South Park Rebubbles

When tiny, two-person Mule Design Studio, a website development company, scored some cheap office space on Second and Brannan in the fall of 2003, South Park was a ghost town. "Everything was achingly empty in SoMa, and the landlord was happy to sign a lease on the spot," recalls Erika Hall, the company's co-owner. For two years, she and her partner held the fort alone, but now the neighborhood—and the industry—is seeing a revival.

The following September, search engine Technorati set up shop nearby, followed by the blogging software outfit Six Apart. Consulting firm Adaptive Path joined the block last January, and Giant Ant Design moved in downstairs in April, just as Odeo, a podcasting company, set up shop next door. Once again, the lines at Caffe Centro, the spot once synonymous with dot-com wheelings and dealings, are long, and it seems we're in for another round of tech mania.

But hold on to your schwag bag; this new breed of tech company has its rearview mirror sharply focused. It may be the same kind that went belly-up before, but this time around, the companies are leaner, wiser, and—get this—actually running with the caution of a real business rather than an ego-pumped free-for-all.

"We're staying small and being strategic about how we grow the company," says Nadav Savio, who runs Giant Ant with his wife, Wendy. Bryan Mason, COO of Adaptive Path, concurs. "People are being more skeptical and really evaluating business plans and the feasibility of ideas before going forward."

What about the free on-site massages and foosball tables? Where's all the flash and whimsy the older companies were known for?

"We did have a Ping-Pong table," Hall recalls wistfully, "but we got rid of it. It was an ex­periment. But we found it kept us from getting any work done." Likewise, Technorati CEO David Sifry says there's no room in his office or budget for those kinds of expenses. But his company is growing, albeit slowly, and, like most of its neighbors, has posted at least a half-dozen open jobs on its website. Sounds like a dot-com bubble that could actually stay afloat.