Maybe you know the Cambridge Innovation Center story. Or maybe you think you do.
Have you ever heard it straight from founder Tim Rowe?
I hadn’t, until Rowe summarized his 15-year project in 10 minutes during last week’s Innovation and the City conference at District Hall.
It was impromptu. He was at the podium to introduce keynote speaker Bruce Katz of the Brookings Institution. But District Hall executive director Carlos Martinez-Vela asked him to say a few words about CIC because, I think, there were a lot of out-of-towners in the house.
Rowe’s account was personal and funny, and it occurred to me that there were probably new nuggets in there, even for the locals. So I’m sharing a condensed transcript of his remarks. It’s a good read, even if you’ve heard this story before.
Rowe: The story is really an organic one. My wife and I met at MIT. We were working in the area. She had a startup idea. I thought I wanted to have a startup idea, but I didn’t really have one. But we both decided to quit our jobs, and I said, “Look, I’ll help you get your startup going while I think about my startup idea.”
The first thing we really needed to do was get some office space, get an Internet line, some furniture, photo copier, some of those things. I called around and actually it was really, really annoying to figure this stuff out. The landlords wanted five-year guarantees and personal guarantees on these leases, so that if the startup didn’t work out you’d somehow sell your house and give them the money.
I was like, “Wait, wait, wait. That doesn’t make sense. This is a startup — it’s probably going to fail.” And they were like, “That’s the problem.”
In the end, we went through all my finances, and they weren’t good enough. My house and everything was not enough. So somehow I convinced my dad to also sign the lease. It was kind of crazy.
The thing we did because we thought the startup might not work — and indeed it did not work; it failed about a year later — was we convinced a bunch of our friends from MIT who were also doing startups to share the space with us. We said, “Let’s all share the space and maybe one of these companies will not fail, and maybe my dad won’t have to sell his house.”
Along the way, somebody came to us and said, “You’re an incubator.” We said, “What’s an incubator?” They said, “Well, you help startups and stuff.” So we tried that. Some West Coast VCs gave us $17 million to give to these startups to help them. So we gave out almost all of the $17 million, and they pretty much all failed. We figured out that we didn’t really know how to do that. Giving out money wasn’t going to be the solution.
This is back in 2001. The dot-com boom was now a bust, and there were acres of empty real estate all around MIT. And we had this crazy idea that maybe we could go back to what we started doing and just invite our friends from MIT to come and do their startups again. So we got out of the incubator business and got back to just handing out space to our friends — sharing it and making the Internet work.
Suddenly we filled up. And we looked at the money, and we were still losing money, but not nearly as much as before. And we had a really crazy idea that if we got a little more space, we’d probably lose less money. And so we did that. Then we got a little more space and started making money, which was just a completely mind-blowing idea.
Since then, we’ve been making money sharing space and not being an incubator. It’s been a lot of fun. Some really cool projects have come out of it.