Taking Irvine’s innovation economy to the next level

Irvine is home to flying taxis, blockbuster gaming firms, trendy EVs and cutting-edge, lifesaving surgical devices. Scores of high-tech innovators, providing tens of thousands of well-paid jobs, have been lured here by one of the nation’s best-educated talent pools in one of the world’s most livable cities.

Now Irvine’s leaders want to take that success to the next level. They kicked off the effort this year by releasing a survey of the city’s “innovation economy,” prepared by the city of Irvine and Greater Irvine Chamber of Commerce. The report outlined ways to take advantage of Irvine’s strengths and suggested paths to create more than 21,000 jobs and more than $125 million in new municipal revenue by 2030.

“We’re ready to write the next chapter in Irvine’s business story,” says Dave Coffaro, the chamber’s president and CEO.

The road to growth

The Irvine City Council formally reviewed the report in late January, as an initial step toward developing a new strategic plan, to be unveiled within the next few months.

City leaders know Irvine is at “an inflection point,” Coffaro says. Throughout its 54-year history, real estate development growth has provided much of the tax revenues that fund public services, including police, schools and parks. But as Irvine matures, city leaders – including the chamber, City Council and business executives – need to work harder to help new firms get established, Coffaro says.

“There are so many reasons that it makes sense to innovate here,” he adds. “We have such amazing talent, in such a great location, and a history of innovative entrepreneurs. You talk to one person after another, and you hear all these new ideas. You’re bound to feel the future is so bright.”

A framework for success

Coffaro cites Irvine’s Master Plan, which has guided the city since it incorporated in 1971, as a key city asset. The plan is “a kind of Constitution: a set of guiding principles to help frame what success looks like,” he says, a top example being keeping a healthy balance between housing and jobs. Thus, as Irvine’s businesses grow, city leaders need to help them continue to recruit employees by maintaining homes they can afford close to their jobs, Coffaro says.

The city’s report – based in part on interviews with executives, investors and academic researchers – highlights Irvine’s strengths in three high-tech sectors, which collectively provide more than 62,000 jobs: health care, medical devices and “enabling and creative technologies” – mainly gaming and advanced computing, including artificial intelligence.

The authors zero in on gaming and computing as having the highest potential economic impact over the next six years, ideally delivering as much as $88 million in new tax revenue while generating more than 15,000 new jobs, with average annual wages of more than $135,000.

Special strengths

Advanced computing and gaming companies, including titans such as Broadcom and Blizzard, are already leading employers in Irvine, accounting for more than 22,000 high-paid jobs in 2023. So many gaming firms, including Sega, Notorious Studios and Postcard Game Studio, are based in Innovation Office Park in Spectrum District that the Orange County Business Journal calls the area “gamers’ gateway.” Blizzard Entertainment, Bandai Namco Holdings and Ready at Dawn Studios have their U.S. headquarters a few miles away. When former Blizzard CEO and cofounder Michael Morhaime and his wife, Amy, embarked on a new gaming venture, Dreamhaven, five years ago, they doubled down on Irvine, locating two new studios here with hopes of improving on Blizzard’s success.

“This is a very exciting time for Dreamhaven,” Morhaime told an audience at Irvine Barclay Theatre in March, adding that his company’s mission “is about nurturing communities and fostering experiences that bring people together in positive ways.”

Artificial intelligence is another fast-growing part of Irvine’s computer industry, which local leaders have increasingly been working to boost. From 2008 to 2023, AI-related investments throughout Orange County – including in such Irvine stars as Alteryx, Medtronic and Syntiant – jumped from roughly $23 million to nearly $3 billion.

Yet Irvine’s innovative strengths extend well beyond games and computing. The city is also a leader in medical devices and health care innovation, including advanced diagnostics, genomic sequencing and telehealth technologies. Investments in health care innovation could help generate more than 3,300 high-paid jobs for Irvine, the report says.

Clean-energy innovations, including Irvine’s burgeoning electric vehicle industry, could also help fill city coffers, the report predicts, estimating a potential gain of $32 million in local taxes from that sector.

Irvine’s EV hub includes entrepreneurial achievers such as Noodoe EV, which makes EV charging stations; Enevate, which develops advanced EV battery technology; and Rivian, an electric truck manufacturer that just got a $5 billion investment from Volks­wagen and opened a new design studio in Spectrum Center in March.

“Irvine is so safe, so well-positioned geographically, and it was so easy for us to tap into the local community that I think it would have been tough for us to survive anywhere else,” says Michael Cannavo, a cofounder of the e-bike company Super73, which had its headquarters in Irvine for seven years.

Next steps

To build a more prosperous, resilient economy, Irvine needs to compete with other successful tech hubs, such as Research Triangle Park in North Carolina and “Medical Alley” in Minnesota, the report’s authors say.

One important step, Coffaro says, must be “a coordinated, collaborative effort to market to investors, to say here’s why you should invest in Irvine innovation. We haven’t really had that yet.”

To date, such support for local businesses has come mostly from Irvine’s city manager and business-leader volunteers. But that’s likely to change soon, said one official involved in the report, as city leaders start to focus on the need for more robust business growth.

“Every symphony needs a conductor,” the official said. “So what we’re doing now is aligning our resources and assets so that we can all row together and row faster.”

Irvine’s government has also begun to take steps to improve the business climate for innovators, Coffaro says. In January, the City Council said it would waive business license fees for any company with 10 or fewer employees, a move Coffaro described as “not a huge dollar amount but a really good message.

“It’s one step in a journey to say: We want businesses to come here, and especially small businesses, because we know they are the backbone of innovation.”