The reasons for this shift are manifold, but chief among them is the sheer expense of the Valley. The cost of living is among the highest in the world.
One founder reckons young startups pay at least four times more to operate in the Bay Area than in most other American cities. All this is before taking into account the nastier features of Bay Area life: clogged traffic, discarded syringes and shocking inequality.
Here’s what’s happening:
Other cities are rising in relative importance as a result. The Kauffman Foundation, a non-profit group that tracks entrepreneurship, now ranks the Miami-Fort Lauderdale area first for startup activity in America, based on the density of startups and new entrepreneurs.
Phoenix and Pittsburgh have become hubs for autonomous vehicles; New York for media startups; London for fintech; Shenzhen for hardware. None of these places can match the Valley on its own; between them, they point to a world in which innovation is more distributed.
Don’t laugh at this post. I don’t want their politics here but I tell you where some of these folks might end up. Detroit. Especially w/ Ford moving 5000 people to Cork-Town for their E-Car/Autonomous efforts. It fits in w/ the Silicon Valley mobility thing, real-estate is relatively cheap, you want to go high end you can get a place with a view of the water and yes the food scene is on fire.
Because startups can’t compete with Facebook and Google paying developers $100K+ just so they can live like sharecroppers in insanely overpriced housing.
Very easy to answer.
Real Estate is way too expensive to setup a startup.
Everyone now can work remote so why do you need to be there.
SV is not the nice place it used to be back 20 years ago.
I looked at the article for more of its arguments. (I also wondered whether it mentions, such as in a matching ending, that we're no longer drawn so much to Florence in particular. It doesn't.)
Near the end, there's an explicit mention of Donald Trump: we need more immigrants and stuff. We also can use more "government largesse" with more "state spending for public universities," "funding for basic research."
One more passage: "A more even distribution of wealth may be one result [of the decreasing need for people to work physically together], greater diversity of thought another. The Valley does many things remarkably well, but it comes dangerously close to being a monoculture of white male nerds. Companies founded by women received just 2% of the funding doled out by venture capitalists last year."
Here I'm reminded of the recent attention to things like gender diversity, mainly from the left, and to political diversity, mainly from the right. If Silicon Valley were more notoriously conservative, we'd see a lot more complaints in our Centrist Media about those "white male Nerds."
Somehow I have gotten the sense that Utah of all places is becoming a big draw for nascent tech firms. I have no stats, on that, just some anecdotal “we’re moving to Utah” stories that are beginning to stack up.
I’m acquainted with a woman whose daughter is with Google making $275K a year, and her husband is a freelance director for several YouTube series and one on Netflix, pretty decent income as well. They can’t afford the down to buy a house, starters are pushing $2 million where they are. I told the woman to advise her daughter to sit tight, that this is unsustainable when income at that level doesn’t even get you into a starter house. Bubble time, deja vu all over again.
Who in their right mind would want to do real business in that environment, apart from the baseline operational and living cost issues?
The Silicone Valley of the go -go 1980s was an incredible placer to be.
There was an amazing array of superbly talented consultants and sub contractors for every facet of the electronics industry from design, layout, fabrication, software, venture capitol, management and IP sector s as well as prototyping and production engineering to scale up manufacturing capabilities.
It was this critical mass of talented and nimble talent that formed the complex engine that powered the growth of the electronics industry and the Silicone Valley as a whole
As our manufacturing base as been sent off shore, all the talented technical specialists have migrated to follow the manufacturing or they have retired. These specialists have also taught their hard won skills and experience (either actively or by assistants watching) equally talented tech specialists in China, Asia and Mexico/South America to build up their technology base
This has caused a steady, across the board, erosion of the depth and breadth of the technical talent pool supporting the complex engine that drove the Silicone Valley. This trend has been happening all over the country and in all sectors of US economy and it is really killing our technology and manufacturing base.
Thank the Lord Donald Trump understands this and he is putting in place the necessary policies to stop the drain and begin the rebuilding of our steadily declining technical and industrial base. The world is at the brink of another wave of technical revolution. The countries that invest in this new technology will control the economic future of the 21 st Century. Much of the revolution is based on American technical innovation and manufacturing skills and expertise.
It would be a tragedy of epic proportion if we do not execute the investment needed to implement and exploit this technology in our own country.
Until Donald Trump came on the scene, our political leadership under President Obama was doing everything possible to incentive and actually force American companies to invest in these new technologies with the same foreign manufacturing that has been draining our industrial base
Thank the Lord Donald Trump understands this and he is putting in place the necessary policies to stop the drain and begin the rebuilding of our steadily declining technical and industrial base.
Tech workers can live anywhere, just give them VPN access.