The Plug and Play Story
Turning Rent into Equity and Building a Startup Empire
Plug and Play Tech Center, now a global startup accelerator, started with a simple yet powerful idea—trading rent for equity. In the 1990s, founder Saeed Amidi and his family ran a Persian carpet business in Palo Alto at 165 University Avenue, a building they rented to early-stage tech startups.
Instead of asking for full cash rent, they accepted equity as payment, betting on their tenants' potential. This bold move landed them stakes in companies like Google, PayPal, and Logitech, and legend has it that these early equity deals resulted in multimillion-dollar payouts. The success of these investments validated the model, proving that offering value upfront in exchange for long-term upside can be a game-changer.
By 2006, Amidi formalized the concept into Plug and Play Tech Center, providing startups with not just space, but funding access, mentorship, and corporate partnerships. Today, it spans industries globally, connecting thousands of startups with investors and Fortune 500 companies.
Why This Model Still Works Today
In today’s world, where many startups have high potential but limited cash flow, this model is still highly relevant. It has been successfully applied beyond real estate, with technical teams such as software developers, designers, and consultants adopting it to work with early-stage clients who can’t afford to pay their full bill upfront.
Offer Value Beyond Cash: Provide critical services—whether office space, software development, or strategic advice—in exchange for equity.
Leverage Corporate Partnerships: Connect startups with larger firms willing to pay for curated innovation.
Think Long-Term: Equity deals may take time to pay off, but one successful exit can yield significant returns.
Build an Ecosystem: Foster relationships by providing services, resources, and networking opportunities to create a self-sustaining growth model.
A Real-World Example
Saeed Amidi’s decision to accept equity instead of cash from early Google founders was one of the most lucrative moves in Silicon Valley history. Although the exact amount is undisclosed, it's said that this single deal contributed to significant wealth accumulation. The model has since been replicated across various industries, with developers and agencies offering services in return for a stake in promising startups.
Takeaway for Today’s Entrepreneurs
Whether you're running a coworking space, a software development agency, or a consulting firm, consider offering services in exchange for equity stakes in promising startups. Providing value upfront while securing a stake in future success can lead to exponential gains and build a thriving business ecosystem.
Think like Plug and Play—invest in potential, not just short-term revenue.
