The Summit Café: Coffeehouse and Tech Incubator

With its copious power outlets, Gouda-wrapped meatballs, and a curated magazine rack featuring vintage Steve Jobs covers, the Summit café sits at the intersection of San Francisco's three most conspicuous tribes: techies, foodies, and yuppies. Yet what separates the Summit from being just another Wi-Fi boîte is the dual-purpose nature of the 5,000-square-foot space. One floor above the Laptop Mafia, the café features a cluster of offices where groups of programmers and developers toil away in an effort to launch the next Twitter—or at least the next OkCupid. Created by i/o Ventures, a Bay Area startup accelerator comprising former executives from MySpace (NWS), Yahoo! (YHOO), and file-sharing site BitTorrent, the Summit is equal parts Bell Labs and Central Perk—and probably the country's first official coffeehouse tech incubator. Every four months, i/o selects and funds a handful of small tech ventures tothe tune of $25,000 each in return for 8 percent of common stock. In addition to the cash, each team gets four months of office space at the Summit, mentoring from Web gurus like Russel Simmons of Yelp, and discounts on all the Pickle & Cheese Plates or White Snow Peony Tea they could possibly need. Since the café opened on Valencia Street last fall, two companies have already been sold, including damntheradio, a Facebook fan management tool. To hedge against any potential risk, i/o also rents half of the Summit's other desk space to independent contractors and fledgling Web entrepreneurs. It's even experimenting with an arrangement in which customers can pay $500 for a dedicated desk—on top of a $250 membership fee.

While the Summit isn't the first café to spawn a startup, it's the first to professionalize the process. Every surface of the eatery's communal tables is occupied with MacBooks, power cables, and messenger bags. "You get cabin fever just working from your house all the time," says Ashwin Navin, the floppy-haired, 33-year-old veteran of the Yahoo! Corporate Development group and one of i/o's four principals. "Sometimes, being able to grab your laptop and enter a café, even if it's a Starbucks, for crying out loud, with the sound of Frappuccinos and other kinds of stuff, and intentionally uncomfortable furniture...."Navin's voice trails off. "Sometimes you just gotta go."

No one would ever mistake the Summit for a Starbucks. The café was inspired by sociologist Ray Oldenburg's "third place" theory. (CliffsNotes version: Everyone has a home, a first place, and an office, a second place. They need a third.) Desi Danganan, the Summit's boyish, 35-year-old managing director, and his creative team—which includes Freddy Anzures, a member of Apple's (AAPL) original iPhone design group—have taken great pains to turn this third place into what Danganan calls "a creative commons" that could pretty much only exist in San Francisco. In a nod to the city's fixation on the locavore movement, a map hangs beside the food counter showing the distances various ingredients traveled to make it onto the menu. The café only uses coffee beans from Blue Bottle, the über-hip local microroaster.

While the Summit is noticeably more polished than many of its neighbors—i/o spent nearly $2 million to get it off the ground—it somehow fits within the rapidly gentrifying, post-collegiate confines of the Mission District, home to the unmarked offices of independent publisher McSweeney's, a custom bike shop, and a hipster-friendly taxidermy store. "We're trying to gather together freethinkers, artisans, foodies, digital entrepreneurs," says Danganan. And, of course, all manner of snobs. Local bloggers mocked the Summit this fall after the café advertised on Craigslist for baristas who "demonstrate a love of coffee and the ability to craft with care and a sense of urgency." A month after its opening, gallery director Marky Enriquez launched the Peek, a rotating exhibit of works hung on the café's curvilinear, distressed wood wall. Architect Heidi Liebes says she chose the wood to warm up the space—not that patrons seem keen to look up from their laptops long enough to appreciate it.

Among the startups benefiting from i/o's investment are three piggybacking on the Facebook operating system: Appbistro, a marketplace for third-party applications; AppRats, which helps viral video stars maximize their 15 megabytes of fame; and damntheradio, a site that helps marketers target fans through their taste in music. In January, damntheradio was acquired by online marketing company FanBridge for a low-seven-figure amount, according to TechCrunch. I/o-sponsored companies that focus on the world outside Facebook, if such a place exists, include Anomaly, which serves Web content personalized to users' preferences. There's also SocialVision, which helps companies leverage online video through social networking, and Skyara, a site that helps users connect with such offline activities as a master workshop with a "parking ticket consultant" or lessons in making balloon animals. Somehow this may become a multimillion-dollar business.

While the Summit is planning on adding a bar later this year, it remains, for the moment, another outpost of Laptopistan. "Right now, it's definitely laptop heavy," Enriquez says. According to Liane Al-Ghusain, the gallery's 23-year-old chief copywriter, "It does feel like an assembly line." Albeit with some perks. "Some days it's great, some days it's not so great," says Nalin Mittal, the 33-year-old chief technology officer and co-founder of AppBistro. "On the whole," Mittal continues, "it's pretty awesome." Ryan Merket, Mittal's 29-year-old partner and chief executive officer, agrees, but he points out one considerable downside of working in a café. "About 3 p.m. or 4 p.m., when the cookies start getting baked—that's probably the biggest distraction," he says, sitting atop a green beanbag in one of the Summit's meeting areas. "I've definitely put on some weight."

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