Jason Mendelson, the Elvis of Innovation, Offers Some Lessons for San Diego’s Tech Sector

9/20/11Follow @bvbigelow

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talking with local VCs who have no more money to invest. And they have little interest in attending the dozens of innovation-oriented events that nonprofit groups like Connect, CommNexus, and the San Diego Venture Group hold each month. They don’t think the topics or speakers relate much to what they’re trying to accomplish—and even if they did, they’re not going to pay $50 to attend. Generally speaking, they say they just don’t get much out of networking with the folks who attend such events, including San Diego’s older generation of enterprise software executives.

It was this situation that prompted Spencer to arrange a call with the Foundry Group’s Mendelson. As we recounted our discussion with him, Mendelson said it sounded much like the software scene in Boulder when he moved to the Colorado college town five and a half years ago. With a population of only about 100,000, Mendelson said Boulder now ranks, “at worst, as the fourth-largest in terms of new company formations and companies getting funded.”

He talked about the factors that helped lift Boulder’s software sector out of the doldrums, beginning with the key role the University of Colorado has played in fostering a startup community, a common theme in most tech clusters. UC San Diego has served a similar role here through programs offered by the Jacobs School of Engineering, the medical school, and the Rady School of Management.

People tend to over-rate the importance of homegrown VC firms, Mendelson said. He estimated that 70 to 80 percent of the venture capital flowing into Boulder these days has been coming from firms outside the city. Likewise, Foundry Group does not restrict its hunting grounds to Boulder or even the Rocky Mountains. Like most VCs these days, Mendelson says Foundry is making investments throughout the United States.

So what’s the missing ingredient?

“Do you have somebody there who is willing to do something like TechStars?” Mendelson asked. “You need somebody to be a promoter, somebody willing to work 24/7, to live and breathe this stuff.”

Mendelson said David Cohen has done that as the CEO of TechStars, the business accelerator that was founded in 2006. Since then, the mentorship-driven, seed-stage investment fund has expanded to Seattle, Boston, and New York City. But Mendelson said he doesn’t see TechStars expanding … Next Page »

Bruce V. Bigelow is the editor of Xconomy San Diego. You can e-mail him at bbigelow@xconomy.com or call (619) 669-8788 Follow @bvbigelow

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  • http://www.foundrygroup.com Jason Mendelson

    Am I the young, good looking Elvis, or the old, fat one?

  • http://www.xconomy.com/author/bbigelow/ Bruce V. Bigelow

    Hah! I guess Bryan Abrams of Men Colored Badd would have been more apt. But readers would go “who?” And to tell you the truth, I had never heard of Men Colored Badd before your parody. Then I was thinking Justin Timberlake… but Nah…

  • http://www.xconomy.com/author/ghuang/ Gregory T. Huang
  • Nik Souris

    Good meeting you this evening and thanks to you and Jeb for sharing the San Diego landscape while bringing some outside perspective.

    Getting those people in a room would be interesting for sure.

    To me there is something about the SD landscape / culture / mindset possibly the water or people that gravitate here that keep those ingredients of big tech companies like Intuit/Qualcomm/HNC, great Universities and great wealth from forging a reputation for San Diego as a tech destination.

    Perhaps it is an inherent defense of the City from congestion and talent wars. Interestingly, despite the perceived absence of unbiased mentors or Tech Stars or Y-Combinator or Plug-n-play or VCs – internet companies do start and grow here – in several cases reaching that “ultimate” investor exit like internet dot-bomb survivors Provide Commerce and Active Network.

    For me tonight’s get together at Flud exemplifies SD – quiet, casual, reserved, friendly, mindful of its own business, “how can we help you”. It wasn’t Disrupt or Demo Days or Deal Pitch and I am certain the “excitement” will be self-contained to the folks that participated.

    More importantly, I believe tonight’s crew left with a great feeling about themselves, what they have and where they’re at – part of San Diego’s technology sector – not necessarily missing those tech start-up wizards, and most definitely not about to let that keep them from succeeding.

    So did Mendelson respond to you? FYI, Boulder has over 300 sunny days per year more San Diego or Miami :)

  • http://www.xconomy.com/author/bbigelow/ Bruce V. Bigelow

    Nik, it was great meeting you as well, and thanks for this thoughtful comment. As you might guess, Jason describes his schedule as “a wreck,” but we’re workin’ on it.

  • Tom

    > FYI, Boulder has over 300 sunny days per year more San Diego or Miami

    Let’s see, it’s January: partly cloudy and 70 degrees or sunny and 15 degrees… which do I choose?

  • http://www.incubatemiami.com Marc Billings, Miami, FL

    300 Sunny days, 70 degrees in January, and a truly international marketplace. Jason is welcome in Miami for his next concert.

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