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New local business incubators nurture young startups

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Three new business incubators have hatched in San Diego to support fledgling startups and create job growth and innovation in the region.

CyberHive San Diego nurtures young businesses in cybersecurity, big data, predictive analytics and related fields, while Plug and Play San Diego cultivates technology entrepreneurs. Wireless Health Hub, in San Marcos, focuses on startups that create wireless health products, medical devices that would need FDA approval, and personal health devices.

All three provide programs, known as business or seed accelerators, for startups in the first stages of growth. The details of these programs vary, but most include mentoring and workshops, seed money in exchange for equity, help with pitching ideas to interested companies, and, in the case of Wireless Health Hub, assistance in locating new office space.

CyberHive San Diego, a nonprofit that soft-launched in February, operates out of Manpower’s downtown San Diego office. Modeled after CyberHive Maryland, the all-volunteer organization is currently advising three startups and is in discussions with three others. It is accepting applications and can accommodate up to 20 startups.

“We feel that San Diego has firmly established itself as a hub in cybersecurity,” said Darin Andersen, founder of the local CyberHive and chair of its development committee. “Cyber continues to be one of the most critical technologies in the region and in the nation.”

Backed by local corporations and organizations, CyberHive offers a shared workspace environment, which is also available to startups that may not be part of the accelerator program but crave interaction with peers and mentors. That environment fosters innovation. “If you put a bunch of smart people in a room that have different experiences, thoughts and backgrounds, they’re going to come up with a better mousetrap,” said Mark Kolheim, CyberHive’s interim executive director.

Plug and Play San Diego has selected eight out of 16 applicants to receive support from its program. Initiated in large part by San Diego-based business incubator StartupCircle, Plug and Play San Diego is partnered with global accelerator Plug and Play of Silicon Valley. Those eight San Diego startups will receive $25,000 in exchange for a 5 percent ownership of their company. They’re receiving mentoring first in San Diego, and then they’ll join other startups at Plug and Play’s 100,000-square-foot tech center in Silicon Valley. In September, each one gets to pitch large corporations, such as Google (Nasdaq: GOOG), AOL (NYSE: AOL) or Best Buy (NYSE: BBY), for example, at Plug and Play’s Expo Day in Sunnyvale.

“It’s where easily a $20 million acquisition will happen,” said Gabriela Dow, StartupCircle co-founder and vice president of strategic initiatives.

That doesn’t mean Plug and Play San Diego will funnel entrepreneurs to the Bay Area.

“The biggest fear when we were dealing with the Bay Area incubators, or accelerator programs or investment companies, is they wanted to bring those companies to the Bay Area and headquarter them there,” said Robert Reyes, StartupCircle co-founder.

Reyes brokered an agreement with Plug and Play to ensure the eight startups could return to the San Diego market and grow their businesses here, making this Plug and Play’s first satellite program.

Giving startups in the region a leg up is also important to Wireless Health Hub. The nonprofit, which launched in March, plans to offer a seed accelerator program in North County starting in August, according Jim Butz, one of the founders. He and his team are accepting applicants and can accommodate up to 10 startups.

Wireless Health Hub is modeled after TechStars, a Colorado-based business incubator with locations around the country. The first stage of its program is a 90-day seed accelerator for young startups. After that, they can take advantage of a business incubator, a co-working space at a National CORE property in San Marcos. Wireless Health Hub added a third stage: helping startups find new office space from which to run a business.

To that end, the team is working with local commercial brokers and developers so that when entrepreneurs are ready, they can “drive up the street to a brand-new building” in San Marcos, Vista, Escondido or Carlsbad, said Charles Zahl, a Wireless Health Hub co-founder. The important thing is “they’re staying in the area.”

All three business incubators agree that a strong ecosystem -- whether it’s available resources, a startup-friendly culture in the region, or access to funding-- affects a startup’s success.

“First-time entrepreneurs have an enormous learning curve to get over in the first 18-24 months,” Butz said. Now, with three new organizations lending a helping hand, San Diego startups have a better chance of getting over the hump.

-Nicholls is a San Diego-based freelance writer.

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1 UserComments
Ray Hivoral 6:43am June 14, 2013

Great news for San Diego, congrats to all! We hope these incubators will participate and support the 2nd annual San Diego Entrepreneur Day in downtown San Diego with thousands in expected in attendance. Please visit www.SDEntrepreneurDay.com. It's a great platform to get the word out. Cheers!