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Los Angeles Mayor Antonio Villaraigosa hopes that a focused group of movers and shakers will help the city attract more startup investment. He says it's about much more than just job creation.
Today, Los Angeles Mayor Antonio Villaraigosa rolled out his Council on Industry and Innovation at the Variety Venture Capital & New Media Summit. What does the mayor have in mind? He wants to turbocharge L.A.'s efforts to catch up to Silicon Valley — although it's unlikely the city will ever really close that gap.
The council’s membership is a who’s who of L.A. tech, finance, and entertainment leaders. It's been under construction since last year and includes six sub-committees that will focus on areas such as attracting investment capital to the city, improving education's role in innovation, and enhancing networking opportunities.
Villaraigosa said that the council isn’t just about jobs and job creation. It’s about "creating a narrative about L.A. as an innovation center."
The mayor, who began forming the council last year, says that narrative has been unclear. And that’s no surprise because L.A. is know as the capital of the entertainment business. When it comes to technology and startup investment, it’s overshadowed by Silicon Valley, home to tech giants like Apple and Google. Silicon Valley has always drawn the bulk of venture funding, something like 70 percent over the past decade. That leaves L.A., New York, Massachusetts, and everyone else to fight over the rest.
Welcome to Los Angeles! The land of startups!
The interactive map above, which lives at represent.la, has been the talk of the Twitters and the L.A. startup community for a week now. One of the companies on the map, Ebyline, actually generated a blog post about what it all means. Peter Beller was the author, and I thought his take was pretty fresh.
So I checked in with him. I should have known that a former Forbes writer who did a presitigious Knight-Bagehot Fellowship at Columbia University and then stuck around Morningside Heights to get his MBA would go the extra mile: he cranked out a spreadsheet on VC funding in Silicon Valley, New York, and L.A.
When he isn't doing this type of thing, Beller is the Director of Content at Ebyline, an L.A. startup that has built a platform to provide primarily daily newspapers with a steady stream of high-caliber freelance journalists. It is not a content farm. (I've actually worked for a content farm, and Ebyline definitely isn't one, although in fairness not all so-called content farms deserve all the bad press they've received.)
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U.S. Sen. Chuck Schumer (D-NY) has been a proponent of the JOBS act.
The Jump-start Our Business Start-ups (JOBS) act just passed the Senate. The House passed a measure with the same objectives, so now it's up to the that body to revise the legislation and move a bill closer to becoming law. You can read a summary here.
This is not legislation that has failed to inspire both support and dismay.
Venture capitalist Fred Wilson loves it:
I'd like to thank our elected officials for coming together in a non-partisan way to address an important set of issues and deal with them sensibly and correctly. This doesn't happen enough in Washington and we need more of this. I know that the majority leadership in the Senate, particularly Harry Reid and Chuck Schumer, fought back a mini revolt among the left wing of its party to get this bill passed. I applaud them for doing that and standing up for something that was not popular in their caucus. That is leadership and I appreciate it and I am sure the readers of this blog do too.
Facebook co-founder and CEO Mark Zuckerberg poses at Facebook headquarters in Palo Alto, Calif., Feb. 5, 2007. This was long before he became a modern-day robber baron.
At Breakingviews, Rob Cox lays into our presumptions about the virtues of Silicon Valley startup founders like Mark Zuckerberg, Mark Pincus, and (by implication) Steve Jobs. Here's a salient paragraph:
Though Silicon Valley’s newest billionaires may anoint themselves the saints of American capitalism, they’re beginning to resemble something else entirely: robber barons. Behind the hoodies and flip-flops lurk businesspeople as rapacious as the black-suited and top-hatted industrialists of the late 19th century. Like their predecessors in railroads, steel, banking, and oil a century ago, Silicon Valley’s new entrepreneurs are harnessing technology to make the world more efficient. But along the way, that process is bringing great economic and labor dislocation, as well as an unequal share of the spoils. Just last week, the Justice Department warned Apple that it planned to sue the company along with several U.S. publishers for colluding to raise the price of electronic books - monopolistic behavior that would have made John Rockefeller proud.
Facebook founder and CEO Mark Zuckerberg speaks during a news conference at Facebook headquarters on October 6, 2010 in Palo Alto, California. The company's anticipated 2012 IPO could be one of the biggest ever.
According to Fred Wilson, of Union Square Ventures, it's a movement. In fact, he argues that staying private and continuing to seek venture funding rounds, rather than going for a premature IPO, is the "new IPO." And he thinks this is good:
The IPO market for web companies we have right now is rationale. We can argue whether it is pricing these offerings correctly. But it feels about right to me. I believe we will see a bunch of IPOs next year, led by Facebook, which is the poster child of this whole "stay private longer" movement. If we as an industry can be patient, keep our companies private longer until they are truly IPO ready, then we should have a sustainable IPO market. That's where we seem to be headed. Let's not get greedy and screw it up.
I actually saw this in action (sort of) yesterday, when I did an AirTalk segment on reputation management with Michael Fertik, CEO of Reputation.com. His startup is on its forth venture round and has so far raised close to $70 million. I wondered why a company that's been around since 2006 is still in the VC space. But maybe the idea is to stay private until it truly makes sense to go public.