Tony Hsieh’s contribution to Downtown has been controversial but it’s no great stretch to say that the area is livelier than it was before. In times past, the only reasons to go downtown were to gamble, pay a traffic ticket, or serve jury duty. Hsieh’s infusion of capital and positive PR into the area has made it someplace to go for a good, non-gambling time. He has taken over the monthly First Friday bacchanal and made it bigger than ever (to the tune of some 20,000+ patrons/month), moved the Zappos.com headquarters downtown and brought much of its workforce there, as empty condos in the massive Ogden building were converted to affordable apartments.
True, Hsieh has made mistakes. By staking $350 million on his Downtown Project and broadcasting his property-acquisition intentions in advance, Hsieh has become something of a mark. He paid $6 million an acre to acquire the low-rent Dragon Hotel. For the small Gold Spike casino, he forked over $11 million an acre. He got the Western hotel-casino for a relative bargain -- $14 million – then closed it. He kicked gambling out of the Gold Spike, saying it was counterproductive to "trying to help build a community." On the one hand, he has bestowed generous, annual matching grants on Las Vegas Little Theatre. However, more ominously, he deployed his own police force, to supplement Las Vegas Metro cops.
People tend to distrust Hsieh because of his use of rhetoric like "return on connectedness" and other fuzzy Hsiehspeak. Also, many of the businesses Hsieh had lured to Downtown have been failing to show a profit. In late August 2014, Hsieh called a meeting to announce a curtailment of the Downtown Project, including layoffs. Hsieh collaborator David Gould resigned and left town, but not before publishing an open letter blasting the Downtown Project: "‘Business is business’ will be the defense from those you have charged with delivering the sad news. But we have not experienced a string of tough breaks or bad luck … While some squandered the opportunity to ‘dent the universe,’ others never cared about doing so in the first place."
Hsieh responded that, in keeping with his five-year plan, this was the point where operations were intended to be streamlined all along. Some of the achievements generally attributed to Hsieh – the Emergency Arts development next to the El Cortez, the choice of old City Hall as the new Zappos headquarters – were actually the brainchildren of local entrepreneur Michael Cornthwaite.
Holding a meeting with Hsieh has been described by Bloomberg Businessweek as "like being granted an audience with a prophet preparing for a bachelor party." He says he craves anonymity and his conversation is sprinkled with phrases like, "We’re accelerating serendipity" or "collisionable hours." His fans include Mayor Carolyn Goodman, who says, "He has created the most incredible marketing I have ever seen. I love Tony’s spirit. It’s fun to watch him."
Among Hsieh’s more concrete goals has been to try and increase Downtown’s population density by 50 percent (later scaled back to 25 percent). Businesses, dozens chosen out of thousands, are given interest-free startup loans and split their profits with Hsieh. Some of his business ventures mix practicality and whimsy. The Container Park contains myriad boutiques, housed in converted shipping containers. Presiding over it is a giant, metal, fire-breathing praying mantis, although Hsieh claims that he's always had a penchant for llamas and that the vague similarity in shape of the property he's bought up downtown to a llama is pure coincidence.
The fruits of the Downtown project include "a gourmet doughnut shop, a gluten-free pizza place, a sushi bar, a juice bar, a high-end clothing store, and a members-only dog park," as well as an independent bookstore. Fifty million dollars has been set aside to incent high-tech companies to move to Las Vegas. One company, OrderWithMe, relocated all the way from China. Less happily, manufacturer Factorli shut down two months after receiving a visit from President Obama.
Although some of the changes to Downtown are debatable (velvet ropes have started going up outside local bars, as the Strip douchebag crowd crashes the locals’ party) and the future of the Downtown Project is hazy and losing some momentum, the improvements to the area are inarguable and Tony Hsieh is not the only entrepreneur in the mix, with Derek Stevens, co-owner of the D and Golden Gate, also investing heavily in projects like the new Downtown Events Center, while WENDOH Media subsidiary Corner Bar Management has brought new venues to downtown, like Commonwealth and Park on Fremont, plus events like the Glow Run, and now owns a 50 percent stake in the thriving Life is Beautiful music/lifestyle festival. As University of Nevada-Las Vegas Associate Professor of Sociology Michael Borer says, "It’s as if this is a moving train. It’s pretty nice and better than what we had before." Someone just really needs to fix the parking situation, once and for all.
