San Diego Serves as a Hotbed for Analytics Tech Cluster—at Least Up to a Point

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the next generation of analytics startups are developing new technologies that help companies optimize their profitability, and in modeling consumer behavior—especially “anything that can forecast or predict consumer behavior.”

Clancy added that, “The advent of cloud computing [also] is a major force in analytics, [stemming from] the ability to process much, much larger data sets for a reasonable amount of money.”

Analytics was born in the financial services industry, Coggeshall said, because that’s where the money is. “First in banking, and then in Wall Street, where small improvements in decision-making—particularly where there are large deal flows—can make a very big business.” But Coggeshall added that analytics has become widely applied in such areas as website search engine optimization, bioinformatics, health care, consumer products, and other industries.

Covario CEO Russ Mann turned the discussion of opportunities in analytics into a momentary pep rally as he enthusiastically listed the “really exciting stuff” underway locally at San Diego-based Accelerys and Illumina, and at Ohio-based Teradata’s San Diego engineering development center. “Teradata is a bastion of high-end analytics!” Mann proclaimed. “Three years from now, or five years from now do we want San Diego to be known as a kind of second tier in analytics, and Lahore, India, or Boston, or San Francisco, to be known as the main cluster?”

But Coggeshall and others said the growth of analytics in San Diego also is constrained in certain ways. It can be difficult to recruit managers and researchers with the necessary skills in computer science, programming, and mathematics here—although a representative of the San Diego Regional Economic Development Corp. said the community just landed $2.5 million for technology workforce training through the San Diego Workforce Partnership.

San Diego also appears likely “to continue to be more of a small company town,” said Kanani Masterson, a software industry recruiter. With a few notable exceptions, such as Qualcomm and perhaps Life Technologies, San Diego’s startup community seems to prefer a build-to-sell business model. That’s unlike Silicon Valley, where many more startups grow to the size of Hewlett-Packard, Apple, Cisco Systems, and Google.

San Diego’s biggest constraint, however, may be the lack of San Diego-based venture capital to invest in analytics startups and to promote the industry here generally. As Clancy put it, “There is no local capital in this area right now to apply to this particular field.”

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Bruce V. Bigelow was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Follow @bvbigelow

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