Among the lessons Adam Miller (MBA/J.D. ’94) took to heart when he graduated from UCLA Anderson was share success. As founder and CEO of talent management and recruiting platform Cornerstone OnDemand, Miller makes a priority of collaboration across L.A.’s tech landscape, in part to keep funders interested in supporting the vast variety of home-grown startups in the region.
Miller delivered the keynote address at UCLA Anderson Forecast’s September 2019 conference, whose theme was “The Tech Wave: An Endless Summer in Los Angeles?” Los Angeles, he said, creates a culture of cooperation because there isn’t as much competition between various tech companies as there is in Silicon Valley.
“Capital here is increasing, not decreasing. This is a really good time to be in L.A.”
During the conference, Miller, UCLA Anderson economists Ed Leamer, David Shulman, Jerry Nickelsburg and William Yu, and a panel assembled by Anderson’s Easton Technology Management Center all noted that L.A. is fast becoming the most competitive tech ecosystem — and Miller cautioned this may change its character somewhat, as white-collar salaries rise and encourage the high turnover that Bay Area tech firms experience.
L.A. has traditionally retained talent, he said, as well as a diversity of thought he believes Silicon Valley lacks.
Cornerstone OnDemand was incubated in Miller’s New York apartment and formally founded in 1999 in Los Angeles — which surprised his Anderson cohort because the expectation was that anyone launching a startup would try it in Silicon Valley. In terms of technology companies, L.A. “was like being alone in the desert,” he said. Noticeably absent in Los Angeles were mentors, for instance, and essential capital.
“It wasn’t socially acceptable to be in tech in L.A.,” he said. “Real estate and entertainment, perhaps consulting or banking — those were laudable industries. Anyone starting tech in L.A. did it because L.A. is a great place to be.”
In addition, he said, “companies had to be frugal because capital was so hard to find.” Miller’s challenges also included finding professionals with actual technology experience. He said, “There were no expert marketers in software development or tech. You had to hire people based on potential, not particular expertise or skills. People were not in the tech space in L.A.”
Eventually, the L.A. tech ecosystem emerged with the first wave of mentors who had done A, B, C and D funding rounds. “You started to have people who actually knew how to do these jobs, who knew what product management was,” he said. “Not just developers, but developers who had operated at scale.”
Miller recalled that it was mostly advice that was available, versus actual capital. But it helped that the cost of starting a business went down dramatically, thanks to advances in cloud technology, though it remains very expensive to scale a company.
By 2008, with a solid team in place and venture capital finally coming through in 2007, Miller had tripled his enterprise software business. Today, Cornerstone is a public company serving 45 million users. The scrappy startup went from a 2,000-square-foot space to its current 120,000-square-foot Santa Monica headquarters.
“Capital here is increasing, not decreasing,” Miller said. By 2018, $6.4 billion in VC funding had been raised in Los Angeles and Orange County. The region sees an increase in general funding from both companies and banks: “ All the banks are now talking about L.A.,” Miller said. And real estate brokers are now laser-focused on tech leases.
Cornerstone’s innovation fund supports an accelerator focused on investing in and collaborating with the next generation of cloud startups. The company engages the L.A. professional community through a tech summit designed to encourage collaboration.
“This is a really good time to be in L.A.,” said Miller, who also leads the board of the Cornerstone OnDemand Foundation and is chairman of Team Rubicon, a leading veterans’ services organization. “You have a number of companies lined up to go public, many successful exits — billion-dollar-plus exits. We’re seeing a really successful ecosystem. You have more and more people qualified to do these jobs. This is very much a virtuous cycle.”