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Incubators BLD Capital, Adventus Launch in OC

Innovation is the buzzword, but the entrepreneurial spirit isn’t limited to those with ideas for a company, but also unique incubation models. The new kids on the Orange County block include BLD Capital LLC and Adventus Ventures.

The former recently converted the first floor of its Newport Beach-based headquarters into an incubator space to house startup companies, and the latter is a medical device incubator sans real estate.

There’s also Costa Mesa-based The Hood Kitchen, which is expanding its service offerings for food entrepreneurs and restauranteurs.

No Limit

BLD Capital isn’t a typical incubator, judging from the virtual reality gaming space it built for one of its companies, BluAtom VR, which develops a haptic virtual reality experience. Haptic technology recreates the sense of touch by applying forces, vibrations or motions to the user. The gaming company’s product suite includes a patent-issued vest and vibrating floor.

“We explored launching our office in L.A. but decided to be in OC. We think there are plenty of untapped opportunities and room for growth, said BLD Capital Managing Director Garrett Gilbertson.

BLD Capital is a two-member LLC, the majority of its investment dollars provided by Principal Doug Pak, according to Gilbertson. Pak is founder and chief executive of BLD Brands, a restaurant investment and operations company he founded in 2007. It has 130 U.S. restaurants.

Pak told the Business Journal he launched BLD’s startup investment arm this year out of a passion for venture building.

“I’m also an entrepreneur myself,” he said. “BLD stands for Building Lives & Dreams’”—and that he’d been unable to find an incubator model he liked.

“And we also have extra space,” he said. The facility totals 26,000 square feet, but Pak said that only 10,000 square feet are being used. An upgrade to existing space is scheduled to be complete by August.

Five companies are currently internally incubated, including BluAtom. Others are LEAN, which makes longboards that are lower to the ground, making them better for long-distance pushes and smooth riding; RiseOnline, a digital advertising platform that handles marketing and fulfillment; online privacy and security device maker Keezel; cloud-based business-management services software developer Ark09.

Gilbertson said Pak views the “new phase” of BLD as a tremendous opportunity. He said BLD Capital is rapidly growing its portfolio of incubated companies. Its space can house about 10.

WeWork for Food

The Hood Kitchen was founded in 2012 as a pay-by-the-hour commercial kitchen. Fast forward 5 ½ years later, and the space has nearly doubled in size to about 10,000 square feet.

“We started with just six hot kitchens and expanded based on the needs of our clients,” said Co-Founder Christie Frazier, pointing out clients such as the Manly Man Co. that specialize in edible “man bouquets” made from beef jerky that require a large area to package.

New offerings include prep stations, a packaging room, conference room and an approximately 1,000-square-foot events space for pop-up dinners, birthday parties, cooking classes, and team building and training. Construction finished in May but is awaiting health department approval. A grand opening is scheduled for September.

The events space is available for booking, hosting its first event last week.

Co-founders Shelby Coffman and Frazier got the idea for Hood Kitchen after getting locked out of the Laguna Beach kitchen they were renting for their catering business. The owner had skipped town—“The lady who was renting to us went to Hawaii. We finished cooking 250 meals in my kitchen,” Coffman said. The pair said Coffman’s kitchen wasn’t certified as commercial.

“We thought, how many caterers are stuck in this unreliable situation,” Coffman said.

Hood Kitchen was designed to be everything they couldn’t find in OC, a safe, clean, affordable and responsibly run kitchen. Applicants pay a $199 initiation fee and by the hour, ranging from $8 for a prep table to $55 for the bakery and studio. Events space is $125 per hour. The facility is available around the clock.

“We have an exclusive chocolatier area for our client [Amy Jo Pedone]. She has been with us from day one when we started,” Frazier said. Pedone is behind Valenza Chocolatier, which makes authentic Italian-inspired artisan chocolate. “She’s been growing and can go out and open her own brick and mortar, but she chooses to stay with us.” The partners are working to bring business resources to the facility and to introduce basic business classes, such as accounting. Coffman said that even culinary entrepreneurs, big and small, need compliance support, accounting, social media marketing, and exposure to grow their food businesses.

They said they’re selective about businesses they bring into the space and don’t discount investing.

Virtual

Adventus Ventures is taking the opposite approach, forging ahead without a physical incubator space. Founder Shawn Moaddeb told the Business Journal he intends to stay lean, operating as a one-man show

Its platform description reads, “A venture medical capitalist and an incubator for medical device startups that provides technical and financial support”—and that’s exactly what it is. Moaddeb said he provides the initial seed capital to startups, and his board members and advisers, which include big names like Roy Tanaka and Randy Werneth—provide the technical know-hows.

Before Tanaka retired, he was the worldwide president of Biosense Webster Inc., a Johnson & Johnson company that develops medical devices for treating cardiac arrhythmias. He currently serves on the board of directors at several healthcare companies, including VytronUS Inc. and BioSig Technologies, medical device startups developing different technologies for treating atrial fibrillation.

Werneth, with 25 years of experience in the medical device industry, is also focused in the structural heart disease space. He recently founded CardioCorX in Carlsbad and previously started several other venture-backed companies, including Acutus Medical Inc. and Ablation Frontiers Inc., which was sold to Medtronic PLC in 2009.

Moaddeb also co-founded several medical device companies. “I don’t provide space. You don’t need those overheads to be successful.”

He said board members and advisers don’t need to put in their own money to take a percentage of the profits. “They are bringing their expertise and network.”

Its portfolio companies include Allevion Therapeutics, which develops the Allevex wearable device that treats essential tremors, a nervous system disorder that causes tremors in the hands and legs; Pressao Medical, a noninvasive intelligent wearable device to treat prehypertension; cerebral aneurysm treatment-focused Temari Medical; ZED Medical, which develops intrabody imaging and tracking to guide a variety of minimally invasive catheter-based interventions; and Vascular Health, a “stealth-mode startup,” according to Moaddeb, developing an at-home over-the-counter monitoring device that measures vascular viability and can transmit continuous wireless data to healthcare providers.

He said a potential exit point for Adventus would be its portfolio company successfully raising a Series A round.

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