Four years ago, Zappos owner Tony Hsieh wanted to move the headquarters of the company to downtown Las Vegas. Not the infamous Strip — but into the former City Hall building in what’s known as the East Fremont district.
The problem: The area had few local businesses, was crime-ridden and filled with old, derelict buildings. His employees didn’t want to move. So the multi-millionaire — who lives in an Air Stream trailer — put $350 million of his personal money into a revitalization program.
The goal, says Maggie Hsu, was to revitalize the area within five years. The company is on year four, she said, and there’s still work to be done.
“We have a long way to go,” she said. “But we are doing tis as quickly as we can — and that’s where the money helped. It helped us do this at a very fast pace. I think it can still be done with smaller efforts, but not as quickly.”
Hsu spoke Wednesday night to an audience of about 100 people as part of the first speaker in a new series put on by the Downtown Partnership. She showed the crowd a video of what’s been accomplished as part of the Las Vegas Downtown Partnership.
The project bought 42 acres of land in the area, and in two weeks, renovated the former Gold Strike casino into a co-working space with a 24-hour coffee bar and restaurant. It created indoor games — oversized corn hole games, chess, and outside, beer pong using trash cans.
Next, they created a “container park” — a place where micro-business owners can test out concepts and ideas before committing to a full brick-and-mortar store. The smaller space is cheaper, and allows owners to fine-tune business concepts, she said. During the day, the park is filled with families, shopping and playing in the playground and on the Swiss Family Robinson tree house and slides. At night, it’s adults-only and is the site of music shows and festivals.
“We invented our own metrics for this,” Hsu said. “We weren’t looking for return on investment, instead we wanted return on collisions, but in a good way.”
The goal, she said, was to create interactive spaces where people could serendipitously “collide” and share ideas. From there, a culture and community are created, she said — and innovation thrives. Hsieh invested in those ideas and the result is 150 new companies in the area, she said.
Hsieh spent $150 million on property, $50 million on small business, $50 million on technology start-ups and $50 million on arts, culture and education — including a vocational technical school for low-risk, nonviolent offenders to learn a skill and then get a job within the project.
The small business investments range from “analog” stores like record stores and book shops, as well as restaurants, coffee shops, clothing stores and a canine day care. One restaurant, called “Eat,” a breakfast-and-lunch cafe, paid back the original investment and is now turning profit, she said.
Not all the investments have been successful. Hsieh invested in a company that allowed ride-sharing through renting Teslas. No one bought into it. Another time, the group decided to turn a parking lot into a fake ice-skating rink — no one came.
“It’s about experimenting with the physical space,” she said. “Putting an unfinished product out there and see how people use the space — that allows you to iterate much faster and get to the kind of product that will be successful.”
And what about in Colorado Springs? Hsu said she spent the day looking over the local downtown.
“I went by where the Olympic Museum is going to be,” she said. “That’s a great location — all those warehouses. You can do so much with all those warehouses. I wish we had something like that. The old hotels had low ceilings and we were limited by that. I would love to take some back with me.”
But the Springs won’t necessarily need a big infusion of cash to start implementing new changes downtown, she said. She pointed to other cities that pooled money to fuel startups and also got local government involved. In one city, investors are pooling together money — capped at a certain amount so no one has total control — to implement change in the downtown and provide startup money.
“There are a lot of ways to accomplish this,” she said. “I believe it can be done, but will have to move slower without the private funding.”
The next speaker is Jeff Speck on Wednesday, March 2. He’s the author of “Walkable City: How downtown can save America one step at a time.” The series is $20 a night, from 5:30 to 7 p.m. at the Edith Kinney Gaylord Cornerstone Arts Center. Click here for more information or to register.