'Startup Paradise': How Hawaii Is Trying to Set the Stage to Create a '30 or 50' New Tech Millionaires

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Hawaii has long been known as a laid-back tourist destination, but that industry peaked years ago. Now the state is trying to reinvent itself as a tech hub. Silicon Beach was already taken, so some in the ecosystem have branded the effort “Startup Paradise.”

State officials believe they don’t need a whole new industry, just a few big wins. “If you bring 30 or 50 jobs with a $100 billion company, you create 30 or 50 millionaires” who can fund the next wave of startups, said Zach Hernandez, who returned to Oahu after college to run a talent-development startup, told the Wall Street Journal.

It’s already happening in small pockets. Engineers at Normal Corp. build energy-efficient HVAC systems out of a converted café space in Kailua. University of Hawaii students are building hardware bound for the moon. The state is leasing manufacturing space at an industrial park to sublet cheaply to startups that can’t commit to long-term leases.

But not all islanders are hanging loose with the idea. One past effort, a decade of 100% tax credits for tech investors starting in 2001, cost the state nearly $1 billion with little to show for it.

“Hawaii needs one unicorn,” said Ashten Akemoto, a former Normal employee now building his own robotics startup. “You can change a place, you can change perception, you can change everything with one crazy success.”