By Jacob Shafer
LOOKING AROUND THE ROOM, it was hard to separate the millionaires—and billionaires—from the kitesurfers. Partly because, in many cases, they were one and the same.
“Thanks for being here everybody,” Bill Tai told the assembled crowd, seated under slowly rotating ceiling fans in the cramped yet-sunny meeting room of the Maui Country Club in Spreckelsville. With his broad, tanned face and casual attire, Tai looked every bit the laid-back waterman.
A venture partner at Charles River Ventures with millions of dollars at his disposal, he’s also the co-founder of MaiTai Kite Camp, which marked its fifth year on Maui in May. The event is held here because of the island’s unreal kiting conditions, but it draws a who’s who of Silicon Valley heavyweights.
The discussion panel at the Country Club included Trip Adler, a 27-year-old Harvard grad and founder of the document-sharing site Scribd; Eric Setton, co-founder of the mobile video service Tango.me; and Tom Katis, a former U.S. Special Forces op who got the idea for Voxer, a “walkie talkie” application that combines voice, photo and text features, while serving in Afghanistan.
All three discussed the parallels between startups and kiting: the thrill, the danger and—if you’re lucky and good enough—the payoff.
“Kiteboarding is not the easiest sport to learn—it takes dedication, it’s scary,” MaiTai co-founder Susi Mai (yes, Bill’s last name is “Tai” and Susi’s last name is “Mai” – thus the “MaiTai” name was born) said after the panel. “Same thing with startups. You start a company from your garage, you’re struggling to make it. It takes the same sort of commitment and risk-taking.”
MaiTai is clearly, as one attendee put it, “more about play than work.” But for those plugged into the tech scene, it’s a significant networking opportunity. As Setton remarked with a wry smile, “Most of my investors are in the audience.”
For years activists and politicians have given lip-service to diversifying our economy and getting off the wobbly three-legged stool of tourism, military infrastructure and agriculture. For all the talk, not much has actually happened.
Could a tech economy be the answer? Seems implausible on a tiny island thousands of miles from anywhere. But then again, so is the idea of a roomful of kitesurfers changing the digital world.
THE HAWAIIAN ISLANDS have been, for a long time, a node on the infrastructure of the Web,” said Tai, citing trans-Pacific cables that connect the Mainland and Asia, success stories like the Web-hosting company Digital Island (which was founded in Hawaii) and local resources including the Maui High Performance Computing Center in Kihei. “The potential is there.”
However, Tai cautions, “what’s missing here and everywhere else is the nucleus of people to make it happen.
“There have been many countries that have tried to recreate Silicon Valley—whether it’s Japan, or Singapore, or Taiwan—with billions of dollars,” said Tai. “And they’ve been successful to some extent, but it’s been hard for another Silicon Valley to appear anywhere else.”
That could change soon. Unlike the early days of the Web—or even a few years ago—tech startups are exceptionally nimble. “As long as you have an Internet connection, you can start a company,” said Tai. “The people on the panel could have started their companies anywhere. All they really needed were a few people willing to stay in one place and code. Those people could have been [at] Harvard or Stanford—or on Maui.”
Sounds great, but there are hurdles. First, there’s the lack of resources. During MaiTai, some attendees complained that there weren’t even enough wireless hotspots on-island (Whole Foods in Kahului offers free Wi-Fi, but doesn’t allow people to plug in their laptops). And even if you manage to log on, Hawaii consistently ranks near the bottom of the heap in Internet speed. Then there’s our university system, which lacks a robust computer science program. (As Tai put it, “you want the next Mark Zuckerberg to be coding here in his dorm room.”) And finally, there’s the state’s reputation for being tough on businesses.
“The challenge for the Administration here is to make it known they’re entrepreneur friendly, and set up infrastructure accordingly. Whether it’s tax incentives, facilities—those kind of things matter,” said Tai.
So far, Mayor Alan Arakawa has at least said the right things. He talked about luring tech startups to Maui during the 2010 campaign, and in a May interview with a Forbes reporter covering MaiTai, Arakawa said Maui’s appeal as a vacation destination makes it an ideal place to connect professionally.
“A lot of people of the age of the Silicon Valley group like to come here,” he said. “And at the same time you vacation, you can do a lot of business.”
When asked about the high cost of shipping goods to and from the islands, Arakawa replied, “There’s no cost to [ship] concepts and ideas.” It’s a good line, but ideas don’t generate themselves. You’ve still got to attract the talent.
SILICON VALLEY REMAINS SYNONYMOUS with all things tech, but many have found freedom—and success—elsewhere. “In Silicon Valley, you’re a small fish in a huge pond, and it didn’t seem as collaborative and a lot more corporate,” entrepreneur Chad McGimpsey told The New York Times last year, in a story about Boulder, Colorado’s burgeoning startup scene. “Here, you’re a big fish in a small pond. Plus, there are mountains.”
The same story cited statistics that show venture capitalists funneled nearly $2 billion into more than 200 Colorado startups between 2007 and 2009.
Meanwhile, Gowalla—the fast-growing service that allows users to “check in” via location-based geotagging—proudly trumpets its San Antonio, Texas headquarters, while the social networking platform TweetDeck—which recently sold for $30 million—is based in London.
“There are visible startups happening all over the world now,” said Tai. And, he added, getting a few to make the trek to Maui might not be that hard. “Attach a bunch of servers to the Maui supercomputer center so there’s a free hosting place for people under a certain size, and if they hire [locally] you give them some more servers,” Tai suggested.
“Which pair of 20-year-olds with good coding skills at some computer science school would turn down an offer to come hang out in Maui and run their service for free? You would at least get a bunch of people to launch. And as long as it started to work, so long as you had enough of a base of talent, there’s no reason to leave.”
Another, related option is to establish “co-working” spaces—rooms or entire buildings where creative people can hang out and work for free with the basic tools they need—an idea that’s gained popularity in the Bay Area and elsewhere. Beyond that, there are what’s known as “incubator” and “accelerator” programs, where aspiring entrepreneurs gain skills, knowledge and, potentially, funding. Basically, startup college.
At the forefront of that movement is the Founder Institute, whose stated goal is to “globalize Silicon Valley.”
Founded by self-described “serial entrepreneur” Adeo Ressi, the Institute now has off shoots on four continents. Could a future off shoot happen here?
“Adeo is a close friend and I approached him last fall about opening a Maui chapter of the Founder Institute.” said Keith Powers, a part-time island resident, entrepreneur and start-up specialist (who also recently co-founded The Aloha Initiative with his wife Michiko, as well as Maui County’s Managing Director Keith Regan and his wife and local community leader Lynn Araki-Regan). “Maui is a paradise, but in order to thrive economically and provide great jobs and future opportunities for generations to come, Maui has to diversify its economic base now. Maui needs to become a software hub. It can do that by leveraging its natural resources and providing incentives to attract some of the best software developers and founders in the world. It is also important to remember that software is more than just ‘websites.’ I highly recommend everyone reads Marc Andreessen’s recent oped in the Wall Street Journal–‘Why Software Is Eating The World’ [Aug. 20, 2011] he artfully articulates that software powers everything. Yes everything. From online services, mobile devices, movies making, agriculture tech, organic farming, robotics, 3D Printing, sensors, financial services, and tourism to national defense – software is everywhere and it will drive innovation and jobs.”
Of course, Powers said locating tech start-ups on Maui–and in Hawaii–is far from simple.
“Being an isolated island provides an amazing attraction, but it also creates some challenges,” said Powers. “The biggest challenge is the chicken and egg problem. Everyone would love Google and Facebook to open offices on Maui and hire lots of people, but the reality is that there currently aren’t enough developers on Maui to support the costs related to opening satellite offices.”
Powers said two things need to happen before any startup gets going.
“First, we need to open a co-working space where people on Maui can work and nurture start up ideas,” Powers said. “This co-working space could also provide a home for groups like ‘Maui Makers’ [mauimakers.com] and ‘TedxMaui’ [tedxmaui.com]. I believe the best place for this co-working space would be in Wailuku or Kahalui as part of an effort to also bring more jobs to downtown.”
That’s simple enough. As for his second precondition…
“Second, we need to foster a start-up ecosystem on Maui,” Powers said. “This requires attracting software developers and founders to Maui so they can create and build companies here. We then have to attract local and mainland mentors and investors to support them. I know many people don’t like the idea of bringing more people to Maui and I can understand that, but if Maui wants to create higher paying jobs, we have to start with the people with those skills, connections and track records of building and selling start-ups.”
According to Powers, the Founder Institute has opened more than 15 new chapters all over the world in less than two years. He said county officials–including Arakawa–have been “very supportive” and he hopes to launch the first program in the spring of 2012. Aspiring local founders and developers that want to apply to the inaugural program can sign up at www.StartUpMaui.com.
“What we need right now is for someone to donate 3,000 to 5,000 square feet of space in Wailuku or Kahalui for one to two years as a home for the co-working space.” Powers said. “This could be empty retail space, warehouse or office space. If one of your readers has four empty retail spaces sitting next to each other—this would be a great way to bring some new energy to that area. We will work with a local non-profit partner to help us facilitate donations and to manage this effort. We also need angel investors, retired CEOs, professionals and professors, law firms, airlines, hotels and other service providers who want to help build this ecosystem.
For Powers, all of this isn’t just smart business–it’s smart living. “This is very personal to me,” he said. “I want my five-year-old daughter Harmony and all of Maui’s Keiki to have choices and opportunities when they grow up. Choices and opportunities here on Maui.”
THOUGH SOME WILL QUESTION whether Maui, with its laconic vibe, would be a good fit for the lightening quick world of tech startups, the two may be closer than they appear.
Consider Constantin Bisanz. Blonde and bronzed in a T-shirt and ratty shorts, Bisanz doesn’t look like a guy who started his first company at age 14 and today pals around with billionaire Richard Branson. But he is.
Bisanz is a passionate Austrian kitesurfer who sold just his last company to eBay for over $200 Million. He is also an adventure seeker and recently broke several world records by kiting across the 50-mile, ice-choked Bering Straight (an undertaking he now admits was “a bit crazy”)
When we caught up with him at MaiTai, he expressed no doubt that Maui can mold itself into a tech hub—and draw top talent from around the world.
“Everybody wants to be in a nice place,” he said. “Maybe not all of them full time, but you don’t need them all of them full time. And everybody is happy to come [to Maui].”
Further, he said that there are benefits to connecting on a board rather than in a boardroom. “If you meet these people not [only] during workshops and formally set up meetings, but also on the water, kitesurfing, and you’re high-fiving and then you share your experience—it’s just a deeper relationship,” he said.
Of course, it’s easy to be optimistic when the sun is shining, the surf is up and you’ve already made your fortune. Building a community—and a culture—where others can replicate that success takes time and effort, and there’s no guarantee it’ll pan out. Then again, risk is the name of the game.
“It takes one stroke to get on the wave,” Tai said, “and this is a big wave.”