another distinct set of companies separate from the Silicon Beach scene.

Fifth, down in Orange County there is literally a whole other county worth of tech companies including Specific Media, which bought MySpace from Fox, and hardware firms such as Kingston Technology and Vizio.

I’m sure I’m neglecting other areas that have an existing technology presence, for example within Orange County you have Irvine, Lake Forest/Foothill Ranch, and other areas I’m not familiar with, which only reinforces my point that the Los Angeles tech ecosystem is so much larger and more diverse than what you see in Santa Monica and Venice.

Furthermore, with the exception of their ludicrous attempts to claim SpaceX as one of their own, the Silicon Beach community seems to spend so much time self-promoting that they ignore the larger and legitimately profitable companies in their midst. Barely anyone had heard of Riot Games until Tencent bought them for $400 million, and you never hear people talk about Cornerstone on Demand or an “old school” company like Belkin, even though they are based on the westside. Instead, all the focus is on Silicon Beach with its Viddy fiasco and its multitude of incubators, one of which thinks copying San Francisco’s underwear delivery in a box startup qualifies as innovation.

There are of course legitimate success stories in Silicon Beach. Zefr comes to mind, but the inordinate amount of attention paid to the area is a disservice to the rest of the Los Angeles tech industry and paints a skewed and somewhat unflattering portrait of SoCal tech as a whole.

The truth about the LA tech ecosystem is that it is so much more than Silicon Beach. Compared to some of the other areas, especially Pasadena, Orange County, and the Thousand Oaks biotech corridor, which have shown lasting success, Silicon Beach is the unproven new kid of the block getting all the attention based on the belief that it is the hot new thing. It’s basically the Selena Gomez of the Southern California tech industry.