A team of former Gateway executives has formed a new business
incubator that plans to use access to $1 billion in capital and the combined
connections of a star-studded adviser group in a bid to become the next
San Diego-based IdeaEdge Ventures will focus on building companies that
will try to integrate emerging technologies and the Internet, according to
founding partner Jim Collas, former Amiga president and former senior vice
president for worldwide product development at Gateway. Areas of investment
will include mobile and wireless Internet technology, Web
infrastructure, and "post-PC" technologies, according to the company.
Although several groups are attempting to do the same thing,
IdeaEdge comes to the market fairly prepared. The group has secured
funding from Qualcomm and Investor AB, among others. IdeaEdge says it has
access to $1 billion in capital.
In addition, the company enjoys a variety of connections in the
high-tech sector, which can be more important than a good product
or a stunning patent portfolio in the clubby world of venture financing.
Advisers from the wireless quarter include Paul Jacobs, executive vice
president of Qualcomm; John Major, former CEO of WirelessKnowledge; and Hans
Davidsson, general manager of Ericsson Wireless Internet Solutions.
Apple Computer and Gateway also are well represented. Ellen Hancock, CEO of Exodus
Communications and a former Apple executive, will be an adviser, as will David Nagel, chief technology officer at AT&T and a former director of Apple's research and development efforts, and former Apple CEO John Sculley. Gateway founder Ted Waitt is an investor and adviser. Maynard Webb, president of eBay, will also be a member of the group.
The rationale for another incubator--IdeaEdge is the third to emerge in San
Diego alone in recent months--is that eventually the Internet will become an
invisible but omnipresent factor in people's lives, said Collas.
"The types of companies and ventures needed to push the Internet throughout
everyday life are going to need to integrate emerging technologies in all
areas," he said. IdeaEdge will launch companies
focused on combining technologies that enable devices in homes or
businesses to interconnect with each other.
Overall, there are 46 new Internet incubators that have either been announced or launched since last fall, according to Tyler Orion, executive director of Pacific Incubation Network. There are now 75 incubators of all types in operation in California.
Internet-related incubators are growing as a proportion of that overall number because of their ability to get companies up and running quickly in a market where timing is critical. Southern California, of late, has seen more than its fair share of those incubators spring up, in part because they have the success of Bill Gross' Idealabs to emulate. The rise is also due to an increase in the amount and kind of resources available to companies there, resources that used to be restricted to Silicon Valley, Orion said.
"What's happening in Southern California is in part a result of the convergence of (interest in) Web technology and the availability of senior management" in the area, said Orion. With more companies like Gateway having moved into Southern California in recent years, there is a greater supply of experienced managers on hand to start incubators, as well as more cash.
Wireless technologies and services will be one key area for companies
emerging from IdeaEdge. To that end, the company's advisory board is stacked
with a star-studded list of people who are going to help provide direction
to new ventures.
Getting big-name advisers shows the company will do more than just
provide new companies with office space and money, according to Collas.
"Incubation sounds so passive. A lot of what other incubators offer is
space, some advice, contacts and basic legal service. That is not enough,"
"What we are building is an infrastructure capable of guiding all of the
ventures, just like a large corporation will have an executive team guiding
various divisions," he added, noting that advisory board members will
serve on the boards of any new companies launched from the IdeaEdge nest.
The "venture accelerator," as its partners have dubbed it, could turn at
least five plans into companies within the next six months. Sketches for
another dozen businesses are in the validation stage, according to Collas.
The company has developed about half of the ideas for companies
The founding partners include Dan Pittard, a former senior vice president of
strategy and new ventures for Gateway. Rick LeFaivre and Tom
Schmidt, other former executives of the PC maker, are also founders. LeFaivre worked at Apple as well.
The IdeaEdge partners are jumping into what is fast becoming a
crowded field. Getting a job at an incubator has become fairly common for
high-level executives. New incubators include eCompanies, headed by Jake Winebaum,
a former Walt Disney executive, and Sky Dayton, founder of EarthLink Network; Ignition, headed by former high-level
executives from Microsoft and wireless telecommunications company McCaw
Cellular; and Rearden Steel,
headed by WebTV founder Steve Perlman.