Catching The Wave

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Business law firm Stubbs Alderton & Markiles has worked with L.A. technology companies from its Sherman Oaks office since the early 2000s. But as those companies flocked to Santa Monica, the firm’s partners found themselves making more trips there and holding meetings in coffee shops.

So Stubbs Alderton recently opened a second office. It’s in the heart of Santa Monica, making it closer to and giving it a more noticeable presence among many of the clients it serves.

The law firm is one of several service providers moving into Santa Monica to be closer to the growing technology community on L.A.’s Westside, known as Silicon Beach.

“We were in the community, but we wanted to invest in the community more,” said Greg Akselrud, a partner at Stubbs Alderton. “With the growth of this community, we wanted to demonstrate that we are physically here.”

The service firms moving to Silicon Beach are coming from other parts of Los Angeles as well as from Silicon Valley. Some of the companies, such as Stubbs Alderton, have had a presence in Los Angeles but have opened up an office or moved to Santa Monica. For example, software development provider Carbon Five recently moved from Marina del Rey to Santa Monica and venture capital firm GRP Partners is looking to leave Century City for the Silicon Beach neighborhood.

At the same time, Silicon Valley mainstays are moving to the area as they take notice of the tech market. Over the summer, one of Silicon Valley’s most prominent law firms, Cooley LLP, opened in Santa Monica – its first L.A. office. Its competitors are expected to follow.

Angel investment fund Lowercase Capital, which is run by Bay Area investor Chris Sacca, has also beefed up its presence by hiring a full-time L.A. director to invest in Silicon Beach startups.

David Young, a partner in Cooley’s Santa Monica office, said that these incoming businesses are helping to grow the tech community.

“Having focused, sophisticated service providers helps,” he said. “When you look at the different communities around the country, it is a really important part of the ecosystem.”

That’s not to say that there’s been a dearth of L.A. service providers working with tech companies in the past. But now, firms are moving to Santa Monica specifically to tap that area’s growing tech community.

“Given how much the technology and venture market here has really accelerated in the last few years, the firm saw an opportunity,” Young said. “Being the first of the Silicon Valley firms in town was definitely enticing.”

Moving in

Cooley has set up in space on Second Street and has already signed 135 clients, many of which are within walking distance.

The tech community has widely supported Cooley’s move. It’s the first of the large Silicon Valley law firms to open in Los Angeles.

“I think it’s a huge endorsement of the area,” said Jason Nazar, founder of online document provider Docstoc, a Cooley client. “They’re making an investment. Over the next 20 years, they see L.A. as an emerging community for tech companies.”

Several people in the tech community point to the role of startup accelerators in drawing attention to Los Angeles. Silicon Beach accelerators such as MuckerLab, Launchpad LA and Amplify, which provide early stage companies with funding, work space and other resources, can propel dozens of companies into the ecosystem every quarter.

“It’s like the stars are aligning,” said Kevin DeBre, another of Stubbs Alderton’s partners, along with Akselrud, Louis Wharton, Ryan Azlein and 13 others. “They are really fostering the growth of entrepreneurs.”

Because of L.A.’s sprawl, service providers such as accounting firms and real estate brokerages have traditionally set up shop in central locations such as Century City or downtown Los Angeles. Even firms that specialize in tech need access to their clients in Pasadena, the San Fernando Valley and Westside.

Stubbs Alderton opened its first office in Sherman Oaks because of its easy access to freeways, Akselrud said.

But as startups have clustered in Santa Monica and surrounding neighborhoods, it has started to make more sense for the ecosystem to shift west, said Christopher Cooper, managing director of the Southern California region for Toronto real estate brokerage Avison Young. The firm recently expanded into Silicon Beach by acquiring Starrpoint Commercial Partners from Randy Starr, who handles the leases for many of Santa Monica’s tech startups.

“You need your West L.A. office in Century City and your downtown office, but Santa Monica is something to really take seriously,” Cooper said. “So your service providers want to be right there and have geography that is compatible with their potential clients.”

Stubbs Alderton, for instance, has worked with Silicon Beach clients such as video game developer Riot Games for a few years. But now that the law firm has a Santa Monica office, it can create stronger ties with those companies.

The firm plans to host parties on its balcony overlooking the Third Street Promenade and schedule panels or discussion groups in its conference room. Stubbs Alderton is also planning what it calls a “preccelerator” program, providing free co-working space and mentorship to a handful of early stage startups before they find capital or enter into accelerator programs.

“We view ourselves as strategic advisers, and that’s the kind of environment we will hopefully facilitate,” Akselrud said. “Having a location in Santa Monica will add to the convenience.”

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