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How Silicon Valley's Tech Reign Will End
theodp writes "Silicon Valley's stranglehold on West Coast innovation is in danger. The main problem? It's no fun to live in Silicon Valley. Technology is people, explains The Atlantic's Derek Thompson, and more people are choosing to live in cities. And Silicon Valley isn't like a city, it's like a suburb. 'What's happening now,' says author Bruce Katz, 'is workers want to be in Oakland and San Francisco.' So, how might Silicon Valley save itself? 'Silicon Valley is going to have to urbanize,' Katz said. '[There is a] migration out of Silicon Valley to places where people really want to live.'"
So yes, there is a group of tech workers, frequently referred to as "hipsters" that want to live in the urban areas and do their hipster things. However, if you are a tech work with kids, which is actually the majority, you don't want to live in these crime-ridden, urine-scented, no-parking-available urban areas with bad school systems. The pattern I see is that one these hipsters get married and start popping out kids, they move to what people think of as the suburbs. But, they don't necessarily stop being tech workers. And I don't know why TFA says Mountain View isn't having a construction boom. I can count 2 new office buildings and 3 new housing complexes being constructed in its downtown area.
Cheaper, better, faster. You can only pick two.
You can only live in the core urban city if you're wealthy. Being urban education is an abject joke, you live their with children knowing full well you'll be spending over 10 grand a year on private education for them.
The outer ring around the urban center is mainly lower-middle class to poor. These are the children that go to the urban public schools.
The second outer ring is primarily the sub-burbs. Typically 40 to 80 miles out from the core. The people that live here are solid middle class. Their children go to public schools that rate anywhere from fair to very good.
So in summary starting from the center urban city on out ranks as the following group of people. Wealthy - Poor - Middle class. In that order.
Life is not for the lazy.
That pretty much applies to all larger international cities these days. They have become no-go zones for young, professional families with children. I turned down a job offer for an engineering management position in Munich and took a lower-paying job in a smaller city where home ownership is much more affordable. Having four children was probably the biggest factor in my decision, as it's next to impossible to rent an apartment in Germany if you have children, especially four.
The cost of living is insane out there. There are great engineers all over the world.
Including other parts of the US. While SV is an amazing collection of talent (not everyone there, but enough) it's also one of the most provincial places I've ever seen. The idea that good talent can be found elsewhere in the country, at better prices no less, never seems to occur to anyone.
I spent 21 years in the Valley, doing 4 startups and then 8 years in venture capital. It was great, and I couldn't have had the same opportunities anywhere else.
But I got sick of it, and moved right at the end of 2011 (hint: don't have a moving truck drive across the US between Xmas and the end of the year...it freezes itself and all of your stuff) to North Carolina, in the Research Triangle Park area. The Bay Area's crowding, expense and divided society issues began to bug me more and more.
So now I can compare the world's leading tech area with another tech area, way lower on the totem pole.
The cost of living is much lower and the quality of life is much higher in NC for most people. Housing, at almost every level, is one sixth the price of the Bay Area. Average household incomes are about the same (yes, really, about the same....most people in the Valley aren't rich), but a regular family making $50k per year can afford a 2,000 sq ft house on a quarter of an acre in NC. Everything costs less in NC, e.g. my garbage is $16/month instead of $50, water is $21 instead of $100, sales taxes are about 3 points lower, so everything benefits from that, and gas/utilities/groceries are all noticeably lower. Healthcare is great in both places if you have good insurance. Public schools are, overall, better in NC. There are very good local colleges, and there are more PhDs per capita than anywhere else in the US. You don't have Stanford and Berkeley, of course, but you have Duke, UNC Chapel Hill and NC State; I'm really impressed with what comes out of those schools in terms of people and tech.
The weather in NC sucks in July and August; I personally find it too hot and humid. But that's what A/C is for. The rest of the year you have seasons. The Valley has better weather.
BUT BUT BUT.....nothing compares to Silicon Valley for the combination of vast amounts of (venture) capital, vast numbers of experienced tech people, including startup execs, a ton of tech startup infrastructure and a very fluid job market. The RTP area is chock full of startups, with more in the "we make stuff -- chips, materials, devices" category. Capital is much harder to find. There are good banks and lawyers and other services that startups need. Developers flood out of the local schools, but not all stay here. You can pay a developer much less than in the Valley, and (s)he can actually live on the salary (as you can rent a decent HOUSE for $1200, and buy a starter home for $130k).
I've seen multiple attempts worldwide to duplicate Silicon Valley. If I had about $500B and 30 years (I'm a little short of the former, and hope to make the latter), I could replicate the Valley, maybe. But I doubt it. The Valley pioneers were amazing people; check out the documentaries on the subject. They had perfect timing. It's hard to see the same confluence of events happening again, at least in tech.
I had a really good offer for a major Bay Area company a year ago, and after running the numbers, realized that (largely because I have kids) there's simply no way to afford it. Maybe if my wife was also a tech person, but she's not. Ended up taking a job in NYC, as it's considerably more affordable if you have kids...