Tech investor Vinny Smith, whose Newport Beach-based Toba Capital is Orange County’s largest venture capital firm, has found a new wave to ride—surf parks.
The one-time chief executive of Quest Software and noted sports enthusiast, whose fortune the Business Journal estimates to be approaching $4 billion, was part of a recent 10-acre land purchase for $54 million in the Los Angeles County city of El Segundo.
The property is part of a larger, 30-acre development alongside El Segundo Boulevard,
previously used by defense contractor Raytheon, which now holds the new base of the LA Chargers.
Developers are planning a pool that will generate waves lasting up to 20 seconds.
“It’s going to be a great wave,” Smith’s development partner, Colin O’Byrne, told the Business Journal. “There’s a high demand for it.”
The site in El Segundo will eventually be one of four inland surf parks that Smith and O’Byrne are planning to spend more than $500 million to develop in Southern California and Las Vegas.
Smith and O’Byrne are planning to spend nearly $175 million on the El Segundo facility, including the recent land purchase, and another $250 million on a 45-acre facility in Oceanside. They have also bought a 66-acre plot in Las Vegas, south of the international airport, where another park is planned.
The El Segundo deal works out to about $5.4 million an acre for the land, which sits about a mile from the southern edge of Los Angeles International Airport.
Developers are hoping to break ground next year.
“We want it to be operational in time for the ‘28 Olympics,” said O’Byrne, who is the general partner for Inland Pacific Companies, who will develop the project alongside Smith.
Much of the site is currently zoned for office, industrial and mixed-use development, according to marketing materials.
Palm Springs Ties
The pair is part of an investment group that has spent $100 million to develop the Palm Springs Surf Club, which originally was a water park and nowadays attracts 150,000 annual visitors.
O’Byrne headed up the development of the 21-acre surf and water park located near the Tahquitz Creek Golf Resort. That project, backed in part by Smith, opened last year and cost around $100 million to build. Other investors of the project included James Dunlop, CEO of Laguna Beach’s Pono Partners LLC, and co-founder of Ambry Genetics, and others who acquired the property and envisioned the desert surf destination.
They are among others who purchased the old Oasis waterpark in 2018 and came up with the vision for the inland desert Surf Destination.
Along with a lazy river and other water park-like amenities, the Palm Springs project has a wave pool large enough to hold 25 surfers at a time. It can adjust the wave for beginners to experts, where surfers go “straight into a fast tube.”
The surf village features restaurants and bars, music concerts and $150 hourly surf sessions. A day pass, which is based on dynamic pricing, ranges from $20 to $40 in late October. Annual membership is also available.
The El Segundo sale, made with locally based Continental Development Corp., closed in May, property records indicate. The buying entity’s ties to Smith and plans for the surf park development were not disclosed until last month and were first reported by CoStar news.
While the El Segundo and Oceanside sites are relatively close to famous wave spots of Southern California, O’Byrne said the surf clubs can eliminate uncertainties like a lack of waves or crowded conditions known at the popular spots.
“Always epic!” is the banner on the Palm Springs Surf Club website. “Your surf paradise in the heart of Palm Springs, CA.”
Chargers Site
The El Segundo site is located about a block from the Chargers’ new 14-acre, $260 million headquarters and training facility. The NFL team moved to the site from Costa Mesa, which served as its base for several years after the team left San Diego.
The Chargers’ former OC base, an office complex dubbed The Hive, was recently leased to Anduril Industries (see the Oct. 13 print edition of the Business Journal for more details).
The one-time Raytheon campus sits roughly a mile and a half from the ocean. Other tenants in the immediate area include Irvine’s Rivian, which leases an industrial building next to the Chargers site.
Tech and Toys
Smith made his initial fortune via the $2.4 billion sale of Quest Software to Dell in 2012. That deal netted him about $800 million.
He subsequently started Toba, an early-stage investment firm “committed to helping create incredible technology companies.” It reports having $2 billion of assets under management, with typical investments said to range from $10 million to $50 million.
Toba’s notable local investments include Alteryx, Tebra, Mavenlink, SecureAuth, Anduril and Synoptek, along with several other investments that include Wallarm, Trace, Wiz, Coupang and many others. The remaining investments are comprised mainly of real estate focused on residential, multi-family and surf amenity development projects.
Other investments of Smith have been more quixotic and less tech-focused, including a short-lived ownership of a pro soccer club in Croatia.
He’s also been active in philanthropic circles, heading up several nonprofits that focus on different causes.
The website for the Walking Softer foundation, a Wyoming-based nonprofit founded by Smith and his wife, Victoria Smith, that backs environmental programs, notes that his “current entrepreneurial focus is on building surf parks.”
There are reported to be nearly two dozen surf parks either open or under development across the country, CoStar reports. Among those in the works is the Snug Harbor Surf Park, a five-acre project that would replace part of the 15-acre Newport Beach Golf Course. A city council hearing for the proposed development is expected late this month. Smith isn’t reported to be involved in that OC project.
