Economic Development Strategy for the Central Coast (with notes)
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Presentation given December 12, 2013 at California State University Monterey Bay by Bud Colligan, Founder and CEO of South Swell Ventures.
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Economic Development Strategy for the Central Coast (with notes)
- 1. Economic Development Strategy for the Central Coast BUD COLLIGAN SOUTH SWELL VENTURES DECEMBER 12, 2013 CSUMB/FORA
- 2. Employment on Central Coast 2012 SANTA CRUZ COUNTY Professional & Business Services 10% MONTEREY COUNTY Professional & Business Services Retail Trade 7% 9% Agriculture 9% Retail Trade 12% Agriculture 29% Government 21% Other Services 17% Other Services 22% Education & Health Services 14% Tourism 12% TOTAL EMPLOYEES: 96,900 Source: CA Employment Development Department Education & Health Services 8% Government 18% Tourism 12% TOTAL EMPLOYEES: 173,100
- 3. Slow Growth in Ag & Tourism 2002 2012 1.7% CAGR FLAT SANTA CRUZ COUNTY AG & TOURISM JOBS Source: CA Employment Development Department MONTEREY COUNTY AG & TOURISM JOBS BUD COLLIGAN SOUTH SWELL VENTURES
- 4. Seasonal Employment 2012 200,000 180,000 160,000 140,000 Monterey Co. 120,000 Santa Cruz Co. 100,000 80,000 Source: CA Employment Development Department BUD COLLIGAN SOUTH SWELL VENTURES
- 5. Residents & Taxes Leave Daily
- 6. Loss of Workers & Revenue • 24% of Santa Cruz residents leave county for work daily • 85% retail “leakage” due to out-of-county purchases Source: Census Transportation Planning Package, 2006-2008; BAE 2013 BUD COLLIGAN SOUTH SWELL VENTURES
- 7. Violent Crime on the Central Coast SANTA CRUZ 40th of 58 Counties MONTEREY 41st of 58 Counties Source: www.countyhealthrankings.org BUD COLLIGAN SOUTH SWELL VENTURES
- 8. Uninsured on the Central Coast SANTA CRUZ: 18% 24th of 58 Counties MONTEREY: 24% 57th of 58 Counties Source: www.countyhealthrankings.org BUD COLLIGAN SOUTH SWELL VENTURES
- 9. Teen Pregnancy SANTA CRUZ COUNTY: 3% 22nd of 58 Counties MONTEREY COUNTY: 6% 51st of 58 Counties Source: www.countyhealthrankings.org BUD COLLIGAN SOUTH SWELL VENTURES
- 10. High School Drop Out Rate SANTA CRUZ COUNTY: 14% 21st of 58 Counties MONTEREY COUNTY: 25% 56th of 58 Counties Source: www.countyhealthrankings.org BUD COLLIGAN SOUTH SWELL VENTURES
- 11. Preparing for 21st Century Jobs? SANTA CRUZ COUNTY 45% of HS Grads Meet CSU/UC Entrance Requirements MONTEREY COUNTY 33% of HS Grads Meet CSU/UC Entrance Requirements Source: Education Data Partnership: CDE, EdSource, and FCMAT BUD COLLIGAN SOUTH SWELL VENTURES
- 12. But.…We Have Lots of Assets
- 13. Superb Colleges and Universities BUD COLLIGAN SOUTH SWELL VENTURES
- 14. Unparalleled Natural Beauty BUD COLLIGAN SOUTH SWELL VENTURES
- 15. Great Farm Land BUD COLLIGAN SOUTH SWELL VENTURES
- 16. World Leader in Marine Science BUD COLLIGAN SOUTH SWELL VENTURES
- 17. First Rate Creative People BUD COLLIGAN SOUTH SWELL VENTURES
- 18. Large Bilingual Population BUD COLLIGAN SOUTH SWELL VENTURES
- 19. Educated Workforce SANTA CRUZ COUNTY BA/BS: 30% Graduate Degree: 22% Source: U.S. Census Bureau 2011 MONTEREY COUNTY BA/BS: 29% Graduate Degree: 22% BUD COLLIGAN SOUTH SWELL VENTURES
- 20. What Does an Innovation Economy Look Like? BUD COLLIGAN SOUTH SWELL VENTURES
- 21. Pre-Conditions of Innovation Colleges & Universities: Research Centers: Living Environment: Business Leadership: Innovation Mentality: BUD COLLIGAN SOUTH SWELL VENTURES
- 22. Innovation Infrastructure • Water • Affordable Housing • Transportation • Broadband • Electric Power Source: CLV Report May, 2013 BUD COLLIGAN SOUTH SWELL VENTURES
- 23. Shared Vision - Collaboration • Shared Goals • Cooperative Decision Making • Shared Advocacy • Shared Responsibility Source: CLV Report May, 2013 BUD COLLIGAN SOUTH SWELL VENTURES
- 24. Vision Diversified Small Company Economy… Leveraging Distinct Regional Assets… While Preserving & Enhancing Our Environment BUD COLLIGAN SOUTH SWELL VENTURES
- 25. Diversified Small Company Economy • Agriculture • Education • Organics • Wine • Marine Science • Health Care • Food Products • Retail • Technology • Manufacturing • Genomics • Distribution • Recreation • Services • Tourism & Eco-Tourism • Non-Profit BUD COLLIGAN SOUTH SWELL VENTURES
- 26. Leveraging Distinct Regional Assets • Agriculture: Region’s Largest Industry • Organics: CCOF, UCSC Organics Program: CASFS • Marine Science: 24 Institutions in Monterey Bay • Food Products: Leverage Agricultural Advantage • Technology: Proximity to Silicon Valley; Local Talent • Genomics: UCSC Center & Genomics Browser • Gaming: Innovative Companies • Recreation: Legacy of Innovation • Tourism & Eco-Tourism: Ocean, Redwoods, Mountains, Boardwalk, Pebble Beach, Aquarium BUD COLLIGAN SOUTH SWELL VENTURES
- 27. While Preserving and Enhancing our Environment • Small Companies: Focused on Local Assets, Tailored to Size of the Community • Local Jobs: Less Traffic/Pollution • Environment: Smart Growth, Knowledge Industries, Organics, Protect Natural Beauty and Farmland • Families: Kids Can Find Jobs Locally, Stay Together • Increased Tax Base: Pay for Public Services BUD COLLIGAN SOUTH SWELL VENTURES
- 28. Entrepreneurial Eco-System COLLEGES & UNIVERSITIE S ATTRACTION OF TOP TALENT TALENT INTELLECTUA L PROPERTY COMPANY SPIN-OFFS CROSSFERTILIZATIO N CAPITAL GRASSROOTS ECO-SYSTEM BUD COLLIGAN SOUTH SWELL VENTURES
- 29. Capital Central Coast Angels BUD COLLIGAN SOUTH SWELL VENTURES
- 30. Central Coast Brand Today BUD COLLIGAN SOUTH SWELL VENTURES
- 31. Regional Brand World Class Innovation BUD COLLIGAN SOUTH SWELL VENTURES
- 32. Food/Supplements BUD COLLIGAN SOUTH SWELL VENTURES
- 33. Wine BUD COLLIGAN SOUTH SWELL VENTURES
- 34. Agriculture BUD COLLIGAN SOUTH SWELL VENTURES
- 35. Organics BUD COLLIGAN SOUTH SWELL VENTURES
- 36. Marine Science BUD COLLIGAN SOUTH SWELL VENTURES
- 37. Technology BUD COLLIGAN SOUTH SWELL VENTURES
- 38. Technology BUD COLLIGAN SOUTH SWELL VENTURES
- 39. Genomics BUD COLLIGAN SOUTH SWELL VENTURES
- 40. Gaming BUD COLLIGAN SOUTH SWELL VENTURES
- 41. Recreation BUD COLLIGAN SOUTH SWELL VENTURES
- 42. Tourism BUD COLLIGAN SOUTH SWELL VENTURES
- 43. Regional Political Leaders • Develop shared vision and time horizon • Agree on measurements • Create regional advocacy/monitoring group • Pass public policy on infrastructure • Create policy framework for targeted business
- 44. Private Sector Leaders Invest in your piece of the vision • Education: research, tech transfer, talent • Business: build on regional strengths • Labor: train for regional mix of jobs • Environmental: steward a good quality of life for all • Non-Profit: focus on a livable community
- 45. Outcomes • Retain What We Love: Quality of Life, Natural Beauty, Clean Environment • Decreased Unemployment • Increased Tax Base Supports Public Services • More People Working Where They Live • Better Community Health Indicators • Kids Can Stay Home With Good Jobs • Virtuous Cycle of Talent, Innovation, Creativity & New Opportunities BUD COLLIGAN SOUTH SWELL VENTURES
Notes de l'éditeur
- I’m going to talk about:* Employment situation on the Central Coast* Community health indicators* Assets of our community* Pre-conditions for innovation* Economic development strategy* Branding ideas* Next Steps
- SC and Monterey Counties both have large government and quasi government sectors (health and education)Largest private sectors are agriculture and tourismMonterey County is more heavily weighted to agriculture ($4 billion industry) and SC County is more diversified, albeit with 35% of employment in government, health care and education.[Total Civilian Employment is 201K in MC and 134K SCC; population is 420K MC and 265K SCC]
- Can we rely on these two pillars of private sector employment for growth?From 2002 – 2012, employment growth in ag and tourism in SC County is flat, and in Monterey County grew by 1.7% CAGR. Conclusion: we need to look at other sectors for growth and diversification.
- On top of that, ag and tourism drive high seasonality in employment, particularly in Monterey County (almost 50,000 workers).We have learned that seasonal jobs also carry with them challenges in providing health care, education and housing for the seasonal workforce.
- We’ve all seen this picture on Hwy 17; and similar such pictures on Hwy 68 or weekends on Hwy 156.
- In SC County, besides the traffic and pollution from 20K cars per day going over the hill, 24% of SC County residents leave the county for work daily…the highest percent of any county in CA.This and other factors result in 85% retail leakage in SC County, and sales tax is one of the primary ways that local government funds itself.
- Let’s look a few more indicators of the Central Coast community’s health:Both counties are in the upper 1/3 of all CA counties in terms of Violent Crime. SC County has one of the highest property crime rates.
- 24% of all residents of Monterey County uninsured—57th worst out of 58 counties in CA.SC County about the middle of the pack.
- 6% teen pregnancy rate in Monterey County—6 of 100 girls ages 15 – 19 will become pregnant this year. 3% in SC County.
- Our high school drop out rates are high—25% in Monterey County, 56th of 58 counties. 14% in Santa Cruz County but Pajaro Valley School District is closer to Monterey percentages.
- And even when kids graduate from high school, are they ready for 21st Century jobs?Many blue collar jobs NOW in agriculture, manufacturing, auto repair, telecommunications require math, computer and technical skills—if students can’t meet UC/CSU entrance requirements, even if they don’t want to go to college, will they be able to perform these jobs?
- So that’s the present situation, resulting from the current economic and policy framework we have been following.Equally important are the assets on which we can build.
- Superb colleges and universities: UCSC, NPS, Defense Language Institute, Monterey Institute of International Studies, Hartnell College, Cabrillo College, and CSU Monterey Bay.
- We have surpassed Scripps and Woods Hole as the preeminent leader in marine science.
- With the growing importance of Mexico and Latin America, CA should lead the way in creating partnerships and cross-border economic gains.
- Because of our higher education institutions and our great living environment, we have lots of smart people here!
- The rest of this century is going to be about invention, innovation, a connected mobile society, smaller, nimble companies, multi-cultural integration across borders, with an emphasis on knowledge workers. We don’t control these trends, but we can figure out how we can adapt to them while preserving what we love. I would argue that many of the trends actually favor our position, if we make the right investments now. What might this innovation economy look like?
- Knowledge side: these are my qualitative assessments:Colleges and Universities: we’re young in terms of research compared to Stanford and UC Berkeley, but we’ve got a good start: strong engineering school at UCSC, language and multi-cultural programs and talent, specialized areas like genomics and game design.Research Centers: most in marine science, but quite broad: underwater vehicles, sensors, biology, oceanography, environmental toxicology, deep sea geology, GIS systems, meteorology, climate change, fisheries…Living Environment: 5 starBusiness Leadership: Quality, not quantityInnovation Mentality: Lots of ideas, but do we have the cultural context to turn ideas into products and companies?
- We just looked at the knowledge side, infrastructure relates to the physical side.Areas like water and transportation have been very contentious along the Central Coast.But we’ve also proven to be able to establish good policy in the broadband area: passing ordinances last month in SC County to trench once and install fiber on all construction projects approved by the County, establishing conduit specifications and a master lease agreement for vendors to use County telecommunications infrastructure, making sure permits are related to actual costs, and land use regulations to support broadband deployment.These changes were championed by the Central Coast Broadband Consortium and Supervisor Zach Friend, which is a great example of regional cooperation in one of these key infrastructure areas.
- The CCBC is the type of regional shared goals and cooperative decision making that works.Communities like Boulder, Madison, and San Luis Obispo, that have a strong environmental ethos, have figured out ways for business, labor, government and environmental leaders to come together and work for the largest common good.
- This vision is one person’s view, but perhaps a starting point for a conversation….[text]
- Diversified: Diversification brings balance, avoids single industry setbacks, offsets seasonality, and leverages our people talents.Small: Companies 0 – 1,000 employees—tailored to the size of the community.
- Distinct Regional Assets: Where we have a competitive advantage:Agriculture: Berry Capital, Lettuce Capital, $4B industry in Monterey aloneOrganics: CCOF and CASFS at UCSC—the oldest organics training program at any U.S. university; result: 30% of SC County ag is already organic; 5% in Monterey CountyMarine Science: 24 institutions, 2,100 staff, spending $300M per yearFood Products: Iconic brands, huge business in Monterey already (> $1B) and leverages largest industryTechnology: Both Santa Cruz and Salinas have proximity to SV; SC County has lots of local technical talentGenomics: UCSC Genomics program and invention of the genomics browserGaming: Game design is largest engineering major at UCSCRecreation: Legacy of innovation in mountain biking, surfing, skate boarding, etc.Tourism and Eco-Tourism: takes advantage of our natural surroundings
- Any successful new business in this region needs to integrate its business with the environmental values of the community.Small companies: Tailored to the size of the communityLocal jobs: less commuting/pollutionFamilies: Keep kids local/families togetherIncreased Tax Base: Pay for public services in health care, education, and public safety
- The best way to have this future is to create it—through an entrepreneurial eco-system that starts with research and intellectual property, applies talent and capital, and gradually develops the grass roots eco-system to self-perpetuate—creating companies, spin-offs of those companies, cross-fertilization of ideas and ultimately a close partnership and symbiosis with the educational institutions in the area.
- Recently, I’ve taken the initiative in the Capital area bringing California’s largest micro-lending institution, Opportunity Fund, to SC and Monterey Counties and doing the same with one of the best business advising organizations, Pacific Community Ventures. Both are focused on capital and advising needed in lower income communities. I’ve also just started Central Coast Angels, focused more on capital and advising for tech, marine science, farmtech, food and recreation start-ups.My point: we all have to do our part to make this vision a reality. Individual initiative matters, and helps the eco-system grow.
- When you think of our brand today, it’s primarily oriented around the Central Coast being a tourist destination.
- I think our brand can be inclusive, but revolve around the concept of innovation—for all diversified sectors:Idea: Invent Your Future Here
- And we’re doing it….
- The usual narrative about tech on the Central Coast is about companies that have left or missed opportunities (Seagate, Digital Research, Borland, SCO, etc.).But the companies in this slide have been built from local technical and business talent, and in some cases are veterans of companies that left (the people stayed!). And there are many new start-ups that hope to join them.
- We have lots of technical talent…some of them work in Silicon Valley and get on buses every morning (or drive themselves). Many would enjoy working closer to home!
- There is a need for a non-profit organization that represents all elements of the community: education, business, environment, labor, non-profits (similar to Valley Vision in Sacramento, Economic Vitality Corporation in San Luis Obispo, or Joint Venture Silicon Valley. Such an organization would collesce all points of view to publish a consensus economic development strategy, monitor it, and hold public and private officials accountable for progress in achieving it.On infrastructure and policy, we’ve got to get to:“Yes, if….” instead of “No, because…”