The Irvine Co. lets technology startups roam free, rent-free, in their downtown office building -- also known as the AT&T Building -- in hopes they will someday ink leases in one of the firm's other properties. That plan appears to be working.
Five companies recently moved out of the 15,000-square-foot tech incubator at 101 W. Broadway, and some of them moved into nearby Irvine Co.-owned space.
Brand management tool Chatmeter and social platform Saambaa recently "graduated" from the incubator as early-stage companies and opted to move into Irvine's One America Plaza building that sits just four blocks away from the incubator under a discounted rent deal.
In February, 13 hot startups -- each with one to a few employees -- moved into the downtown tech incubator run by EvoNexus, an arm of the San Diego-based nonprofit tech industry association, CommNexus.
That number soon grew to 20 software companies, which develop mobile apps and Internet services targeting e-commerce, location-based services, social engagement and cloud computing.
Thanks to the incubator's model of donated space and services, startups don't have to pay a dime to work in the building, despite its priceless location just steps from business partners, bars and restaurants.
Other perks include attention from investors and mentoring from tenured technology executives.
A number of companies admitted into the incubator earlier this year entered as early-stage startups under a six-month term.
Once companies hit their six-month mark, they essentially "graduate" from their early-stage status. They can extend their stay by applying for the later-stage program, which will grant them another one to two years at the downtown site.
The initial six-month period recently ended for a group of the first companies admitted.
“Some will be entering this later-stage program and some will not, but all of these companies completed the six-month program and have made significant progress,” said Bailey Cunning, vice president of operations at CommNexus / EvoNexus.
Five of the original companies have moved out, but it’s not clear as to which ones didn’t make the later-stage cut.
“We do not comment on applicants' admissions,” she said.
Matt Voigt, co-founder and CEO of Saambaa, admits his company was not ready for the later stage.
His company set up shop in the nearby West Broadway building a couple weeks ago, which he calls "a large, open office we like to call 'Incubator 2.0.'"
Saambaa has partnered up with McFarlane Promotions, which coordinates some of Southern California’s biggest events. It powered the mobile app for the recent SoCal Music and will do the same for the upcoming Monster Bash.
The company also teamed up with Uber, a GPS-powered car transportation service that recently rolled into San Diego. Anyone with Saambaa gets $30 free credit on their Uber account.
As graduates, they are still affiliated with the incubator and can take part in programs offered. In the meantime, a fresh batch of startups will soon be taking their spot under a competitive process.
"We are completing diligence on the current round of applicants," Cunning said.
The chosen few will move in at the end of the month through early October to the downtown space or EvoNexus' other local incubator.
In October 2009, EvoNexus’ 16,000-square-foot incubator opened in another Irvine Co.-owned building in University Towne Centre, hosting 14 companies that have raised more than $55 million in venture funding since incubation. Six of those companies have “graduated” and left the incubator.
One of the five early-stage graduates at the downtown incubator, Zambig Inc., followed a different path and is now doing business as Intercom.fm.
“Our time at EvoNexus was nice, but we needed our own space and are now in Pacific Beach,” said Cordell Giesen, head of design at Intercom.fm.
The company lets users add sound effects to voice messages, and morning show or radio hosts can use their voice to interact with their audience through a mobile device.
“We have been getting great reviews from inside the radio industry, including Mark Ramsey Media and the top radio publication 'Radio Ink,' as well as being featured at Convergence in Silicon Valley,” Giesen said.
The first company to move out of the downtown incubator was textbook service HubEdu Inc., which got acquired by San Mateo-based Rafter Inc. this summer.