Tech on the bayou: Louisiana and New Orleans make a play for start-ups
Tech start-ups say New Orleans' affordable housing and rich local culture make it a good location. Above, Canal Street separates the French Quarter from the Central Business District.
In this post-Silicon Valley world, and especially in this slow economic recovery, lots of cities and regions are desperate to attract start-ups. Whether it’s the Silicon prairies of the Midwest, or Silicon Beach in Los Angeles, cities want their own piece of the technology pie. Add to that list: Silicon Bayou in Louisiana.
If Silicon Bayou has a center, it could be the 500 block of Capdeville Street in New Orleans’ Central Business District.
On that block is a bar, aptly named: Capdeville. Last Thursday at 5 p.m., only one person was at the bar, a guy on his laptop nursing a glass of red wine. But within an hour the place was packed.
The bartender, Myesha Dunn, helped open the bar four years ago. "Capdeville was originally a rock'n'roll whiskey-themed bar, and we evolved into this hub for this really awesome tech group of New Orleans," she says, before rushing off to pour whiskey for someone in a dress shirt and khakis.
Many of the regulars work next door, in the IP building. The first floor is home to a coworking space called Launchpad.
Inside Launchpad, Paul Teall leads a monthly gathering of video game developers. Before moving here, Teall worked for Electronic Arts (EA) on the blockbuster game Madden. He moved to New Orleans to work for TurboSquid, a company with about 80 employees.
"TurboSquid is a marketplace similar to a stock photo marketplace, like iStockphoto, or Getty images, but focused on 3D models," Teall says.
When you play a video game, or watch a digitally animated movie, every object on the screen has to be made by a game developer or an animator. Or, they could buy those objects on TurboSquid.
Teall pulls up a digital model that’s a replica of the microphone I’m holding.
"You can see the lines on it, that’s the mesh, so that’s how he built it," Teall says, pointing to a grid of curved lines that covered the microphone like elastic jail bars. The price: $199.
TurboSquid could be headquartered anywhere. But when it comes to hiring employees, New Orleans has an advantage over cities where living expenses are higher: "I feel like it was the best move I’ve ever made. I love living here," says Teall.
What is also luring tech companies to Louisiana? Some of the most generous tax credits in the country. Digital media companies can get 25 percent back on what they spend on production and 35 percent on payroll. EA built its North American Testing Center in Baton Rouge, and says it brought nearly $7 million in payroll to the state.
"I think there are businesses where you have a natural competitive advantage by being in New Orleans," says Chris Shultz, the founder of Launchpad. He also has his own startup, Niko Niko, and he’s the self-described pied piper of the Silicon Bayou.
For startups that want to develop software related to food, music, or the oil and gas industry, Silicon Bayou is ideal. And, Shultz says, the culture of New Orleans itself is a big draw. "New Orleans serves as this creative muse for a lot of people."
At the same time, the idea of a Silicon Bayou, a Silicon Prairie,or a Silicon You Name It, is becoming meaningless, because technology is becoming a part of all businesses.
"A lot of traditional industries are becoming tech enabled,” Schultz said. "As Mark Andreessen says, software is eating the world."
To understand what happens when software eats the world, I talked to Brian Bordainick, the CEO of Dinner Lab, a New Orleans startup that built software to eat, appropriately, the restaurant industry. "Dinner Lab hosts pop-up events in about 10 cities across the United States," Bordainick says.
Dinner Lab is a twenty-first century supper club. Members pay an annual fee plus an additional $50-$70 per dinner, where up and coming chefs serve food in places like warehouses and rooftops.
But the whole experience is really about data that comes in the form of feedback cards. "Typically restaurants see about 0.25 percent fill out a feedback card. We bat about 95 percent," says Bordainick.
Dinner Lab is essentially a focus group. Bordainick believes the feedback his company provides chefs will help them plan new menus and take some of the risk out of opening a restaurant.
When he started Dinner Lab, several people told him that no one would fund a New Orleans start up. But he said, "we are living proof it’s not true. We had one employee this time last year, we have 50 now. We are a high growth, fast moving startup and we’re located in New Orleans."