When I met recently with San Diego entrepreneur Hiep Pham to talk about his latest startup, a Web-based restaurant marketing tool called TipCity, I was reminded that this area was once a healthy hotbed for networking and telecommunications startups.
I later wondered if Pham had any insights into the climate for tech startups in San Diego, and he agreed to a Q&A I’ve published below. But first a little background:
Pham told me he had been working in satellite-based communications at Hughes Network Systems in 1995, when he was recruited by Japan’s Uniden Corp. to start a wireless R&D Center. “They asked me to go to San Jose or Dallas,” he recalled. “I said that the center of wireless R&D was San Diego, and that’s where they needed to be.”
Pham, who is now 53, seems like an archetypal American entrepreneur to me. He says he grew up in a family of 13 kids in Dalat, a mountainous region in Vietnam, and spoke English as a foreign language. He got a scholarship to study electrical engineering at McGill University in Montreal, Canada, and remembers working two jobs to stay in school. He also remembers feeling so tired that he often fell asleep while riding the bus on his way home.
“Most of my brothers also left [Vietnam], either by boat or by walking across the border,” Pham says. “My family owns about 30 restaurants now in Canada.” Pham says
Pham says he also owned a restaurant in Canada to help to support his brothers as they arrived from VietNam. He later transferred ownership to them and left to continue his engineering career in the U.S. “Working and owning a restaurant gave me a great understanding of the challenges and problems of the business, which helps to formulate the idea of TipCity,” he says.
Pham counts the Uniden R&D center in San Diego as his first startup. Three years later, in 1998, he left Uniden to start his own company, Widcomm, a San Diego telecom startup that became the leading global provider of Bluetooth software. In 2002, after four years as Widcomm’s founding CEO, Pham was named as Ernst & Young’s San Diego telecom entrepreneur of the year. And on April 19, 2004, Irvine, CA-based Broadcom (NASDAQ: [[ticker:BRCM]] acquired Widcomm in an all-stock deal that was valued at $49 million at the time.
Later that month, the MoneyTree report on venture capital investments for the first quarter of 2004 showed that San Diego’s LightPoint Communications got $17 million in venture capital and Astute Networks took in $15 million. Yet even then, venture funding for local networking and telecommunications startups was receding. Of the $284 million that went to 27 companies during the first three months of 2004, MoneyTree reported $193 million in funding for life sciences startups, or 68 percent of the total.
Fast-forward to the second quarter of 2010. The MoneyTree report released last weekend shows that funding for life sciences startups amounted to almost $143 million—or nearly 84 percent—of the $170.6 million that VCs invested in local startups.
So what happened? Here’s our Q&A with Pham:
Xconomy: Do you see companies like Uniden establishing wireless R&D centers in San Diego now?
Hiep Pham: I do not see that a company like Uniden [would] establish wireless R&D in San Diego now, as they can find high-quality
