Chico launching pad
Local firm gives young tech companies a boost
Located in the southwest corner of the first floor of the Chico Municipal Center is a bustling office setting where 11 startup tech businesses are currently in the early stages of development. It’s the home of ChicoStart—a business incubator providing the physical space, technical support and mentoring for entrepreneurs to help them get their ventures off the ground.
During a recent interview in the ChicoStart office, Wendy Porter, managing director, explained her strong suit is helping others develop their business plans.
“I’m really good at coming up with a business idea, putting it together and doing the operations,” she said. “But then when it comes to marketing that business, I’m just not that great.”
Porter’s work experience includes 11 years as an information technology professional with Hewlett-Packard and more than three years as a senior contributor at Shasta QA, a software testing company with a Chico office. She’s launched a few startups herself, but found that her strengths are more in helping others than in managing her own business.
“Since I’ve taken over as director here, I’m way too passionate about this place [to devote time to a business of my own],” she said. “I love it.”
ChicoStart’s beginnings go back to last August, when local businessman Kevin Kinell and Steve Gonsalves, chairman of Innovate Northstate, got together and rented the empty city office space that formerly housed various Butte County government departments. They opened ChicoStart for business the following month, initially expecting to attract maybe five businesses. But very quickly, 11 startup tech companies bought into the concept of provided office desks, Internet access, mail service, WiFi, couches, conference rooms, a kitchen space and lounge area. Plus, there is the benefit of networking with other tech geeks for support, encouragement and brainstorming.
The nonprofit Innovate Northstate was founded about two years ago with the self-proclaimed goal “to assist the region’s most innovative companies who have the largest growth potential garner a larger share of their national and global markets resulting in a more vibrant regional economy.” ChicoStart is a step in that direction.
Porter said ChicoStart rents the office space for $1 a year. The firm then charges its business tenants between $50 and $550 per month, depending on space and technical access. “Fifty dollars is basically virtual office space, use of the mail slots and invitations to our events,” she said.
“Then there is $150 for our café-style, where you come in and use the Internet and sit wherever there is a spot available. Then there are dedicated spots for $220 and pod spaces for $550. Those are spots where you can leave your computer and seat anywhere from four to nine people.”
Included in the rent for all is access to a printer/copier as well as coffee and other drinks. ChicoStart also has a mentoring program offering the expertise of four in-house mentors: Joe Schneider, head of internal user operations for Facebook; Declan Dunn, a local marketing expert; Chico State business professor Peter Straus; and Kinell, who in addition to launching ChicoStart also previously worked for Auctiva and is now with Design by Humans.
As part of the lease, the city will receive any rent that adds to more than ChicoStart’s operating expenses, but that’s a ways off.
“We pay our utility costs,” Porter said. “They are not expecting us to reach excess rent until year three of the lease and we currently are not collecting enough rent to meet our operating costs.”
Porter said the city welcomed the business and saw it as having a potentially positive impact on the local economy.
“That is kind of why we made this arrangement with them,” she said. “We thought we’d have at least five companies in here by December 2014. We actually have 11. We have doubled our goal in half the time.”
One of the businesses occupying space in ChicoStart is a company called CoffeeTable, which is a digital catalog shopping app for the iPad and iPhone. The business was launched in 2011 by Chris Friedland, co-founder of Build.com. Andrew March took over as CEO in May 2013.
“We hooked up with ChicoStart last October,” March said. “We were one of the first tenants. It is much more developed now than it was when we first got in. What attracted us to this space specifically was the ability to contribute to a better entrepreneur ecosystem in Chico and the North State.”
March said there is a lot networking and collaboration that goes on among the different ChicoStart businesses.
“We are one of a handful of companies in here and one of the things I think is interesting and beneficial is the opportunity to talk with all these other people,” he said. “The collective mind-share we have here is way better than what we would have by ourselves.”
CoffeeTable has three employees in Chico, including March, plus one stationed in San Diego and other staff members who are overseas.
“The goal for us is to come in and establish our operations,” he said. “Obviously, a success story would be to grow to the extent where this place couldn’t handle how many people we would need.”
For now, he said, the office suits the company well.
Other businesses currently renting space at ChicoStart include Student Stock, a social network designed to help students become professional photographers, and Housing Tools, which in its own words, “helps government and nonprofit agencies more effectively assist low-income populations.”
Porter said ChicoStart is a work in progress and that the plan is for the tenants to succeed and expand to the point where they will move to their own office space, making room for new startups.
“There’s no formal process or procedure in place,” she said. At least not yet. “As an incubator, we provide some mentorship then benchmark them along the way with some expectation that they are going make some progress and move on.”