What’s the brightest spot in L.A.’s economy right now?
That’s easy. It’s technology.
If you want evidence, look no further than the current issue of the Los Angeles Business Journal.
This week’s issue contains the annual list of Fastest Growing Private Companies in Los Angeles County. And if you scan down that list, you’ll see a gigabyte of tech companies. By my count, 40 percent of the companies on the list are involved in technology, if you include those that depend on the Internet to sell their stuff.
And they’re clustered at the top: Seven of the top 10 are tech companies. In other words, they’re the fastest of the fast-growers.
Want more evidence? The front-page centerpiece article is about how tech accelerators suddenly are getting started in Los Angeles. Accelerators are kind of like business incubators, but they get very young companies and keep them for a shorter time. Accelerators are popular with tech businesses. A few months ago, virtually no one around Los Angeles knew of accelerators, but now seven are under way or soon will be.
Here’s a question: Can you name one other sector in Los Angeles that is creating companies so fast that there’s a need for seven accelerators? Other than the business-relocation industry, that is.
So many tech companies have clustered in Santa Monica and south to the Venice Beach area and beyond (tech guys like to surf), that the area’s been dubbed Silicon Beach. Sure, it’s kind of a marketing gimmick. But if you think about it, marketing is exactly what this industry needs. I mean really needs.
Why? Because few people outside of Los Angeles (even inside Los Angeles) know about the burgeoning tech industry here. That’s a surprisingly big problem.
As a result of L.A.’s low profile techwise, tech types don’t gravitate here. And when local firms try to recruit those people, particularly talented engineers and developers, few answer the call, figuring L.A. would be like Siberia for their career.
One big problem is that Los Angeles lacks a Groupon, Facebook or Apple – a big company with a marquee name. Such a company would make the outside world respect Los Angeles as a player in the tech arena. What’s more, a big company would have many employees, some of whom would get valuable experience, graduate and become key employees in small companies. Or start their own. That would essentially solve the tech industry’s challenge of luring employees to Los Angeles. The problem: It doesn’t appear that any of L.A.’s companies will be that big-name star anytime soon.
The tech industry is L.A.’s brightest economic sector right now, but its continued presence feels a bit perilous. It is in danger of seeping into Silicon Valley or some other tech mecca.
Los Angeles is in the position of having to bootstrap its tech industry. It has to convince talented workers and investment capital to come to L.A. Right now, it appears the best way to accomplish that would be a spirited marketing campaign.
The big question: Who would do that marketing? Unfortunately, no one – no agency, company or association – comes to mind. Los Angeles doesn’t have much practice touting itself.
But at least if some agency did step forward to tout Los Angeles as a tech haven, it’d have the slogan figured out. Silicon Beach. Pretty good, huh?