Plug and Play Tech Center: Where Startups Come to Make Connections

12/13/12Follow @wroush

If you’re looking for the place in Silicon Valley with the most startups per square foot, it’s probably the huge two-story office building at 440 N. Wolfe Road in Sunnyvale, headquarters of Plug and Play Tech Center. While Plug and Play runs smaller startup communities in Redwood City and Palo Alto, the bulk of its members reside in Sunnyvale, in a former Philips Semiconductors complex that’s been divided into innumerable cubicles, each housing an early stage tech company hoping to hit the big time.

With some kind of startup event going on at the facility two or three days per week, there’s plenty of opportunity for networking. And with more than 40 percent of Plug and Play’s 300 companies hailing from other countries, the lobby is a veritable United Nations, with startup employees and visitors streaming in and out all day.

Plug and Play is an interesting beast—part coworking facility, part business incubator, part investing operation. It is largely the creation of one man, founder and CEO Saeed Amidi (pictured above), an Iranian exile who leads a sprawling empire of businesses spanning bottled water, plastics and packaging, construction, real estate, and even handmade Persian and Oriental rugs. Though Plug and Play brands itself as a startup accelerator, it’s not a competitive, time-limited, mentorship-based program in the same sense as Y Combinator, 500 Startups, or TechStars. It’s more like a garden for startups, where almost any company can put down roots but only the most promising seedlings are selected for special attention, business development assistance, and, sometimes, direct investment by Amidi’s personal investment fund, Amidzad.

After numerous visits to Plug and Play for startup interviews and events, I recently made a point of speaking with Amidi and some of his resident entrepreneurs about Plug and Play itself. I wanted to hear the backstory to this unusual organization, and to find out why the place is such a popular destination for companies making their first forays into Silicon Valley.

David Parpart is the founder of Socially Relevant, a startup building cloud and mobile apps that can, among other things, remind patients to take their medications on time. He says “the energy and the environment” are what he really likes about Plug and Play. “We have an office at another shared space in Oakland which is not nearly as useful or productive,” he says. “There is really a strong community here and an opportunity to plug into a lot of resources and people.”

Just down the hall from Socially Relevant’s cubicle, for example, is another desk rented by Omron, a medical device maker that manufacturers half of the world’s blood pressure cuffs. “It was great to be able to walk a few yards to their cubicle and say ‘We should chat, we’re in the same space,’” Parpart says. Even if Socially Relevant expanded to 50 or 100 employees, Parpart says he would still want to rent at least one cubicle at Plug and Play, the better to “participate in the events and be part of the community.”

Jordi Torras is a co-founder of Inbenta, a startup based in Barcelona, Spain, that’s using natural language technology to help big consumer-facing companies improve the search features of their websites. When the 30-employee company decided it wanted to go after the U.S. market, it decided to use Plug and Play as its beachhead. “The United States is a huge market, but it is also the most competitive market in the world,” Torras says. “We wanted to be here to talk to investors and learn from companies who might be partners, and in that respect the return has been immediate. We are closing deals already. It’s been very successful for us.”

Lately, Amidi has been ramping up Amidzad’s investment activity, and setting up formal relationships with companies inside and outside Silicon Valley, including many in Europe. He’s pitching Plug and Play as a place for these companies to tap the creativity of hot young Silicon Valley startups. Just days before my visit with Amidi in late October, for instance, Plug and Play had unveiled a partnership with Volkswagen; the giant German automaker plans to back up to 10 Plug and Play startups at a time as part of a new accelerator program designed to transfer ideas “from the nonautomotive domain into the automotive domain,” to quote a VW exec interviewed by the Silicon Valley Business Journal.

Here’s an edited summary of my conversation with Amidi.

Xconomy: Say you were speaking to an audience who had never heard of Plug and Play. How do you describe it?

Saeed Amidi: I believe that Plug and Play is a microcosm of Silicon Valley. It embraces what Silicon Valley has to offer. There are a lot of charismatic, energetic entrepreneurs who never get a chance to build their dream. I believe that if an entrepreneur comes to California, to Silicon Valley, and builds up confidence and guts to take their first step and initiate a startup, then the whole Valley sort of helps them along with advice, seed funding, corporate funding, venture funding, and event that both educate them and increase their changes of success. We’re part of that.

X: Is Plug and Play a real estate play, an investing play, or both?

SA: Initially, when we started this back in 2006, our idea was that it would be a great platform to meet more startups and make better investments. In the process, it would also be a good real estate play, where we got this building and so far we have had 1,200 companies go through it. So it’s not either/or—we wanted to achieve both at the same time. Then again, … Next Page »

Wade Roush is a contributing editor at Xconomy. Follow @wroush

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