Beaverton, Oregon, Creates Open Source Biz Incubator

by Timothy Prickett Morgan

The city of Beaverton, Oregon, has launched a business incubator that will focus on and help to foster the business prospects of open-source technologies, as I hinted it would do last week. Beaverton, as most of you know, is where Open Source Development Labs is located and where Linus Tovalds gets a paycheck these days as a fellow. But Beaverton is bigger than OSDL, and the Open Technology Business Center wants to foster a vibrant tech community there.

While OSDL is probably the most famous resident of Beaverton in the eyes of the open source community in general and the Linux portion of that community in particular, this suburb of Portland has long since housed the Enterprise Systems unit of chip-maker Intel and was also, not coincidentally, the home base of former server maker Sequent Computer Systems, which sold the first NUMA-based Unix and Windows servers, got eaten by IBM in 1999, and is one of the focal points of the $3 billion lawsuit that The SCO Group has filed against IBM. (SCO claims that IBM illegally moved Unix intellectual property into Linux, partly through Sequent's Dynix/ptx Unix, partly through its own AIX Unix.) Beaverton is also home to the Tektronix Embedded Systems division, and has fostered a community of experts in this subsector of the IT business. The headquartering of OSDL there a few years ago, thanks in no small part to IBM's and Intel's presence in the town, has also been a boon.

Having had a taste of the good technology life, and seeing what it did for towns like San Francisco, Palo Alto, and Santa Clara, in California's famed Silicon Valley, Beaverton wants to make conditions ripe for open source technology businesses; and if they decide to rewrite the Linux kernel, well, that is up to them. (That's a joke, folks.)

While early reports had it that OSDL was fostering the Open Technology Business Center, LaVonne Reimer, the executive director of the center, says that OSDL and its member have not contributed any funds to the Open Technology Business Center, which is a nonprofit corporation (just like OSDL is). In fact, all of the $1.2 million in seed money for the center is coming from the city of Beaverton, which has just under 80,000 residents. The city is located in Washington County, which has a median income of over $60,000, and only 5 percent of its population falls below the poverty line. Two-thirds of its population is 45 years or under, and it hosts the Waterfront Blues Festival, the second-largest blues festival in the United States. Throw in a few microbreweries, some good New York-style pizza, and some decent coffee, and it's pretty much software development heaven, if you don't mind a little rain now and then.

For six years, Reimer ran her own dot-com, called Senquest, which was a specialist in e-learning that focused on graduate school education. She was fielding requests from venture capitalists about various startups in the area when she heard that the city of Beaverton was thinking about putting over $1 million into an Internet incubator. She got involved and, now, as executive director, will be in charge of spending the money that has been allocated, working with the Oregon state government, which will do its part to give benefits and incentives to companies that relocate from around the world to Beaverton, and soliciting other venture funding to expand the Open Technology Business Center.

The Open Technology Business Center's current facilities can comfortably house some 15 startups, Reimer says. The idea is to give young companies with good ideas a place not only to work on their fund raising, and to rub elbows with other startups, but also to draw expertise from leaders of the technology companies in the Beaverton area, who can mentor (for lack of a better word) these young companies and thereby increase the probability of their having a saleable idea and then making a success of it. OSDL is one of these mentors, and it will specifically help fledgling companies align their ideas and products with the roadmaps of the core open source programs available in the IT market.

The Open Technology Business Center has its first venture in resident, a company called Stunt Computing, a 10-person startup that was located in Virginia and is moving into the center. The Open Technology Business Center will also provide space for what it is calling innovators in residence, which is aimed at providing support for individuals who have a good idea and need to do further development on products and business models. Within the next three to four weeks, the Open Technology Business Center expects to announce its first such person. It will not, by the way, just focus on open source software. There are all kinds of "open" hardware and embedded technologies, and as the choice of Stunt shows, it isn't just about being a Linux enthusiast.

"One of the most important things," says Reimer, "is that we have a lot of smart people walking around in the halls." She also says that the mentoring and advisory approach should mean that the return on investment for venture capitalists that back the participants in the incubator is higher. As she raises more funding for the Open Technology Business Center, the nonprofit will grow and eventually build its own facilities, she says. "We are not in a big rush. We want investors to have confidence that these products will be good hits."

The Open Technology Business Center opens its doors today in the Cornell Oaks Corporate Center.