Happiness received in Tony Hsieh's downtown Vegas

My visit to downtown Vegas was an eye opener; Part I

This is the second story in a series I’m writing as we build up to our Vator Splash Oakland event on May 6-7.

TechCocktail Week is a fun way to get to know what Tony Hsieh, CEO of Zappos, is doing in Las Vegas. If you get invited, it’s worth attending. Thanks to Hsieh and the TechCocktail team, I was part of a group to take a tour of the downtown renaissance underway and speak at the TechCocktail Speaker Series.

In the end, the four-day tour was an eye opener, especially if you're interested in understanding how entrepreneur ecosystems or regional tech clusters are formed and their affect on the existing culture. Gentrification has become the au courant nasty word, as these tech clusters emerge throughout the country. 

But what Hsieh is doing is a good model to consider as his buildout firstly is in an area that didn't have significant pre-existing neighborhoods where local residents would be up in arms about being displaced. The Fremont East Entertainment District, which is at the heart of where the development is taking place is essentially a six-block tourist destination.  

Secondly, he's created the anchor tenant, which every tech ecosystem needs. As I wrote last week, a downtown ballpark could be the anchor tenant for Oakland's emerging tech ecosystem, which we are excited to show off at our Splash Oakland event. 

Thirdly, he does seem to be inclusive in his efforts. Of the $350 million he's invested/investing, he's allocated $50 million for small business funding (e.g. caterers, restaurants) as well as $50 million for arts and education. It doesn't hurt that public funds are helping the downtown revitalization effort, but a look solely at Hsieh's Downtown Project, shows that the fruits of his efforts alone created 687 jobs out of the 1500 total jobs created in downtown Vegas in 2013.

Fourthly, a startup ecosystem should fit holistically into the local culture, which based on this photo is firmly in place.

Sure there are probably naysayers and critics about any economic development process. But for me, I was pleasantly surprised. Hsieh's book is about "Delvering Happiness" through the culture in your company. I can say happiness was delivered to me in his latest startup: the city.  

Here's my tour. 

We arrived on Wednesday at the Ogden, a luxury high-rise apartment building, with some 100 so-called crash pads for invited guests. Coffee table books about the Zappos culture, and innovation await all guests and are theirs to take home. (If you want extras, just check the cabinet – more copies await). 

The Ogden is located in downtown Las Vegas, an area that was just five years ago, a destination for low rollers (tourists who couldn't afford the more swanky Strip) and panhandlers. There are still remnants of the old Fremont that attracted illustrious stars. The "Elvis slept here" neon sign on the motel across the Ogden was visible from my room though I’m guessing that if Elvis did sleep there it was towards the beginning of his career. 

Today, the Ogden bustles with young entrepreneurs and visitors eager to participate in the entrepreneur miracle that’s happening in Vegas. Residents are either working at Zappos, are funded by the Downtown Vegas Fund or are associated somehow with Hsieh's massive city-as-a-startup expansion plan. If you're not part of this movement, you might feel left out and annoyed, according to some Yelp reviews. The area isn't exactly the safest either.

But therein lies the opportunity to be at the front of something amazing, rather than when it's already happened.

From 2 pm to 4 pm, we had a meet and greet by the TechCocktail co-founders Frank Gruber and Jen Consalvo (who just returned from their Honeymoon the prior weekend and are pictured below). The two founded TechCocktail in 2006, and moved their operation to Vegas in 2012.

The media and events company is one of the 80 companies funded by the Las Vegas Tech Fund in the last two years. You could say that Gruber and Consalvo were among the pioneers to establish themselves in downtown Vegas, and are instrumental in helping to remake downtown.

At the meet and greet, I met the two dozen or so entrepreneurs and academics I’d be hanging out with for the next three days. Here’s some of us visiting the new Zappos headquarters.

That evening from 6 pm and 8 pm, there was a speaker series held at the Learning Center, just a couple blocks away. I was honored to give my presentation on why San Francisco 2003 = Oakland 2014 (or other emerging tech areas, like Vegas). That video should be up shortly. 

The next morning, Joe and Kevin greet us and take us on our guided tour of Downtown Las Vegas.

First stop – Tony’s apartment, which comprises of three units in the Ogden. His apartment is a microcosm of the tech sprawl he’s building.  

It exudes hope, inspiration, vitality, fun, thinking and community. And it's peppered with reminders of how we should live our life.  

There is also rain forest room, which, Hsieh tells me extended from his office, which is decorated like a rain forest and is called Monkey Row. It doesn't have anything to do with the Amazon rain forest. That's just coincidental. For those who don't remember, Amazon bought Zappos in 2009.

A piece of paper with drawings about The City as a startup says a lot. Downtown Vegas is his startup.

During this tour, we learn about the $350 million in funding from Tony and where it’s going. Some $200 million earmarked for development, $50 million for tech startups, $50 million for arts and education and another $50 million for small businesses.   

Stats by the US Chamber of Commerce shows that to date, the Downtown Project portfolio consists of: 100 properties, $200 million in acquisitions, 58 acres, 1,000 apartments, 1,000 hotel/motel units, 215,000 square feet of retail space, 130,000 square feet of office space.

That night is pitch night at Hsieh's Gold Spike, a hangout with a 24/7 bar and diner and places to work and chill out. There’s also a roller rink in the back. Startup presentations are a quick 60 seconds long. 

The following day is our tour of some of the startups and a meeting with Andy White of the Vegas Tech Fund.

You'll have to watch Part II of my Vegas tour to learn about how the Fund is helping to create jobs and transform downtown Vegas. Stay tuned.