Four Cal Poly Grads Explain Why San Luis Obispo Is A Hub For Startups

Sidney Collin, founder of De Oro Devices.

By Laura Maranta

What does it take to start a company or small business? Some answers that come to mind: innovative leaders, community, capital and investments, and a great location. It turns out many of these key ingredients exist here on the Central Coast. 

Over the last decade, the Central Coast has seen a swell of entrepreneurship, partly thanks to Cal Poly, support programs from the University’s Center for Innovation and Entrepreneurship (CIE) and its Small Business Development Center (SBDC). Some proof of the region’s success: multiple companies were listed in Inc. Magazine’s 2019 list of “5000 Fastest Growing Companies in America.” 

 “Our Community has proven its support of startups,” says CIE Executive Director, John Townsend, of the local startup scene’s success. “Silicon Valley is still the Mecca. But we have a good thing going. We’re a great place to live and our best days lie ahead.”

Townsend’s advice to those considering starting a business here: “You can do it. You won’t be alone. You don’t have to sacrifice the success of your company by also having an incredibly high quality of life. There is a strong community of others like you that are doing the same thing. You’ll look back some number of years from now and say it was one of the smartest decisions you made.” 

We asked some local companies from various industries and at different stages of development to share their perspective on the startup scene on the Central Coast and San Luis Obispo. These entrepreneurs, all graduates of Cal Poly, have taken advantage of what the region and surrounding community have to offer. 

Wilde House Paper (2015)

Megan Heddinger, Founder + Creative Director | Graphic Communication, 2014

Connor Drechsler, Business Development | Math, 2015

Wilde House paper is a lifestyle stationary company offering a variety of products including art prints, notebooks, calendars, cards, and more. The company offers wholesale products and an in-house design studio for custom projects. Most recently, Wilde House Paper opened a store front on Monterey Street near Downtown San Luis Obispo.

CIE Programs: SBDC

“Connor Drechsler and I started Wilde House Paper in Costa Mesa, California. Moving [back] to SLO was one of the best decisions that we could have ever made. The city offers so many amazing resources like the SBDC that we are a part of. There are a lot of driven people here looking to create cool things, which is a constant inspiration for us. We loved the idea of being able to connect with a smaller artisan community as well as tap into all of the talent that is encompassed in the students here. Some people still see it as “abnormal” to start a business on the Central Coast, especially within the lifestyle category that we find ourselves in. Followers of our brand always think that we are based out of SF or LA because of our aesthetic, but are always pleasantly surprised to find us paving our own path here on the Central Coast. Community is one of the biggest pulls to SLO for us. Not only feeling supported from a community of locals who genuinely value “shopping small” but also from a community of other small business owners who are willing to help where needed! Once the space we currently occupy on Monterey popped up, we knew that this was a perfect next step for us to grow and integrate into the SLO community. Being an e-commerce brand, we love being able to have a physical space that people can come to and experience the brand in real life.” —Megan Heddinger

Flume Water (2015)

Eric Adler, Co-founder + CEO | Mechanical Engineering, 2015

James Fazio, Co-founder + CTO | Software Engineering, 2015

Jeffrey Hufford, Co-founder | Electrical Engineering, 2015

Flume Water helps homeowners save water, money, and protect their home by providing real-time water-use information. The product consists of a sensor, bridge and an app to provide homeowners with cost-saving statistics. Flume Water began as a senior project inspired by California’s drought crisis.

CIE Programs: Innovation Quest, HotHouse Accelerator, HotHouse Incubator, SBDC, HotHouse Annex Coworking

The whole idea for Flume was to help customers understand in real time how water is being used in their home. Me and my two co-founders decided to take it on as a senior project, and we were very fortunate that the engineering college actually allowed a project like this to go through. One of the main things [about SLO] is that it’s affordable. Everything is double the price in San Francisco, employees are twice as expensive, housing is twice as expensive. Having the expenses much lower in SLO makes starting a business easier because you have to raise less capital. And of course people love being in SLO. I think one of the best parts about SLO is we have Cal Poly. Our entire customer support team is Cal Poly interns. The other valuable piece is those people who graduated from Cal Poly 20 years ago. A lot of them are really successful and have been CEOs at their own companies and they want to reinvest back in the community and help grow companies. And there are other community members who don’t have the capital to do that, so they help in other ways, with mentorship or advising roles. Maybe they have been in startups before and they have all this experience they are willing to share and we see all this experience through advisors we have had at the company. We’ve benefited from all of that.” —Eric Adler

Cloud Pathfinder Consulting LLC (2017)

Jesse Grothaus, Founder + CEO  | Econ, 2014

Cloud Pathfinder Consulting is a group of Salesforce Consultants helping small businesses achieve their dreams through Salesforce implementation, administration, and consulting. The company has a mission to employ military-connected individuals who understand what teamwork is truly about. While most of the employees are working remotely, the company headquarters and CEO are located in San Luis Obispo. 

CIE Programs: SBDC 

“I was living in the Central Valley when I started my company, but I knew that the end goal for me was always to get back to the Central Coast. So, I started my company with the expectation that hopefully this would allow me the freedom to move back to San Luis Obispo and within about a year or so it did. I’ve been here since 2007 but [the startup scene] did not exist in 2007 and it is surprising to see how it has grown over the last couple of years. It makes sense the more you think about it. You’ve got the Orfalea College of Business, you’ve got the Cal Poly College of Engineering, you’ve got the HotHouse, the SBDC, and we are just one region south of the Bay Area. When you start thinking about all those things together, it’s inevitable that there’ll be some great spillover here from the startup scene of the Bay Area. There have also been more and more coworking spaces opening, which I think is really helpful for this area. I think that’s actually one of the biggest challenges of starting up any kind of company—real estate. Coworking spaces are a big way that the community helps out. Since moving here, I don’t have a commute and there’s no traffic. People don’t realize what kind of effect that has on your ability as an entrepreneur. It’s little things like that that SLO has to offer, which kind of have this cumulative effect. As a founder your head needs to be in a certain flow state. It’s hard to do that when the boring stuff of life is weighing you down, that typical hustle and bustle, and that hurried lifestyle. When it’s gone it lets you stay in a much better headspace that lets you focus on building your company in a more thoughtful way. If I was still anywhere else, I don’t think I’d be able to do that like I can here.” —Jesse Grothaus

De Oro Devices (2018)

Sidney Collin, Co-Founder + CEO | Biomedical Engineering, 2019

William Thompson, Co-Founder | Psychology, 2012 + MBA, 2018

De Oro Devices is developing creative technology to improve the quality of life of those in need. Their first product, NexStride, is designed to help Parkinson’s patients. 

CIE Programs: The Hatchery, Innovation Sandbox, Innovation Quest, HotHouse Accelerator, HotHouse Incubator, HotHouse Annex, SBDC and Angel Conference

“I think [the entrepreneurship scene here] is much more collaborative than it is anywhere else that I’ve seen. There’s a lot of community support here, not only from people who are involved with the startup scene but also from the rest of the community. In addition to that, the CIE and SBDC provide a great number of resources that I’m not sure other organizations or small business development centers really give to their constituents. I am on the board of the REACH (Regional Economic Action Coalition) and the reason that they wanted me to be involved in that is because they see a key amount of economic development coming from startups starting and growing on the Central Coast and creating jobs here. Everything is integrated into setting one common goal for the economic success of the county and being able to use all of the resources available to do that. I think that’s important. So having startups be involved in that mission and be involved in what the plan looks like going forward is crucial in terms of being able to provide more high paying jobs.” —Sidney Collin

Interview: Professor Chris Hydock

A Q&A with the Assistant Professor of Marketing on his research, covering the effects of brand positions in marketing and how they’re impacted by the polarization of politics. 

By Laura Maranta

Think of the last time you noticed a brand endorse a political candidate or support a social movement. Most likely you can recall a recent example. Over the last few years consumers have become increasingly aware of brands engaging in Corporate Political Advocacy (CPA). To put this terminology simply, companies are declaring their support for political and social movements through marketing. The connection between companies and their political stances has been studied by Cal Poly Assistant Professor of Marketing, Dr. Chris Hydock. His recently published article, “Should Brands Take a Position on Polarizing Political Issues?” can be found in the Journal of Marketing Research and focuses on the effects of CPA, authenticity, and other factors on consumer support. 

Hydock joins the marketing conversation with a background in cognitive neuroscience, which offered him an understanding of human thought and cognition as an undergraduate and graduate student. His transition into marketing was driven by his desire to better understand how humans act in the real world, specifically, the acknowledgement that a majority of our decisions are made in a marketing and consumption context. He brings this perspective to his own research as well as the classroom. “Marketing is the customer facing portion of the business,” he says, “and to do well they need to understand the customers. Their customers are human, so from a psychology perspective and a consumer behavior perspective, we are all about understanding how people make decisions. Every class I tie in some lessons from psychology and consumer behavior to marketing because they are closely related.” 

We followed up with Hydock to discuss the impact of this research, how it has affected his own consumer habits, and where he plans to take his work next. 

Can you give a brief background on your work and why you study what you study? 

I broadly look at consumer behavior and try to use that to generate insights for marketing strategy. One line of my work really looks at the intersection of marketing and politics. The early stages of this project go all the way back to 2013 when we were seeing an uptick in brands engaging in CPA. We started to notice that this was becoming more and more popular and we wanted to think about and understand what the implications were for brands and more broadly ask how marketing and politics might intersect to change how we act as consumers, how brands act, and how that changes society. 

Do you think this research would have had the same value before 2020? What effects do social media and the current political movements have on this research? 

I think the value has been there for the last 10 or so years. I think this highlights the question of whether or not social media has spurred brands to become more engaged in politics or CPA, or is there something else that changed. I actually have another research paper with one of the marketing faculty, that is looking at political polarization more broadly. There has been a lot of research in political science about polarization, which suggests simplistically that the two parties are moving further and further apart. You see that not only are they farther and farther apart in terms of their policies but in terms of how they treat each other and how reactive they are. I think political polarization is what really drove the shift. In the past brands would only interact with their stakeholders through charitable or philanthropic events, things that everyone would support. But as society became more polarized they shifted into thinking beyond just donating money to the Red Cross, or supporting education. Now they donate money to a political campaign or support a specific political policy. Based on my other work, politics is really starting to seep into all other parts of society as we become more polarized. 

Can you speak a little bit about the effect of authenticity and how the bandwagon effect appeared in your research? 

We find that when a brand engages in political advocacy in an inauthentic way, it removes the benefit that brands often see from political advocacy. Stepping back, we see that overall political advocacy tends to be more beneficial for small brands whereas it tends to be harmful for large brands. Essentially, if you are a small brand and want to engage in political advocacy as a way to improve your economic standing, it’s important to note that customer support for you will decrease if they detect that you’re acting in a selfish or self-interested way. In some ways this isn’t too surprising. What was more surprising were the harmful effects of both authentic and inauthentic CPA. If you are a larger brand and you engage in CPA and people detect your motives are inauthentic, it’s also going to harm you in the sense that customers are going to punish you for being inauthentic. But large brands also run the risk that their customers might punish them for disagreeing with their beliefs. Coming back to thinking about what you need to do as a brand, the underlying lesson is don’t let yourself get into a trap where you are just trying to use CPA as a way to gain customers because if it seems inauthentic you won’t get that same benefit. And it could have drawbacks, especially for larger brands, even if it is authentic. 

As society has become more polarized, brands have shifted into thinking beyond just donating money to the Red Cross, or supporting education. Now they donate money to a political campaign or to support a specific political policy. Based on my work, politics is really starting to seep into all parts of society. 

What effect do you think this paper will have on marketing and companies in general? 

Over the last few years we’ve seen brands be a little bit more careful about their CPA and I think that this paper will increase the knowledge of what some of the factors that you need to consider are. We looked at brand size and large market share versus small market share, and we looked at authenticity. But there’s really a plethora of factors that go into deducing what the ultimate effects of CPA might be for a brand. From an academic marketing perspective, there may be a new flood of research that looks at what negatively affects these outcomes. I think brands are doing that on their own already, because they are responsible not only for their own moral obligations but because they are also responsible for stakeholders. As a result, they have to think about these consequences. I think the biggest takeaway of this research [for companies] is understanding their market share. If you’re a smaller share company, there’s a lot less to lose by engaging in CPA and you can even stretch this a little bit further and say there’s a lot less to lose by engaging in any controversial or divisive brand action. 

How much has this research affected you as a consumer? 

I think sometimes a brand might have gone too far and I really can’t justify purchasing that brand or going into that retailer. But at the same time, as consumers, we have a lot of priorities. I think we make a lot of tradeoffs, to the extent that we have easy choices we are going to factor in when processing this information. But I also think there is a limit to how much people are willing to trade-off in terms of their own value in order to support or punish a brand. There are probably going to be categories of consumption where that is easier or more difficult. More of what has come out of this research is that I have a greater disdain for political polarization and the extreme ends of both parties. That has been how it has really changed me. My mindset is more, “Let’s figure out how we can move away from polarization and more towards compromise or finding middle ground.” 

Where do you think your research will take you next? 

We have that paper looking at political polarization and marketing that is finishing up. There, we highlight that CPA is one consequence but we also think about some of the other consequences of political polarization for marketing. You can imagine that it’s going to impact a lot of segmentation and targeting. There’s a lot of thought in marketing that considers how we can better target and segment a more polarized population. We see that political differences go far beyond what someone believes in terms of abortion or tax policy, for example. We see that Republicans and Democrats have different preferences in terms of wanting trucks or cars, or how much they like amusement parks—Republicans tend to like amusement parks more. There are definitely dangers in customers becoming increasingly different from each other. I have another paper that’s looking at some of the other factors that impact the consumer response to CPA and one of the interesting things is that the existing customers of a brand punish it more than the non-customers when they engage in CPA. This data set again will allow us to differentiate general consumers from actual customers and we want to look at understanding how customers versus consumers in general respond to CPA. 



Orfalea Alumni Chats | Joanne Smith

For this Orfalea Alumni Chat, we’re fortunate to have Joanne Smith, EVP and Chief People Officer of Delta Airlines. During this interview, Joanne shares how her time at Cal Poly set her up for success, how she’s leading an 80,000-plus person organization during a pandemic, what makes an exceptional leader, and more.

Listen to the full conversation with Joanne.