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Mr. Robbins’ neighborhood: Incubator program helps put San Jose at center of software universe

by Kathy Cammarata

October 2000

In the early 1990s, the world envied Silicon Valley for being a fable of American success – a place where an industrious egghead could become a latte-sipping Apple millionaire overnight. And San Jose, Calif., which could almost see all the high-tech action out its back window, was no exception. At the time, the city served as little more than a bedroom community for Silicon Valley’s workers. While the heart of the Valley lay just north in cities like Cupertino and Sunnyvale, San Jose’s downtown – with its old-line banks and accounting firms – was struggling. For years, San Jose watched its citizens and tax revenues make their daily commutes to other locales.

An aggressive redevelopment project launched by the city of San Jose, combined with the efforts of people like Jim Robbins, cofounder and executive director of the Software Business Cluster (SBC), changed all that. In the ’90s, the city brought to town such high-tech heavy hitters as Sony, Hitachi and Cisco Systems, while the SBC, a nonprofit technology incubator, helped fledgling software and Internet companies get established. To date, SBC start-ups have created more than 1,500 jobs, bringing fresh faces to the once stale downtown.

SBC Managing Director Chuck Erickson witnessed the city’s rejuvenation. “It was really pretty dead,” he says. “Now we have lots of software companies and young people downtown.”

Robbins is reluctant to take any personal credit for San Jose’s rebirth. The impact of the SBC, however, has been anything but modest. Of the 75 software and Internet companies in San Jose today, two-thirds are SBC graduates. Seventy-five percent of SBC-groomed companies say they wouldn’t have started their businesses in San Jose if it hadn’t been for the incubator. On average, 70 percent of SBC clients remain in San Jose upon graduation. The incubator’s amazing track record – 92 percent of its companies are still in business – has helped earn it NBIA’s 2000 Randall M. Whaley Incubator of the Year Award.

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Keywords: best practices, client selection/admissions, equity and royalty agreements, technology incubator

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