The Middletown Press (Middletown, CT)
Thriving in District New Haven
Dozens of startups and established companies have moved to the technology and innovation campus
NEW HAVEN — In April, it had four employees. That soon became 18. Now, six months later, it is up to 24 workers and has opted for private offices, a step up from its co-working shared space beginnings.
The company, established by five recent University of New Haven graduates, is SoluTech which runs Scroll, a firm that engages blockchain technology for data storage, a system it says is unhackable.
It is just one of dozens of startups and established companies who have moved to District New Haven, a technology and innovation campus on a 9-acre former bus company terminal that rivals the Silicon Valley for its amenities and community sharing values.
“That is a very unique usage of blockchain technology, and as a result they are on fire,” David Salinas, co-founder and CEO of District New Haven, said of Scroll. “Most times when a company is that hot, they leave.”
Not SoluTech or others in the same position.
“They invested in, and as a result, we invested in them. Now we all nurture together and they are literally killing it,” Salinas said.
Nathan Pitruzzello, the 22-year-old CEO of SoluTech, who has managed to raise $1 million for the company, said District New Haven provides “exposure to mentorship and guidance” that makes it less intimidating for someone his age to continue to scale up the business. More opportunities have opened up for funding.
Only in operation since May, Salinas is proudest of Drive, which is what he has dubbed the co-working space within the 107,000-square-foot campus, as well as his new partnership with the Holberton
School, which will teach software engineering with a goal of reaching 1,000 students in a few years.
In six months, the District has signed up 200 members and there are some 40 companies in Drive alone, with more than a dozen elsewhere on the site. In three months they project they could be fully leased.
Let us entertain you
While the operation is all about innovative job growth, the entertainment component is also a feature of great interest to the area.
By next month, The Stack, a partnership between the Black Hog brewery in Oxford and Bear’s Smokehouse, an award-winning BBQ place in Hartford, is expected to open. Salinas said other cuisine will also be available, while Black Hog will produce its brew on site.
Given the 5,500-square-foot interior, the restaurant would likely be the largest in the city. The facility also opens to an outdoor patio and beer garden with heaters spaced throughout to extend the outdoor season. Still chilly? You can congregate around fire pits on the property.
Salinas called Jason Sobocinski of Black Hog and Jamie McDonald of Bear among the best purveyors of food and beverage in the state.
Also out back, is a bocce court, a walking trail along the Mill River that goes under the highway to State Street and the beginnings of an amphitheater.
Between the restaurant and the amphitheater, Salinas estimated the site can draw up to 1,000 people.
“I think it is going to be one of the hottest destinations in the state,” given its location off Interstate 91 and close to downtown, he said.
State funds have also been budgeted to dredge the Mill River to allow for kayaking and paddle boarding with a launching area planned and designed by the District.
“I really wanted to do something special with this property. The best thing that happens is when people come in and they go ‘I can’t believe this is Connecticut.’ We hear that all the time,” Salinas said. “And that is exciting because we have to show people we can do different things.”
The project has cost about $25 million from various sources, including major brownfield reclamation funds from the state given the sea of oil contamination left behind by the Ct Transit buses. The Holberton School adds another $5 million in philanthropic, state and foundation donations.
After you leave the entertainment area, the first thing you encounter at the entrance, which is at the back of the District, is the Law Lab.
Salinas said many law firms came to him to secure a place in the building, but he said he liked the Murtha Cullina model which gives free entrepreneurial and intellectual property legal advice to members of the District.
“They are not a traditional lease. They are a community member,” Salinas said of the arrangement.
Salinas, whose partner in the District is Urbane New Haven with Eric O’Brien and Carla O’Brien — the entity that is constructing and renovating the property — said they had the initial idea for the land in December 2014.
They won the request for proposal competition in July 2015 and signed a contract with the city in March 2016. Remediation followed, while construction has been ongoing for the past 11 months.
Nontraditional school looking for students
The addition of the first East Coast campus for the Holberton School was a major coup for Salinas who promised the city he was going to add a training center on the site.
Salinas said software engineering talent is in high demand, but a stunted education system has not provided the right training for students to match the jobs.
The CEO gets energized when he addresses this. He said the K-12 education system didn’t have the right programs for computer science until last year and when this cohort of students advances to college, the pipeline continues to remain weak.
Last year in Connecticut there were only 429 computer science graduates, he said. A career job matching firm, GradStaff, found that 70 percent of graduates were not working in the industry for which they were trained.
Salinas said in the end, the lack of the right training has shrunk the number of ready candidates to a handful.
He said you have to open a far-reaching search for talent from all sources.
“Literally everyone has to try to go into the (Holberton) program,” Salinas said, which covers all aspects of software engineering over two years. He said it probably takes 2,000 applicants to find a class of 30 but he hopes to build to 150 students or more a year. Holberton in San Francisco has tripled in size to 1,000 students annually.
Based in San Francisco, the original school was founded by tech industry professionals Julien Barbier and Sylvain Kalache who pitched it in New Haven in early September.
“Nobody knows what are going to be the jobs of tomorrow,” Barbier said at the time. “Nobody knows what the skills will be to fill those jobs . ... Even though Holberton school is about software engineering, our education is focusing on three things: learning how to learn, critical thinking and problem solving, and teamwork.”
Barbier said its process removes human bias, while its payment method lowers the financial barrier to this advanced training.
Tuition over two years is $85,000, but instead of paying up front, students can opt to pay 17 percent of their salary for 3.5 years as long as they are making more than $40,000. They pay nothing if they fail to become employed.
“I fell in love with the model,” Salinas said, who has founded a nonprofit within the District to advance the school. He raised the money through state grants, the Community Foundation of Greater New Haven, local philanthropists, Comcast Business, Lockheed, Indra and Raj Nooyi and other corporate partners.
The large space set aside for the school is being fitted out for classrooms and is expected to be ready by Dec. 15.
Applications are being accepted now for anyone who is at least 18, although he encouraged those who will soon be 18 to sign up. There is no cap on the age of students over 18. The computer makes the decision as to who gets in, “but it is a good opportunity,” he said for people who are motivated and want to work hard.
Salinas hopes to start classes every four months.
He said he will meet any group to get the word out, suggesting among other things, holding a session at the city library where students could use the computers there to apply. “Time is of the essence,” he told the two alders.
Enough money has been raised to run it for five years and Salinas is looking to fill a separate $1.5 million fund for life stipends for students who need an income to support themselves and their families as they study.
As for transportation, he is working on getting train and bus passes for students. “We get that done, everybody wins,” he said.
Homage to New Haven everywhere
When you enter Drive, the coworking section of the compound, you are greeted by a large communal kitchen and information center where there are postings of meetings and tech events of interest to the diverse group of startups assembled in the space behind it.
“It is much more lived in in a good way,” Decker said of the area where food, on that particular day, was set out for sharing.
The long corridors throughout the building are also put to use. One of them recently hosted the CFO of Google and Ned Lamont, the Democratic candidate for governor, and attracted 100 people. “This building acts like a media hub,” he said.
Salinas explained that a co-working space has four components: office space, meeting space, common space and “most importantly community.” Salinas said they built their model on The Grove, the city’s first co-working space, but then took it to a new level.
He said any landlord can slap the first three components together, but “if you don’t have community you fail. We did enough research to know that.”
There are large and small conference rooms throughout the Drive, all of which are named for a neighborhood. “We tried to put some New Haven love in here,” he said.
There is the East Rock room, as well as Lighthouse, Prospect Hill, Westville, Wooster Square, Oyster Point, City Point and Broadway which has an 1879 map of New Haven “just to remind people where we come from.”
There is the typical conference table and chairs in some, but others featured comfortable furniture if you just want to have a conversation with someone. Throughout there are “phone booths,” small spaces where you can duck in with your phone and computer to have a private moment.
The furniture, which is all on wheels, was made through Hugo and Hoby, a local company that has an office in the District.
To use the Drive for a day is $30; for $299 you can get a floating desk for a month; after that there is a dedicated desk with locked storage space for $400. Lastly there are 72 private offices with adjustable desks and seating for up to seven persons with prices starting at $500 a month.
The facility hosts a gym, as well as yoga rooms and a spin studio, while separately, Crossfit occupies the space that fronts on the 470 James St. property.
Salinas, in planning the District, also added something else the CEO deemed necessary.
An employee, who is a new mother, won’t have to duck into some random space to express milk for her baby at home. There is a private room with a refrigerator and an opaque glass door for her to use. “That’s very important,” Salinas said.
He said it is a misnomer to think there are only consultants, freelancers and startups in the building. A 32-person company is leasing a larger space and others are lining up. There is a company from Ireland and firms in Boston and New York are setting up offices here.
Digital Surgeons, the marketing firm that attracted clients ranging from Lady Gaga to United Technologies Corporation, has relocated to the District. Salinas founded and ran that company for 11 years, but now is dedicated solely to this new project.
New Haven’s role in the state
Everyone points to New Haven and its location halfway between Boston and New York as a great asset. But Salinas sees its location in the state as the base for, more importantly, uniting Connecticut’s cities and becoming the fusion between them.
“What we created here is a hub and now everyone is coming to the hub and they are having conversations here and they are seeing this as a different type of value,” he said.
He said he celebrates successes in the other cities. “In order for New Haven to be successful, Connecticut has to be proud of New Haven and New Haven has to be proud of the other cities,” the CEO said.
He said one of the values of the building is to celebrate everyone’s success and lastly “You can’t hate on your neighbor.”
Salinas doesn’t view the District as a real estate project, but rather as economic development with the emphasis on innovation. “Change is the only constant,” he said.
“If this is the new Connecticut, if this is the new New Haven ... it gives people a little bit of hope because things are changing in the right direction. We are not a big corporation. This is homegrown New Haven. We didn’t get a tax break to build jobs. We created a place where everyone gets to experiment and build stuff and jobs happen organically,” Salinas said.
As for his advice to the next governor of Connecticut: “it is not taxes, it is talent.”
“The entire country has a talent deficiency when it comes to areas where jobs are growing. If we want
to be successful we have to fix that talent issue here,” which covers K-12 policies and being open to disruption and new programs.
“If we want people to believe in the state and the innovation that we have been capable of producing, then we have to start being innovative. What I have said out loud to everyone is, the idea of faster trains from New Haven to New York in an hour are ridiculous and stupid. We should be going from New Haven to New York in 30 minutes or less,” he said.
Salinas said that means conversations with hyperloop technology which goes 750 miles per hour. “That is future proofing your economy. That says ... we are investing for the future. The concept of faster trains to me is like talking about faster horses. It doesn’t make any sense,” he said.
He said arguing with every town for expanded tracks for the next 13 years makes no sense, not in a society where you “hit a button and a cab shows up. You hit a button and food shows up.”
He doesn’t believe people have the mental capacity to wait 13 years for something that may happen.
“We have to elect leaders who think like that,” he said. The other piece of advice is to start celebrating what is here, pointing to those companies in the state who are valued at over $1 billion. He said we allow negative voices to drown out the positive.
If you reverse that, “you will see the energy start to change. That is what the District is about — changing the energy,” Salinas said.