From the PBS News Hour, November 4, 2014 — “Replacing Surf Shops with Startups, Tech Boom Makes Waves in Bohemian Beach”
Artist Laddie John Dill says, “Things really started to go sour when Google moved in, so it’s now Silicon Beach. The landlords just turned around and raised the rent, to the point where now the artists can’t afford to live there.”
GWEN IFILL: Next: replacing surf shops with start-ups, as tech titans move to catch some rays and some waves.
Steve Goldbloom reports.
STEVE GOLDBLOOM: In San Francisco, computer programmers are like rock stars. Here in Los Angeles, the rock stars are the rock stars. But now that’s starting to change, as more entrepreneurs are trading in the high costs of Bay Area living for sunnier space right here in Venice Beach. They even have a name for it, Silicon Beach.
But as is the case in San Francisco, the tech boom brings with it both prosperity and its share of problems.
CHAD BILLMYER, CEO, Panjo: We’re a marketplace for auto, sport, and hobby enthusiasts.
FARBOD SHORAKA, CEO, BloomNation.com: It’s awesome to be by the water and working at the same time.
CHAD BILLMYER: Three hundred and sixty-five days a year, I can walk to work. Right? It’s going to be sunny. It’s going to be 70.
STEVE GOLDBLOOM: L.A. Times tech reporter Paresh Dave covers Silicon Beach.
PARESH DAVE, The Los Angeles Times: The West Side of Los Angeles has always been sort of a young, hip district. And things like the weather and being close to the beach, to some, it was attractive. And I think that’s what got it started.
STEVE GOLDBLOOM: Entrepreneur Erik Rannala decided to relocate to L.A. from the bay area. He co-founded Mucker Capital, the first start-up accelerator to arrive in Silicon Beach. They nurture and invest in young start-up companies.
ERIK RANNALA, Co-Founder & Managing Partner, Mucker Capital: I have seen a lot of these buildings switch over from, you know, not tech companies to tech companies.
STEVE GOLDBLOOM: BloomNation.com is one of start-ups to graduate from Mucker Capital. They’re an online marketplace for handcrafted flower designs.
Here’s CEO Farbod Shokaka:
FARBOD SHORAKA: This is only 1,500 square feet, but we have almost 17 people in this office. So, we’re…
STEVE GOLDBLOOM: You’re growing.
FARBOD SHORAKA: Yes, hopefully we’re going to a new office space. It’s going to be exciting for us, but good problems to have. We’re outgrowing our current office space.
STEVE GOLDBLOOM: Don’t you need to be where the money is? And isn’t the money in Silicon Valley?
FARBOD SHORAKA: Money is coming down here now, so it’s exciting. We have even investors coming today to visit us that are from Palo Alto and from Chicago.
STEVE GOLDBLOOM: One of the pioneers here of Silicon Beach is Snapchat. It’s the enormously popular app among teenagers that lets you share photographs that self-destruct shortly after they arrive. They occupy a full city block right off the beach here in Venice.
Last year, they turned down a $3 billion acquisition offer from Facebook to try to make it here on their own.
PARESH DAVE: I think that was sort of a big turning point. And since then, people are like, oh, well, if Snapchat can build a global brand here in Los Angeles, why can’t we?
ERIK RANNALA: Three years ago, I used to still hear people pitching scripts in coffee shops. Now they’re pitching business plans and business ideas for start-ups.
STEVE GOLDBLOOM: This is the offices of Epoxy, which doesn’t really look like an office, but I’m going to…
JUAN BRUCE, Co-Founder, Epoxy: Hello there.
STEVE GOLDBLOOM: Hello. How you doing?
JUAN BRUCE: Hello. Welcome. Welcome to Epoxy.
STEVE GOLDBLOOM: Steve.
JUAN BRUCE: Juan.
STEVE GOLDBLOOM: Epoxy TV is a social platform for online video creators. They make YouTube stars go viral by leveraging every social media platform under the sun. It’s run by Juan Bruce and Jason Ahmad.
So this is your home or your office?
JUAN BRUCE: This is our office. This is the office for Epoxy. And it’s got a little bit of an interesting history in that it’s actually part of Dennis Hopper’s former compound. And this particular building is a Frank Gehry building from the 1980s.
Now, the funny thing is a lot of start-ups have these buildings now. There’s two start-ups behind.
STEVE GOLDBLOOM: Two start-ups behind. So, the start-ups are taking over.
JUAN BRUCE: Yes.
STEVE GOLDBLOOM: As the start-ups move in, some longtime Venice residents are moving out. World-renowned artist Laddie John Dill was the original owner of the Frank Gehry building now occupied by Epoxy TV.
LADDIE JOHN DILL, Artist: I moved to Venice in 1968. I was forced to leave my studio of 28 years because the rent was raised to $42,000 a month.
Things really started to go sour when Google moved in, so it’s now Silicon Beach. The landlords just turned around and raised the rent, to the point where now the artists can’t afford to live there.
STEVE GOLDBLOOM: The rise of housing costs has lead to big business for Tami Pardee, owner of Pardee Properties. She’s the highest selling real estate broker in Silicon Beach.
TAMI PARDEE, Owner, Pardee Properties: Business has definitely picked up. Over the last two years, we have had 20 percent gains each year, and it’s almost completely due to, I would say, the tech sector.
STEVE GOLDBLOOM: When did this go on the market?
TAMI PARDEE: It just went on yesterday.
STEVE GOLDBLOOM: So, how long will it be on the market?
TAMI PARDEE: I think it’s already sold, to be honest with you.
It’s really creative, the technology sector, and Venice is known for its creativity in the art — in the whole art world in the past, so it’s actually a great meshing of cultures. There’s been a little — as we have talked about, little gentrification issues going — you know, not issues, but gentrification going on, I would say. And that’s — it’s difficult.
STEVE GOLDBLOOM: We’re here inside a live-in workspace in Venice. The resident wishes to remain anonymous, but he has been showing us around. He’s been living here since 1967. There’s a few other artists here. And they are going to have to leave at the end of February because they received a notice from the owner.
MAN: The family has decided it is time to develop the lot, which unfortunately means…
STEVE GOLDBLOOM: Evicting…
MAN: … word evicting. But I must have everyone out by February 28.
STEVE GOLDBLOOM: Here’s Juan Bruce again of Epoxy TV.
JUAN BRUCE: Venice has always been like kind of an experimental and artistic community. And so start-ups pretty much fit perfectly in that kind of ethos.
Originally, this was an artists-in-residence live-work loft.
STEVE GOLDBLOOM: Right.
JUAN BRUCE: And now it’s still very much a live-work loft, but we’re living the start-up life.
STEVE GOLDBLOOM: It’s clear the tech scene gravitates towards countercultures, the hippies of San Francisco, the rockers of Austin, and now the artists of Venice. But as tech brings with it high-paying jobs and rising home prices, ironically, it makes it difficult for those countercultures to persist.
For the “NewsHour” in Los Angeles, I’m Steve Goldbloom.