Start-up hub 1776 creates for-profit ventures arm, taps city biz development official David Zipper as managing director

October 31, 2013

The start-up hub 1776 plans to debut a new for-profit ventures arm early next year designed to assist young firms looking for help breaking into industries heavily regulated by the government.

David Zipper will step down as the District’s director of business development and strategy to serve as the managing director of 1776 Ventures, a position that will require him to seek out firms in such industries as health, education and energy, and connect them with business resources, mentors and contacts in the public sector.

Zipper said he will “help them think about how their services may or may not be relevant to the public sector,” a role he has played in his current position as he offers advice to District-based firms such as NewBrandAnalytics and HelloWallet.

He plans to start at 1776 early next year.

Donna Harris, 1776’s co-founder, said the ventures division will generate revenue through sponsorship deals and membership fees paid by participating companies. It will not, however, provide financial investments as the name might seem to suggest.

“There’s a lot that’s changing in the venture capital landscape right now,” Harris said. “We’re being really thoughtful about what the right vehicle” for investments would be. That may come down the road, she said.

Located downtown on 15th Street NW, 1776 currently provides shared office space for roughly 175 start-up companies, along with events and classes that bring together entrepreneurs from around the Washington region and beyond.

The community hub has focused on start-ups that aim to bring innovations to regulated industries, such as health care, local government and education, leveraging the region’s proximity to federal agencies.

“The things that make Washington, D.C. unique are exactly the things you need to make the ecosystem successful,” she said. “There’s a global viewpoint that education, health care and the like are going to be the next growth industries.”

1776 got its start thanks in part to a $200,000 city grant in February that Zipper helped to orchestrate. Mayor Vincent Gray and other city officials have been fixtures at the community gathering place and its events ever since.

Zipper and Harris said they had no inkling at the time the grant was negotiated that he might work there one day. Rather, Harris approached Zipper about the job less than two weeks ago and Zipper said he recused himself from all city matters related to 1776 in a letter to deputy mayor Victor Hoskins on Oct. 21 .

“Now is the time I was open to hearing suggestions” about new jobs, Zipper said. “I was immediately interested when [1776 co-founder] Evan [Burfield] and Donna suggested this.”

Zipper was hired in 2009 by former deputy mayor Valerie Santos during Mayor Adrian Fenty’s term. An alumnus of Harvard Business School who worked in Michael Bloomberg’s administration in New York, Zipper was tasked with finding ways to grow parts of the city’s economy—a break from the office’s traditional focus on real estate projects.

He and Jenifer Boss, who will serve as his interim replacement, authored a signature piece of legislation for Gray, a package of tax breaks aimed at giving LivingSocial an incentive to stay and grow in the city. The online deals company, however, has shrunk since then and is far from qualifying for the incentives.

At the time of Zipper’s departure, the business development unit he led has eight staffers plus two contract workers in China, where Gray, Hoskins, Zipper and other officials traveled to tap investors in the summer of last year.

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