I've been in the Kansas City developer market since 2002, and I can report that salaries for senior developers (java and .net) are going through the roof here. 110k to 120k is becoming common. At a very non coastal cost of living.
It's a great time to be a developer in the midwest!
Opportunity risk. How many major software engineering companies are there in the area? If I lose my job in Silicon Valley, I'm in for maybe a 1-3 month job search among hundreds of companies out here. If I lose my job in Nowheresville, USA (I know this because I have lived there), I'm likely to be in for a 4+ month search and it's likely my next job will be out of the state.
A 3 month job search for an experienced developer would be insane in Kansas City. I'd probably start freaking out if it took more than a month, because that's a long time here. I'd expect about 2 weeks, and mostly just because it takes time to get the word out and do an interview or two and negotiate at the place where you eventually accept an offer.
Oh, uh. Wait. I mean there are no jobs here. We definitely do not have tons of nice starter 3br homes under 200K. Do not move here, other experience developers!
If you'd like to be closer to the East Coast, the Scranton area is beginning to gain traction, as it's very accessible from Boston, New York, and Philadelphia.
Cost of living is rock-bottom (an actual Victorian mansion can be <$500k, and a beautiful rental apartment in one of the uber-trendy small towns such as Pittston can be had for $800/mo), the food is excellent, and there's very easy access to beautiful areas for hiking, biking, and fishing with multiple state parks and campgrounds within a short drive. The healthcare is among the best outside of a major medical center. Public education is generally very high quality, with private high schools, universities, and the medical school essentially free to high-performing or low income students.
Community banks are highly prevalent, and they're very willing to make small business loans to pre-profit companies with sufficient credibility. The area is also remarkably entrepreneurial, to the point where one is lionized for the mere act of forming a company, from a tech startup to a restaurant.
There's also been some solid tech exits, such as Solid Cactus, which was for an undisclosed sum, but they were already raking in annual profit in excess of $2 million.
KC is a growing metro area with a low cost of living. That means lots of people opening up new restaurants who couldn't risk doing that in a place where commercial rents are very high.
Same reason Portland and Atlanta punch way above their weight class in terms of food scene.
"Metropolitan areas with the highest employment level in this occupation:"
There's only 40K jobs in SV, and if you go on HN reputation you'd think there's only like 3 jobs in all of Chicago, but the actual number is closer to 20K.
As a practical matter it will not matter much if there are 40K jobs or 20K jobs in a legacy geographic location, because my first choice will always be remote anyway.
Given that almost all jobs on a percentage basis are outside SV, by definition your best next job will almost certainly be out of state no matter where you live, in or out of CA.
It's not just a matter of how many jobs there are, it is also a matter of how many employers there are and how flexible the employers are. An area with 20,000 jobs split between 400 employers may well be better for mobility than an area with 30,000 jobs split between 20. Similarly, an area where employers post laundry list job reqs and get picky about them is not going to be an easy area to switch jobs in, regardless of how many total jobs there are. Tens of thousands of tech job openings are controlled by companies who don't actually believe there is a talent shortage and will treat you accordingly.
Not only that. Number of jobs > number of open job postings > number of actual open jobs > number of job openings available to external applicants > number of job openings that are actually trying to get filled (as opposed to just fishing) > number of job openings actually likely to be filled.
But your right, number of companies is very relevant, since you interview for a company not a single job opening. 30,000 jobs at 20 companies represents 20 chances, not 30,000 chances.
Current labor size isn't a measure of velocity. If people spend less time at a job, then there are more job openings. People leave jobs and get hired quicker.
It's a reasonable concern; it depends on just how nowhere you are, and what your interests are. For example, where I live (Minneapolis), there's a ton of work, but much of it is in health care (including medical devices) or retail or insurance or banking. So if that's not your thing, it could be limiting. 5-6 month winters can also be a big bummer for people who weren't born here.
The job market is awesome in Minneapolis if you're willing to do enterprise. And I love living here. The startup scene is exploding, too - it's not San Francisco, but it's pretty active and we've had a couple of good exits lately (SmartThings, Sports Engine).
Come on, this can't be true even for most developers in Silicon Valley. 3 days seems like an exaggeration (however I also have nothing more to offer than anecdote). Does anyone actually collect average/distribution of days spent looking for a job, broken down by function/industry?
Head hunters are desperate to find anyone with experience. I literally fired the worst developer I've ever had work for me and he instantly found a job. I was amazed.
Wow, hard to believe but I'll take your word for it. The only thing I can guess is he traded salary for a quick decision?
Even if you interview somewhere the next day, it usually takes a week to get an offer and 2 weeks for the company to get its paperwork straight. Let alone counting the amount of time it takes to find someone actually hiring.
An average or median is usually a more helpful guide, rather than what the highest-paid developer is barely "cracking". According to Glassdoor and Payscale, the median/mean for software engineers in Chicago is around $75K:
You see this on HN a lot, someone posts about some guy he knows who's brother's wife's roommate makes $300K at Google, therefore most software engineers in the Bay Area make lots of money. Really?
Working in SV magically makes you a better developer now?
Wow!
Isn't it more likely that there are more bad developers on average in SV than anywhere else as they're so desperate they'll take anyone? If I was struggling to get a job as a developer it'd seem like a natural place to go.
You could blame every job loss on startup babble too. "The burn rate was too high so the let our entire team go", "In my 4 month CV gap I was exploring my own idea for a job-sharing-app but failed to find funding", and on and on...
It makes sense. I would expect the best architects to be in Chicago, the best finance folks in NYC, and the best media folks in LA -- why would tech be any different?
The Bay has a lot of extra draw for really talented developers. For the really good developers it's less about "what job can I get" and more about "what job do I want?". When they have the luxury to work at virtually any company they want, SV is the place to be just by the numbers.
It makes a big difference to students too -- most hot shot developers out of college are going to take an offer from a flashy Bay Area sweetheart over the local healthcare IT shop any day.
> Working in SV magically makes you a better developer now?
I don't think that follows from the comment. You've reversed the causality. The comment was just saying that there's a correlation between better developers and living in SV. Not saying I agree, but it seems likely. Wouldn't it be a self selected group of more driven programmers?
Startup guys are not 'average'. The salary situation for more-than-competent folks are better. I earn better than twice that in Iowa City, without trying. Just consulting part-time.
Well, yeah I know some in KC making 150k+ w2 in health care here, 110-120 is what I percieve as being common here, from switching jobs a few months ago.
Sounds like it. I grew up in Columbus, OH. I was just graduating high school when dotcom bubble was frothing. I dreamed about going out to SV but didn't have the guts to.
Thing is, when I moved out to Seattle, I fell in love with the West. I love the weather and people out here, whether in northern Arizon, or Washington State.
I'm glad things are looking up at the midwest though.
but it's not only a salary to cost of living differential. some of these geographically uninspiring places will have to pay a premium to attract people, and compete with areas with greater potential for high quality of life.
Have you BEEN to Kansas City? I got sent there for work meetings once and I have to admit I dreaded it - but it's got lots going for it, with lots of great cultural history (Jazz!) and some awesome food (BBQ!) and some really interesting places downtown. The people I met there were a whole lot more genuinely nice than most Bay Area folks, too.
YMMV obviously, but if you dismiss most of the rest of the continent as "geographically uninspiring" you're going to miss out on a lot.
Shh, west coast people have a higher quality of life than you! They can drive to better-than-average hikes on weekends! That's such a huge part of their identities that nowhere else could possibly be bearable!
The point I was trying to make is that your belief that access to the mountains is actually the most important thing for lots of people (especially the software developer type) is absurd.
If you're living in a city, your day-to-day lifestyle is going to be pretty much the same anywhere in the US, or really anywhere in the developed world.
The only major downsides to that part of the country are January is really cold and August is really freakin' hot. Also, there's a tendency towards blandness and sprawl, but that's a problem everywhere.
And we have awesome springs and falls with all the beautiful trees. Something I really missed when I moved to Oklahoma for a couple years. They have very few big trees.
> lot more genuinely nice than most Bay Area folks, too.
I noticed that too. I miss that part of the Midwest as well. I am on the East coast now and here people are too aggressive and competitive, even without an obvious reason to be so. I mean they are still genuine, just genuine in their open hostility so to speak.
They say these are just stereotypes and are not accurate, but I don't know, seem to jive pretty well to what I noticed.
Wow, having been in Kansas City and the bay area recently, the bay area has a very low potential for high quality of life. Seattle has a very high potential, higher than Kansas City, but Kansas City beats the bay area.
The bay area is way overcrowded, poor infrastructure, way, way too expensive, and if you want to get out of town for the weekend you fight traffic for 4 hours.
I understand california dreaming... it's been the best marketed state for decades.
Those "geographically uninspiring" places happen to be home to the Great Lakes, the country's biggest rivers, mountains, incredible cave systems, and some of the best climbing in the country (seriously: look up the Red River Gorge, Horseshoe Canyon Ranch, or Spearfish Canyon).
Speaking of the Red River Gorge, it's a major shame that there isn't more tech work in central Kentucky than there is today, as that would certainly incentivize some of us to want to live there again.
Which is the more likely way to end up owning a house in the Bay Area?
1) Work in Silicon Valley. You earn 30% more but pay 200% more in rent. It takes you 10 years to save a $200k down payment, and in the meantime you have lost 100s of 1000s of dollars on rent.
2) Work in the Midwest. You earn less but pay a third for rent. It takes you 5 years to save a $200k down payment. You then lateral to SV.
Ok, I'm biasing the question. But personally I'd prefer to delay gratification rather than delay homeownership.
I'm saving much more month to month after moving out to SV than I was making in the Midwest, even though my rent doubled. My compensation is >2x what it was, and all my other expenses outside of rent stayed around the same (my auto insurance actually got cut in half). Granted I did get a job at Google, so the comp is very good.
If you're living in Silicon Valley and only making 30% more you're doing it wrong. I'd guess you can make more than 100% more in SV if you're very talented. There's always the regression of the mean if you take everyone. But if you're a rock star, SV is the place to be, otherwise you're leaving a ton of money on the table.
That is not what I have been seeing. My absolute living expenses would go up about as much as my absolute after-tax income, based on what I could actually get out there (i.e. not a plum Google senior engineering unicorn job).
If you want to own a house in the Bay Area, the best time to buy is during one of the periodic recessions; but it'll be harder to get a relocation package to move to the Bay Area during a recession.
With lower house prices, you also need a lower percentage down. My credit union says you can do 3% down on up to $625k of loan. 3% down may not be the best idea, but waiting until you have 20% down can be a lot of waiting if you'd like to buy a house here. Putting a small amount down, means you do have to pay mortgage insurance (which wasn't very expensive in 2009 when I put 10% down), but it gives you a lot of flexibility.
If the recession deepens, and you lose your job and the housing market tanks, you can stop paying your mortgage, foreclosure is slower than eviction for not paying rent, and most California foreclosures are nonjudicial where the lender can take the house, but has no claim against any of your other assets. If you resume employment during the foreclosure process, you may be able to cure the default.
If you stay employed, you will hopefully at least get cost of living raises, while everyone else's housing costs are going up, yours will be flat -- you can put some of the raises into paying down your mortgage to get a more comfortable equity situation (and get the mortgage insurance removed). When the economy starts to recover and bring housing prices with it, you'll get some equity that way too.
Ok, why do you want to buy a house? To settle down and start a family? Great. As dysfunctional as California schools are, take a look at the abject horror that Brownback has unleashed on the Kansas educational system. Or Walker on Wisconsin. Or Pence on Indiana.
Sure, but Virginia isn't really the midwest. Once you get closer to the coast you're also looking at areas like the Research Triangle. While wars have been fought over less, you can still get some damn good BBQ in North Carolina.
And, yeah, as much trouble as I have with NC politics, I would take North Carolina in a heartbeat over pretty much anywhere in Kansas.
I find that Silicon Valley's proximity to mountains and bodies of water to be overly confining, and I place 90% of the blame for its housing prices on the Bay Area's geographical restraints. Great Plains cities don't have to worry about that because they can just sprawl outwards; geographically-restrained cities have to get expensive and/or get dense when there's a huge influx of population.
Let's pop onto Google Maps and check out some of these cities at the same zoom level (caveat: I'm using a maximized Chrome window at 1080p, so if you're on anything else it might not display the area I intend):
The Bay Area: https://www.google.com/maps/@37.6179156,-122.1933201,11z -- notice how almost everything is developed in this narrow little strip around the bay. Only in San Jose do you see any real development inland, and it's honestly not that much compared to cities in other parts of the country. Really, even if you could sprawl more inland without hitting mountains, you'd still have massive bottlenecks commuting to anything in SF because it's on a peninsula.
Kansas City: https://www.google.com/maps/@39.1155568,-94.7391727,11z -- it's spread out, and it's got more than enough room to grow outwards for quite a while. If it becomes a hub or something, it can just keep growing out to relieve the pressure.
The Twin Cities, mentioned as a former tech hub in another comment here: https://www.google.com/maps/@45.0593467,-93.2436588,11z -- big and sprawly, the exurbs are just waiting to be filled in, and there's still plenty of room to grow beyond that
Dallas, my own hometown: https://www.google.com/maps/@32.8116737,-96.9491413,11z -- I can elaborate more since I've lived here for over 30 years. I chose this zoom level because it's the widest one that would fit the whole Dallas area. Built smack in the middle of a prairie, I have seen the suburbs continuously sprawl north and east, plus I've seen the formerly-empty suburbs in between Dallas and Fort Worth fill up like crazy. You can tell the age of certain parts of town because our freeways are built in rings, like a tree. When I was a kid, the two northernmost freeways (President George Bush Turnpike and Sam Rayburn Tollway) didn't exist. Half of Plano was farmland, and the suburbs to the north, east, and west of it weren't considered part of the contiguous metroplex. Now, we've filled in the gaps between Plano and Lewisville, built up Frisco and Allen, brought the contiguous metroplex all the way up to Propser and Wylie, and now we're working on bringing Celina in. Mark my words: in the next five years, they'll start upgrading US 380 to freeway status. And within a decade, the contigious metroplex will reach to Gunter and Van Alstyne. And development to the east will bring Royse City and Forney in as well. House prices are spiking now due to a bunch of companies moving their headquarters to the Dallas area, and creating massive demand out of nowhere, but once construction companies start reacting to that demand, we're going to see a massive explosion in house-building in the exurbs, and house prices will fall back to their old levels once new development is complete. Oh, and the concentric circles model we're using for our roads makes commuting much easier than something like SF where the bay gets in the way of going from one place to another. You can easily reach downtown from the exurbs (and it doesn't matter anyway because most of our tech industry is in the inner-ring suburbs, not downtown).
So if I'm going to take geography into account when moving somewhere, I'm going to prioritize someplace built on a prairie, because that will give me low housing prices and low density.
I can mtb on dry dirt trail and snowshoe/ski, kayak in a lake, all in the same day here in the Front Range, and all of those activities are accessible from population areas within 15min-1hr drive
If you're a marathon runner, flat is not a bug, it's a feature. (Which is why running marathons in Chicago is kinda awesome.) And for me, fwiw, the miles of running path along the lakeshore are inspiring.
The east side of Kansas surrounding Kansas City is hardly flat. It's no Utah, but flat? Kansas City most certainly is not that.
The drive down to Witchita from Topeka certainly has its own class of wonderful views akin to what you would experience between Heber and Orem in Utah. These are just different scales of horizon, and both are enjoyable.
What would be really nice though, in the Kansas City area, if there was more light-pollution discipline to maybe bring back the experience of seeing the Milky Way again, without a long-ish drive.
it's all relative man... most of the mundane scenery out here in the MTN West would be packaged as a state park in the uninspiring parts of the country.
Sorry, I'm such as scenery snob now, after moving to the Mtn West from the Midwest...
FWIW I'm in KC tech sector. If I want to get back to nature I just drive 1/2 hour south to the land that I own, and I make more than those figures touted above. You guys can keep your California.
If outdoor sightseeing/activity is your mark for "interesting", the Twin Cities isn't it. But if "livable" is your mark, it's awesome. Easy to get around, reasonable housing prices, good schools, fantastic food and arts scenes...
Some of us are old enough to remember when the midwest (or more precisely, the Twin Cities area) was the nation's center for high-performance computing businesses. ERA, Univac, Honeywell, Control Data, Cray Research, ETA -- there was something in the water up there that laid a lot of groundwork for modern computing but is mostly now all forgotten.
The big problem many other places face (or face? I don't know the state of the art) is California has prohibited non-competes for decades: http://www.vox.com/2016/4/12/11349248/noncompetes-silicon-va.... If you want to be the next SV (or better), killing non-competes at the state level is a good place to start.
I'm no fan of non-competes but, as that article even notes, there are counterarguments that largely outlawing non-competes has been the secret sauce for Silicon Valley.
For example, there's the observation (see also Levy's Hackers) that a lot of computing industry action shifted from Route 128 to the West Coast. But consider the following:
* Many of those Route 128 companies were started by people jumping from other minicomputer companies. e.g. Data General was started by Edson deCastro who came from DEC.
* I'm not sure how common non-competes were at any of those companies. I certainly was never presented with one. It's true that people had longer careers with a given company but it wasn't necessarily because of non-competes.
* AFAIK, California law around non-competes existed long before the semiconductor boom effectively created Silicon Valley. (It's at least traced to 19th century California business code law.)
* The PC/industry-standard computer cycle was only somewhat related to the Bay area. Intel yes and HP to a lesser degree. But Compaq and Dell were in Texas. Microsoft was in Washington. IBM was in Boca and later Raleigh.
Again, I'm all for weakening non-competes. I could name a couple of companies that IMO use them egregiously. But I do think it's difficult to frame Silicon Valley success as a direct result of California law in that area.
ADDED: They were tapped to develop what was going to be to the System/360 what it was to prior systems, that got canceled for the obvious reasons, and various of those things ended up in what's now their IBM i (formerly best known as the AS/400), which under the hood is light-years beyond UNIX(TM) and its progeny.
Shoutout to the twin cities! As a developer here (without kids and living pretty cheap) I'm saving half of my income each month. I have a 1000sq ft apartment for 1k a month
I have to admit that St. Paul is on my short list for places to move in case I ever have to leave my home state (which might actually happen next year, thanks to Texas's transphobic state legislature). How's the food there?
>what would we find when we looked in ....Pittsburgh (home of the leading computer science school in the world, Carnegie Mellon)
Wait, it was 2012 and the venture capitalists were /just then/ figuring out it would be a good idea to be close to the "best computer science school in the world"?
Not that I had any respect for VC's before, but my opinion just dropped even more.
> ... entrepreneurs are building more billion-dollar companies in the Midwest than in the last 50 years combined.
Yes it's called currency devaluation combined with ZIRP.
I do wonder if they'll write such a flowery article when entrepreneurs discover that their odds of success actually go UP if they pass on VC altogether.
Columbus, OH is a big food test market. Why because it's got a large cross section of "middle america". If you can make something work here you can probably make it work anywhere. I think if more on demand companies were started here they could have adapted and/or blown up a lot faster. If you want a niche that caters to rich people go to NY and/or CA. If you want something the "average" american will buy try selling it here.
I definitely think there will be a gentle trend of tech moving away from Silicon Valley - perhaps not by people/organizations "leaving SV" - instead, people/organizations not "moving to SV". The center of mass will just disperse a bit even if the absolute numbers in SV remain more or less constant.
We've been building a 100% remote startup since late 2011 - it begun in the midwest (Missouri) and it has worked extremely well. We don't even have a location at this point and can't imagine a situation in which we'd elect to.
We started out similarly and the only reason not to is if your customers cluster geographically. It's a huge competitive disadvantage to not be where your customers are.
Could they add Arizona to the list of good places for tech business, please :-)
Life is inexpensive and good in Arizona and occasional flights to Silicon Valley are short and affordable. I spent my life in California until we moved to Arizona 18 years ago. Benefits of Arizona: very friendly people (try chatting with people in California when you are in a grocery store check out line, at the gas pumps, etc. - a culture of unfriendliness), low population density, very affordable housing, clean air and nice climate (at least where I am in the mountains), our state government is not as badly in debt as California, etc.
I have to disagree with your assessment of people in California. Having lived in the MidWest, New England, the South, and out West, I can say that the people in California (at least in Los Angeles where I am) are very friendly. I chat with them in the store and at the pump all the time. I can also say that it is the place where it matters the least what you look like when you talk to people you don't know. Skin color, clothing, etc. don't really seem to change people's attitudes too much here, whereas those other places all had very strict expectations of how people doing certain things should look.
I've also found that people here are far less afraid to try new and different combinations of just about anything - clothing, food, working with people from different disciplines. It's fascinating.
I'd bet that most of our impressions just come down to the luck of who we met when we lived in these different places. But my experiences definitely don't match yours. (My experiences in Arizona have been unmemorable. People seemed "normal" to me - neither rude nor overly friendly. I'll be going back next month, so we'll see if my impressions change one way or the other.)
I would have to strongly disagree that Arizona has "very friendly people". I find it to be the most openly hostile state in the nation, and they seem to pride themselves in that.
Arizona is pleasant in other ways but friendliness is not one of them.
Seconded. I am running the technology department of my (California) company from rural Eastern Arizona. Travel back to CA every couple months and it works out well.
I am a software developer outside Philadelphia. I love what I do but I've never considered Silicon Valley as a place I would want to live.
I know many talented software developers and know multiple VCs in the area. This is a hub for top-noch universities, a hub for every major pharmaceutical company, most major financial firms have a large presence here, including the largest mutual fund company. Plus, it is a short trip to New York (media/Wall Street), and DC (government and military), which brings lots of subcontracting projects.
In short, there is a ton of opportunity, talent, and money.
I'm outside Philly as well (western suburbs). There are plenty of opportunities. I wouldn't say the pay is as good as other places. When you factor in the cost of living, while certainly less than the bay area, it can be higher than midwest. Also, I've run into very few remote possibilities around here, maybe because it's mostly corporate gigs.
My startup is in Kansas City. There are a lot of great developers here. Huge companies like Garmin, Cerner, Sprint and others do a good job of attracting a lot of talent from all over the US here out of college. Startups like mine can then hire them when they are ready for something new.
Cost of living here is low. Decent basic house is $150-200k in the burbs.
Awesome office space is cheap. Great tax incentives from KS and MO to start companies and create jobs.
I honestly would have no interest being in the valley trying to compete with the likes of Google, Facebook and others for top talent. In KC we can be the cool company everyone wants to work for!
I'm in OP. Shhh... Don't let them know median household income in Leawood, KS is higher than Palo Alto, CA. Those SV people can stay in their rat race.
Mostly dual income households (with kids) with white collar jobs (accounting, engineering, etc). Not difficult to have that income. I'm in the 66211 zip code, but not in Leawood. Wife and I are both engineers. My base income alone is more than that household. Household income is double that.
The real kicker is ratio of home prices to household income. Schools are good here (no they don't teach creationism), low crime; You have to be nuts to live in SV.
Though even the individual income is higher, so case of high $ SV single brogrammer vs dual income family does not hold.
Interestingly, 66211 is very high with $443k AGI and $177k wage. The $443k AGI must be the the retired execs.
I don't know. I live in Chicago, and while I do get recruiters representing Chicago firms pinging me on LinkedIn from time to time, the majority still seem to come from elsewhere. I also had a tough time finding my next job after I was laid off here, twice in the past three years.
I still love the area so I'm still sticking around for a bit longer, but I don't really see what this guy's seeing.
My impression is that Chicago has a lot of catching up to do in terms of recruitment. The jobs are there, but a lot of places are clueless about advertising them and courting talent. Housing prices are more affordable than the valley, but still high for the median salary here. Really the biggest problem with Chicago IMHO is the aging demographic of the highly skilled sought after developer means they want things like good schools and safe neighborhoods IN their city not an hour outside of it.
The midwest is not the future of startups and will not overtake Silicon Valley in the next 15 years. Yes you can find talent in the midwest but do you think top CS grads from CMU, UIUC, Purdue, etc. want to stay in the midwest after graduating? Think about it.. 22 years old, fresh out of college, after living in the midwest for 4 years...most of them want to come to San Francisco / Silicon Valley, the tech center of the world. Also home of all the other famous tech companies they heard of / interned for before.
Nitpicks from the article:
"California is the eighth largest economy in the world. The Midwest is the fifth"
really? source on that? What states exactly does that entail?
"The Midwest receives 25 percent of all research dollars in America and graduates more computer science degrees than any other region or country on planet earth."
source?
"home of the leading computer science school in the world, Carnegie Mellon"
Not one of the leading, but THE leading CS school. Even better than MIT? Better than Berkeley? Better than Caltech? I'm not saying any one of those is THE best, but I would argue they are all top-notch.
I'm a developer. I recently moved to Ann Arbor. I've worked for startups my entire career, only the most recent of which even has an office in SF. Our office there is small, and contains only a small fraction of our sales staff and the people that need to interact with VCs.
I would need to make upwards of $400-500k / year in SF to get the quality of life I get here. Here, there are good school districts, affordable real estate, affordable child care, and low crime rates. No subset of the city perpetually smells like human excrement and trash. I bought a house less than a mile from downtown, and not only can I afford the mortgage, I put 20% down and I can continue to save aggressively. We have a yard substantially larger than a postage stamp. There's a large public park a quarter mile down the street, and a smaller one at the end of my block. My wife can walk to work in ten minutes.
SF is a bustling center of activity in my industry, but it's also a money pit. It's not worth it for me to locate myself there.
All your points are good. As someone who suffered a 6X cost of living increase (but only a 1.5X salary increase) when moving from Flyover, USA to Silicon Valley, I'd love to go back. I hate my 2+ hour (each way) commute. I hate that I can no longer save. I can't stand living in a small space on a tiny lot and paying enormously for it. But you know what I hate more? The feeling that when I need to find my next job, I will have only a handful of local employers to choose from or will have to move to another state to find employment. You always have that hanging over you when you're living in a non tech hub. Here, things suck but at least if you have 10 days you can interview at 10 tech companies all in the same area. That's priceless.
I'm really surprised by all of the next job worry. I'm a software developer in Iowa and have been doing this right here for 18 years now and that has never been a concern. I was once out of work for about 2 months after being laid off from a start-up after the main VC investor backed out.
I have spent a lot of time interviewing candidates and it is much harder for me to hire than it is for me to go find a job.
I have a nice large home in a quiet neighborhood with easy access to anywhere I want to go. I raise three kids and still manage to invest about 50K a year into retirement every year and so I will retire early with millions saved.
There is so much FUD from everyone that doesn't live here.
Please keep thinking the same way though. If everyone catches on and moves here eventually we really will be the next silicon valley; to that I say, "No thanks."
I live in Chicago and it can be a bit tough finding the next gig here. Lots of people are hiring, but no one ever seems to be in a big hurry. I had one recruiter touching base with me for over two months as one startup took their time to schedule a second phone interview with me (I was still in contention, they just have a dirt slow process. The recruiter had complained to them about it before).
By the time they were ready, I had finally found something new, but that was after four months (they contacted me when I was 2 months unemployed). I've also had people submit changes in their requirements to recruiters before a phone interview so I was no longer had enough years of experience for them (and I have quite a few), contact me about setting up an interview and then never end up emailing me to confirm a final time, all sorts of stupid stuff that's happened.
I'm at a new company now (in the Chicago area) and even though we've lost four people and we're 'desperate for new developers' according to the boss, we haven't had a new hire in at least six months.
I doubt this kind of crap happens with companies at SV, because they wouldn't be able to hire anyone because other companies would snatch them up too quick.
> I doubt this kind of crap happens with companies at SV, because they wouldn't be able to hire anyone because other companies would snatch them up too quick.
No, I can assure you that it does happen in SV too. Everyone claims to be 'desperate for new developers' but the proof is in the pudding--lots of places interviewing, few places hiring. Lots of slowness, endless rounds of interviews, and foot dragging.
It may be priceless to you, but my utility from marginally increased income stability does not asymptotically approach infinity at "an interview per day".
> Yes you can find talent in the midwest but do you think top CS grads from CMU, UIUC, Purdue, etc. want to stay in the midwest after graduating? Think about it.. 22 years old, fresh out of college, after living in the midwest for 4 years...most of them want to come to San Francisco / Silicon Valley, the tech center of the world.
Other people have commented on other things, but this statement seems out-of-touch. You realize that large numbers of students at those universities come from Midwestern states, right? That the singular obsession with Silicon Valley is restricted to a very vocal and enthusiastic minority?
Yeah, I both went to UIUC and did job fairs/interviews there later, and while there certainly is the "let's get out of here" mindset from some students, many students' first question was "what do you have in Chicagoland?" or occasionally the Twin Cities. This was, perhaps obviously, especially true of the students from those cities. Hearing that a coastal job was the only option was definitely not a plus to many. Things were somewhat different for grad students who tend to be more diverse geographically, but it's not like they're taking HS kids from SV, dropping them in the Midwest to get educated and then releasing them from their hell after 4 years.
Unrelated note, how did PA (CMU) get included in the Midwest. Philly is essentially on the Atlantic Ocean and the Navy used to build warships there. That's hardly any sort of degree of West.
>do you think top CS grads from CMU, UIUC, Purdue, etc. want to stay in the midwest after graduating?
Without some real surveys it's hard to make conclusive statements, but these are the top reasons I hear for why people don't leave Minneapolis for the coasts:
* Housing (and cost of living in general)
* Family and social network
* The Bubble (SF in particular).
* They just love the city and don't feel the need to move.
I don't have source for you other than I went to Purdue, but I believe the 25% number for research dollars. You have Purdue, Indiana, Ohio State, Michigan, and many other research universities in the Midwest. Did you know that because both Purdue and Indiana are such powerhouses for biotech research that Indiana is one of the best places in the US to start a biotech company? As for a source, I did biotech research during my graduate studies at Purdue.
Honestly I am glad to hear a VC finally say that Silicon Valley isn't necessarily the best place to start a tech company. The reality is it depends. Maybe SV is the best place and maybe it isn't.
I think the germ of truth was in the article - you need to be close to your customers. If your customers are tech firms, or the kind of people who work at tech firms, Silicon Valley is a good place to be. If your customers are biotech or banks or any of 100 other disciplines, you're better off being elsewhere.
>really? source on that? What states exactly does that entail?
Is that really that surprising? The Census Bureau defines the midwest to be 12 states: Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, and Wisconsin. Their accumulated GDP is 3.6 trillion vs California's 2.4 trillion or approximately 50% more(numbers found on wolfram alpha). But then that is 12 against one, not exactly exciting that the Midwest isn't a third world country.
Not sure how CMU and Pittsburgh ended up there though that is Midatlantic not Midwest. Probably just makes the math more favorable.
"Next Silicon Valley" articles are speculative hype. That said, SV's housing crisis, crumbling infrastructure, and sheer inequality seems pretty unsustainable. Let's hope that the other 90% [1] get a bigger piece of the pie soon, for the sake of developers not being obligated to work here.
Better than CalTech, most certainly (the school is just too small, and too science focused I would guess). But it's indeed iffy to argue that any one of Stanford, UC Berkeley, CMU or MIT are the best, it really depends on what you're looking for. E.g. if you want a lot of EE with your CS, go to Berkeley or MIT. Pure CS? CMU would seem to have a strong case (certainly much more than MIT), its competitor would be Stanford. Also a very selective program, you have to apply separately to it, and they only accept 135 students per year. By comparison, MIT and I would guess UC Berkeley's enrollment are a lot larger.
To throw out some more numbers, the last I got for MIT, which was before a degree from it was perceived as being relatively more valuable in the Great Recession, it received 13,000 applications, 3,000 of which were judged capable of doing the work, and the admissions office aimed for a yield AKA class size of 1,100.
If these really are top grads, they should be able to do math. And if they do the math, they will find that the cost of living and tax situation is such that they will net less money living in California than they would in, say, Austin Texas.
I did the math. I got offers from some prominent bay area startups. They are constantly recruiting me, but none of them can offer a competitive deal on salary (and don't get me started on their "stock options" packages.)
You seem to be projecting your aspirations/desires or preferences and assuming that is the case for everyone else. I do understand that for your first job working for someone like Amazon seems glamorous, but once you've put in a couple years there (and Amazon is a particularly abusive hellhole for engineers) that wears off.
The top talent is not swayed by "name brands" but by places where they can really be innovative.
I can imagine the top MBAs from Midwest universities DO want to go work for these "name brands" because it pads you their resumes nicely.
But hackers? Hackers want to hack. They want to be on the cutting edge.
And that's no longer silicon valley. Hasn't been for awhile. It's just nobody told the people who live in silicon valley, apparently.
It's so obvious that whoever wrote this is not from the Midwest. If you are going to call CMU as in the Midwest, you might as well say Seattle and Phoenix are suburbs of Silicon Valley.
I don't think where developers go to school have all that much to do with it... The best developers I know don't even have college degrees. They were self taught and it is just in their blood.
Silicon Valley is, and will continue to be, to tech, what New York is to finance. Which means all these other startups will be like regional banks. Good businesses, yes, but not a 'threat' to the big Silicon Valley companies and the tech ecosystem there.
For certain values of tech perhaps. Silicon Valley already isn't and never has been a particular center for biotech/pharma for example. One of the things that I expect we're seeing (in addition to the fact that it doesn't work economically for everyone to be in California) is that, as technology of various sorts becomes central to more and more different industries, the centralization of "tech" increasingly makes even less sense than it does already.
I do agree it's not so much as a "threat" to Silicon Valley as just a greater distribution of technology centers to other regions.
> Silicon Valley is, and will continue to be, to tech, what New York is to finance. Which means all these other startups will be like regional banks.
Wells Fargo and Bank of America defy your assertion here. In fact, five of the ten largest banks in the US are not in New York. Also, I don't know what you consider "regional", but of the 30 or so US banks that have over $100B in assets, only 8 are in New York City.
This isn't quite true. Yes, the BofA head office is in Charlotte. I used to work there. All the interesting work happened at BofA NYC, regardless of its smaller size. The same was true with Wells Fargo. In fact even BofA SF in the financial district does a lot more interesting math especially in hedging and risk, compared to Charlotte.
So don't be fooled by the physical location of the bank's head office - most of the interesting work happens in the bank's NYC branch, which is where the talent is.
New York isn't the New York of finance anymore. Firms are scrambling to get their presence all over the world because the opportunities are no longer converging on Wall Street as they once did.
Do you have any articles or anything covering this? Would love to send it to my friend who just lost their finance job in NYC and now thinks they've been blacklisted...
Whether or not that's true, I want to convince them that there's nothing wrong with leaving NYC at this point if they can't find a job.
At this point in time the advantage of SV is not for the "angel" sized company, but for scale-up from the $1M to $1B range. (i.e. Y Combinator would not have a huge advantage in being there except for the fact that the next round of funding is available there)
Any reason why midwest and not southeast? The outskirts of Raleigh and Atlanta have the same cost of living benefits while having access to a large talent pool and being close to the coast line/major cities.
I've worked both coasts equally in my career and have found that despite cost of living differences, wages for the top 25 percentile are quite compressed compared to SV or NYC. Furthermore, there is a rash of jobs that are primarily cost-cutting measures from companies based out of more expensive areas, which puts you at a kind of career positioning disadvantage. Case in point, when I was at HP in the Seattle area we had an office in Cary - it was primarily for QA, not for our platform developers that were more important to continued success of the product. I'm finding the same trend in Atlanta and even fintech jobs seem to regularly pay under $100k for senior developers here when the cost of living has gone up dramatically compared to my perception that I could get a decent place for <$1500 / month where I wouldn't have to suffer from a horrible commute - this is patently untrue I've found after spending a month searching for housing (not apartments, admittedly).
>Furthermore, there is a rash of jobs that are primarily cost-cutting measures from companies based out of more expensive areas, which puts you at a kind of career positioning disadvantage
Does/will the midwest not have this problem though?
>jobs seem to regularly pay under $100k for senior developers here when the cost of living has gone up dramatically compared to my perception that I could get a decent place for <$1500 / month where I wouldn't have to suffer from a horrible commute - this is patently untrue I've found after spending a month searching for housing (not apartments, admittedly).
You can rent a family home on the north perimeter for around $1700 a month. Not nearly as cheap as some midwest locations but not nearly as expensive as the Bay Area. You also do have the option of having a 40 minute commute and paying a fraction of that in rent. It's a nice option to have on the table especially if your job is located outside the city or allows remote days which is often the case.
With my experiences with the F500s cutting IT costs, most onshore outsourcing was going directly to Texas and the Southeast for what appeared to be specific state-driven tax advantages - only with one or two sites did I see going somewhere like IN, OK, or KS usually due to existing assets there. Based upon more anecdotal info based upon Indeed results, in proportion to the population, there are potentially more and better software jobs as well as greater legacy of older-generation tech companies mentioned elsewhere in the thread from, say, Indiana and Ohio (Xerox). There's also healthcare companies in the midwest like CERNer that would result in some more (admittedly, IT primarily rather than software) tech jobs. Furthermore, Walmart seems to have a pretty solid number of technology jobs that aren't network and storage janitor work.
I never managed to find a house that was 3br/2ba+ in Brookhaven on up past the perimeter < $2000. It's a bit of a sticker shock for me in rent when the place I bought last year was about $1k / mo mortgage and comparably nice besides a bathroom's upgrades.
I was also raised in Pittsburgh. Having lived in Ohio and Michigan later in life with vacations to the coastal cities on the east, Pittsburgh feels much more midwestern than east coast to me.
Boston, Philadelphia, NY, or NJ, the actual near-coastal cities, felt as "foreign" as when I moved to CA. (not sure if foreign is a good word, I don't mean it to be negative as I loved my move to CA)
I'm sure you are technically correct based on some google map searches, but I had never thought of Pittsburgh as east coast growing up or visiting later in life for Steeler games
Same here, but I never really knew what region to give us. Too East Coast to be Midwest, too Appalachian to be East Coast, too Midwest to be Appalachian.
I always just think of us as being a bit region-less, which I think suits the city and its people just fine.
So do you feel Pittsburgh is more similar to New York than Chicago? I've always felt that PGH seemed more culturally similar to the great lakes cities (it is traditionally part of the Great Lakes Megalopolis[1]) than to the east coast corridor, but I'm a native of none of those places.
Someone who has lived in Cleveland, Pittsburgh, now Chicago here. I think Pittsburgh is much more similar culturally to Chicago than NYC. When I saw the post lump Pittsburgh in the Midwest, I had a feeling the "But wait, Pittsburgh is in Appalachia" comment was coming, but I think it made sense to put in in.
"Midwest" can mean anything from Pennsylvania to Kansas. It can mean the Old Northwest (the original "the West") [0], or it can mean "just west of the Mississippi River". As Humpty-Dumpty says, it's just a question of who is to be master.
Pennsylvania is a Mid-Atlantic state, but Pittsburgh is where the Ohio River starts.
As an Oregonian, I always scratched my head when seeing that "Northwestern University" was in Illinois until I realized that at one point, that was the "north west".
Pittsburgh is somehow less East Coast than is Philadelphia. Philly is an original-13-colonies port town; Pittsburg was (for them ) way west .
Historically (IMO) , "Midwestern" in the US refers to when a city was settled - if it was ostensibly a then-Western fort settlement, it'll be closer to being Midwestern. So it has at least something more in common with say, Cincinnati than with Philly.
Likewise, Roanoake, Va is pretty midwestern while Norfolk is very East Coast.
I think the areas between the Mississippi River and Appalachian system are a bit nebulous as to where they fit in. The Rust Belt has generally been considered Midwestern, but not Kentucky (even though settlement of both regions happened at roughly the same time. Tennessee and Arkansas generally get lumped in with the South. Moving west, Oklahoma is another toss-up, and Texas is plopped across three regional boundaries (South, Midwest, and Southwest).
Not just the Appalachians; any natural barrier between the coast/Piedmont and the place under test will work. But IMO, it's mostly about the settlement pattern in play.
I've found Colin Woodard's "American Nations" to be a pretty good guide. I think this map comes from that:
Pittsburgh is in the Rust Belt, which often gets lumped in with the midwest. It has more in common with Buffalo and Cleveland, or even Milwaukee, than NYC or Chicago, although Pittsburgh is economically stronger than most of its Rust Belt brethren. No one from the East Coast considers Pittsburgh part of the coast - Philadelphia is the East Coast city in PA. East Coasters see Pittsburgh as Cleveland in the universe where Spock has a beard. [I really like Pittsburgh and other Rust Belt cities]
^ Not sure why this got downvoted. I'm pretty sure that if you told someone who lived in a rural area that they lived "out in the boonies" or that they were "rednecks," they would also take offense.
Please take some perspective: People on here are literally calling my beloved hometown and place of birth a "Rust Belt."
Even though I'm in Silicon Valley now, the vast majority of my friends and family still live back home.
That's like saying they tried building internet businesses in the late '90s and it didn't work out. Strategies can become more feasible as circumstances change.
I'd amend that to "...important hubs for what is left of telecom." It's just the Schumpeter cycle at work.
The amount of money dumped on the area, SarbOx regulation changes, even Enron[1], and the overt abuse of the H1B visa left it crippled relative to what it once was compared to the span of say, 1985 to 2005.
[1] these things came up in funding meetings at various times in the area. "you do know that Enron is Houston, right?" "It's still Texas."
I work at Masergy. We're a mid-size (~500 employees) telecom based in Plano, TX. We are doing very, very well. I don't think I'm allowed to share numbers, but this is the first company I've worked at where I don't have to worry about whether or not the company will be out of money by the end of the year. I remember my first employer, a small UC security company that eventually got bought by Avaya in a rather successful exit; every year, we played the game of "will the VCs go for another round of funding or leave us to die?". I don't have to worry about that here.
We've also won a lot of awards lately, including placing on the list of 5000 fastest-growing companies.
But maybe we have different definitions of telecoms. I think, in the present day, any company that does UC and/or cloud networking (we do both) should count as part of "the telecom industry", because they fill the same niche as the traditional telecoms. We've also got IBM SoftLayer and FireHost/Armor here too, plus Amazon has recently opened some offices in Dallas (a good friend of mine interviewed with them for an AWS support job here; didn't get it though).
Thanks much for the update. I extremely am glad to hear things are going well. It got really dicey there from around 2002 onward. But from 1985 ( or before, really ) to then, Dallas was poppin'.
We almost have to have different versions of what is meant by "telecoms" because it's all changed radically.
The optical business is pretty bleak. It's the last vestige of the more old-school telecoms left. You also see Cisco pivoting these days.
Where wasn't it dicey in telecom in 2002 onward? It's been noted the dot.com bust was more of a telecom bust than anything else.
I had the ... special privilege of going to work for Lucent in January when they had 106,000 employees (and an Oracle licence for that many seats). When I left in December they were on their way to a planned 35,000, and were eventually bought by Alcatel. It could have been worse, look at Nortel....
Oops, that was "January 2001" when I started at Lucent, by 2002 they were clearly doomed, e.g. the last project I worked on, a media gateway (https://en.wikipedia.org/wiki/Media_gateway to pair with their then very successful SoftSwitch), was deemed utterly essential for Lucent's future (I read the marketing research documents, which said there was no future for integrated switching systems like the storied 5ESS, who's people worked on this project), and the project was clearly doomed.
E.g. not only was first it absolutely minimally resourced, it was then not spared company wide layoffs, and they made a point of boasting about laying off one of the most visible and productive members of the team, undoubtedly to show us no one was deemed essential, and also undoubtedly because he was pointing out problems. The project was canceled not all that long after I left, "and the rest is history".
Is this principally in the web space? That would be why I don't see it then. BuiltInAustin has ... probably a couple-three hundred positions open, no more than 100 per job description.
"Why weren’t top-tier VC firms spending time in Ann Arbor, Indianapolis, Minneapolis, Columbus, Chicago, Detroit, Kansas City, Pittsburgh, and St. Louis?"
Because you want to sleep close to your money.
"The answer, we concluded, had everything to do with timing. In the first few decades of the Internet, you had to be physically close to your technology. That technology, the talent that built it, and the ecosystem that maintained it was in Silicon Valley."
C'mon. You didn't need to be close to your technology. PCs and servers and backbones can be installed anywhere.
You wanted to sleep close to your money. But now you're willing to loosen the leash a little if it gives you more bang for the buck.
On the flip side, in the Internet's nascent days, you HAD to get an in person meeting with the VC before convincing them to part with a 5 or 6 digit sum of money. Skype was not really possible on a 56k modem.
Well of course you had to meet in person to get business done.
What's happening is that the word is getting out to the engineers: SV is too expensive a place to be, even at GoogleMicroUberAmazon pay rates. The gold rush is over.
> SV is too expensive a place to be, even at GoogleMicroUberAmazon pay rates.
Sample size of one, but this is true for me. I'd really like to come back to CA, but I make 6 figures already, and a 3600 sq ft house is only like $400k here. I don't see what SV has to offer except a larger market for opportunities, but I'm in my mid-30's, so I'm worried that I'm not really a target demographic for SV employers.
Pretty sure at Uber and Google pay rates (esp. Uber, but also Facebook), SV is what I'd describe as affordable.
Microsoft and Amazon, not so much, to say nothing of the majority of other tech companies that aren't well known as the top paying three companies out here.
It boggles me why California doesn't push for tech development in the cheaper parts of the state. Plenty of places in NorCal could siphon off the Amazon and Microsoft pool as well as attract other outside talent.
It turns out that living in SF or Palo Alto is a big part of their recruiting pitch, believe it or not. The social signaling of saying you work in SoMa means so much in materialistic Bay Area social life.
"Did you know it was possible to outfit an open-plan office with Ikea desks -- in the midwest? TIL."
This reads like a parody until it inexplicably turns out not to be.
Columbus and Ann Arbor both have big, important universities smack in the middle of town, and the demographics and culture that go with that. If you were choosing the least-surprising towns outside of the Bay Area and NYC to find software startups in, those would pretty much have to be on your list.
Having recently abandoned the Columbus area, I can safely say the Midwest has a long way to go in the culture department. Even relatively new startups in that area tend to adopt the conservative workplace culture that the old guard is still addicted to.
Honestly, that sounds like a good thing to me. I find SV startup culture to be degenerate, but it does sound nice to have a large amount of job opportunity in tech industries around.
Putting a large tech investment in a region that values conservative workplace culture honestly sounds perfect to me. I like my cube farm :)
It is a double edged sword. Sure there are companies that abuse say...unlimited vacation (not all do),but I could never go back to the standard two weeks that most Midwest companies do. There's also worse treatment in many ways for employees since there simply aren't as many good job options, or options period in some cases. Companies take advantage of this accordingly.
This topic has been coming up on this site for the past decade. Every time it does there are a lot of people who say Silicon Valley will never be beaten. I call this way of thinking "California exceptionalism".
Put another way:
"Nobody will ever need more than 640k."
Since the days of Fairchild, the bay area has had an advantage in finance, and of course VCs who didn't want to invest in anyone more than a bike ride away. The level of attitude is really kinda astounding.
California was the golden state... but that was 50 years ago when it had a pro-business government and was disrupting the US industrial base, and attracting high tech talent and companies in the process. Now it is eating itself, drowning in debt and getting ever more desperate due to decades of bad government.
In our industry things have changed. The need for VCs is dramatically less. You don't need to build servers and software from scratch, you can rent servers in the cloud and build on open source foundations.
There are always going to be more smart people outside of SV than there are in it. And TBH, I don't think the SV startups have been really innovative for the past couple decades. It's like after the dotcom boom everything became an "app" (instead of a "dot com" eg website).
For example you aren't building Intels and Apples anymore. you're building Googles (Which might become an Apple, if one of its moonshots turns into a product, but it isn't yet, it hasn't weaned itself from search and search's days are numbered.) You're building facebooks and ubers and airbnbs. It may not look like if if you've not been thru a couple bubbles but those companies are more flash in the pan than solid. Facebook could be more properly called a fad.
The difference is they aren't really technology companies. Google invented page rank, but almost nothing fundamental since. Facebook hasn't invented anything really. It's just a popular content site. Uber and AirBnB are business models, not technology inventions. Of course they all require and depend on technology investment, but they are not based on technological innovations like Intel and Apple are. (And don't even get me started on Amazon which is really a combo of Walmart and U-haul-for-computers. They actively oppose innovation.)
And for some high tech industries, Silicon Valley is not the center. The disdain upon which californians look at bitcoin is a good example. It's kinda a "not invented here" syndrome.
It's like we're the internet, you're AOL at its peak. You rule the roost right now, but you don't get it.
> This topic has been coming up on this site for the past decade. Every time it does there are a lot of people who say Silicon Valley will never be beaten.
Perhaps, but another topic that has been coming up on this site for the past decade is, "X is the new Silicon Valley!", and every time it does there are a lot of people who say Silicon Valley is about to be beaten... and it hasn't happened yet. That's not to say it won't ever, but the track record of these predictions since, oh, the mid-1980's is dismal, and I would say they have a heavy burden of proof to show they're not talking out of their asses.
It has happened yet. You know what William Gibson says- the future is already here, it's just not evenly distributed yet.
There are several X that are the new "silicon valley". you just don't recognize them because your pattern recognition is tuned for the current silicon valley.
Several of those predictions, by the way, have come true. Of course if you define "silicon valley" narrow enough you'll never see it. And it seems to me the people in SV do so. (You can always come up with a difference between SV and what ever place and say "see that doesn't qualify")
Also, the attitude and smugness of silicon valley is grating, and its' getting worse as your decline deepens.
This article is hilarious. "Did you know that there are smart people in this place called the Midwest that can also code and find product / market fit? Who knew!?"
The tone, though positive, is quite patronizing to midwestern ears. If you're not investing here, you're missing a huge opportunity.
I can't see any clear revenue path or exit for any tech investment out there, you couldn't even invest in a weed business out there like in Canada or the coasts of the US
> Everywhere we looked, the data supported our conclusion that today entrepreneurs are building more billion-dollar companies in the Midwest than in the last 50 years combined.
> California is the eighth largest economy in the world. The Midwest is the fifth.
What metric is that? On what scale is "The Midwest" an economic union?
I read the article now and I won't dismiss the notion, but that still doesn't answer where they are going to get their exits from, and what the bounds of the midwest economic region actually are, to former Sequoia partners.
You keep mentioning exits - are you talking about being close to a network of partners that will BUY your portfolio companies, or being close to companies that can exit / go public / etc? A large number of exits have occurred in the Midwest over the past few years. Payments, Enterprise Software, Aerospace, finance, etc. What concern is there about a shortage of exits or exit source? It sounds like I'm missing a very valid concern.
Note: I also disagree with people lumping the entire Midwest together as a thing. Chicago != Milwaukee != Cleveland != Minneapolis != Detroit, but neither does SF = LA, so not sure how best to aggregate.
I don't know, I'm a programmer in the Midwest and not a investor. But judging by Sequoia's track record, if they think my area is a good place to start investing, I'm gonna accept their notions as pretty accurate over mine.
We changed the baity title, happily in time to preempt the unproductive argument it probably would have led to. If someone can suggest a better (more accurate and neutral) title, we can change it again.
You did fine, though you could also have changed it, since the guidelines say "Please use the original title, unless it is misleading or linkbait." When we change titles for that reason we always try to use a representative phrase from the article itself (e.g. a subtitle or leading sentence) but I had trouble finding one here.
This comment was snarky, ranty, and therefore a bad HN comment to begin with. But when you got to this:
> And I don't think I even need to comment about the cities that have to deal with the political problems of being in a red state. Sure, if you're white, heterosexual, christian, and have a wife mostly interested in spawning burb-rats, the midwest is awesome.
... you crossed into bannable offense. This sort of slur isn't allowed on HN, regardless of how you feel about the group you're slurring, and regardless of which group it is. Please don't post like this to HN again.
(Incidentally, people sometimes feel like it's ok to dump on a group they themselves come from or used to be part of. That might in part be true in in-person conversation, where it's possible to detect nuance. But it's definitely not true here, where it's not.)
Without addressing any of your other points (being outside the US, I have no knowledge in this area), it's interesting to note that at least one of the co-founders of ModCloth has a number of regrets about the opening of the SV office, and considers that staying in Pittsburgh may have been the better option:
I'm from Pittsburgh and I think it's a really nice city. But I doubt I will move back, the weather sucks. And, less of a concern, but PA is generally an unlovely part of the country in my opinion. I could barely believe my eyes when I saw Oregon and northern CA.
> And, less of a concern, but PA is generally an unlovely part of the country in my opinion. I could barely believe my eyes when I saw Oregon and northern CA.
I'll disagree with you there. I think Western PA is quite beautiful in the late spring, summer and early autumn. My reaction to Northern Ireland was "It's pretty, but going up US-22 through the Applachian Plateau is prettier--especially around Cresson."
You know, some of us like weather that changes a lot more, also killing frosts/freezes kill a lot of nasty bugs (although I'm not aware of the Bay Area being know for that sort of problem, maybe too dry?). A quick check indicates you can go decades without a white Christmas, and Wikipedia says about San Jose that "On average, there are 2.7 nights annually where the temperature lowers to or below the freezing mark".
Then again, I was also retired to my home town of Joplin when the 2011 tornado hit (http://www.ancell-ent.com/1715_Rex_Ave_127B_Joplin/images/), but one convenient thing about tornadoes is that you only have to walk a few blocks perpendicular to their line of movement to get to undisturbed buildings and such, the aftermath is therefore a lot easier than wide area disasters like earthquakes and hurricanes.
Many people like that, but just as many if not more don't.
Slipping on the icy stairs in Chicago where I grew up and lived most of my life, before walking to the train and having my glasses frost over from my breath did it for me. Then there are the insane humid summers.
Being able to go outside practically whenever I want and not feeling guilty if I stay indoors was worth moving to the Bay for me. We also have gorgeous long falls here where the leaves change color and everything.
Don't underestimate how many people loathe crappy weather.
I don't disagree, hence my use of the word "some", and I think Chicago's combination of very cold winters plus humid summers would not be to my taste. Experience shows I can tolerate one or the other based on living in the Boston area for a dozen years, and the rest in the Joplin and D.C. areas which are pretty similar, on the order of 15 degrees F higher in the day during the winter than Chicago.
I love watching the change of seasons. When I had to move to the west coast I was really upset about losing that. Trying to move to NY again to get it back
Seriously though, I moved to Seattle from the Southeast, and I actually love the predictability aspect of the weather here. I rotate between the same hoodies for 9 months of the year and never have to check the temperature before heading outside, it's always 50-60ish if it's not summer. So while technically it "changes", it doesn't compare to the rest of country which can have some truly nasty extremes I've never seen here.
I read somewhere that the one thing all the startup hubs had in common was that they were a desirable place to live. This does not seem to describe just about anywhere in the mid-west with its bad climate and shrinking cities.
Maybe that info is stale? Climate isn't perfect but cities are not shrinking. There are 200M more Americans these days; they don't all live on the coast. Many midwest cities are growing. Slowly with reasonable housing costs.
Given a choice for investing in a new firm that is a 15 minute drive from the VC's office, and with tons of existing talent to recruit into the company, and with lots of other VC's in the area to fund future rounds VS a startup that might get a better bang for the buck on pricing because it's in the boondocks, and I don't think MORE startups will appear in the midwest than SV.
California, and therefore "Silicon Valley", still enjoys the unique advantage of non-competes being unenforceable, creating a particularly liquid market in talent.
It's probably an advantage for California but it's far from clear how major a factor it is in why Silicon Valley developed the way it did. My understanding is that the law that's the basis for non-competes not being generally enforceable has been in place for a very long time (1800s). Yet, Silicon Valley was fruit orchards while other areas of the country were the centers for developing computers and creating much of the technology behind the early Internet.
Indeed, and my question, having lived the tail end of Route 128's boom years and then its hard and final death, is why those other places got eclipsed by SV, with no clear sign that's going to change (modulo it looking to be harder and harder to make it work economically).
The only unique thing about SV is the unenforceability of non-competes, that was clearly absolutely critical in the original silicon days (https://en.wikipedia.org/wiki/Traitorous_eight) and probably sped things up by decades, I've also experienced two good pieced of technology killed by them outside of California, and I'm frankly left without a better explanation.
Just how important unenforcability of non-competes was for making SV into SV is debatable (eg, clearly did not differentiate from LA). More compelling reason for any state to make them unenforceable is that less enforcement has better outcomes (more startups, jobs, incomes, patents; well last is problematic but usually used as a proxy for innovation), _even when Northern California is excluded from the dataset_; see 10.1287/mnsc.1100.1280 or http://webdoc.sub.gwdg.de/ebook/serien/lm/DRUIDwp/10-02.pdf
I think that mentality may change as people start coming to the realization that it will soon no longer be necessary or even possible to "scale up quick and capture market share" based on a theory of disruption. The gold rush of the internet will soon come to a halt, especially as people start realizing that you no longer need to sell a pound of flesh and the rights to your first and second born child to VC in order to build great, quality companies.
Depending on who wins out this general election, we will possibly see a rather ironic shift that will not only undermine the hegemony of Silicon Valley, but will also make staffing startups with low cost talent from all over the globe far more feasible. I've been telling Silicon Valley for a while now, be careful what you wish for, because it's easy to lose sight of the real world from within a rose colored bubble.
I have a feeling that as/if globalism were to expand and consolidate power and control, it also broadens, dilutes, and devalues "labor" on a global scale as you start feeling the effects of globalism that clothing makers, furniture makers, auto makers, etc. have all felt before you. The only thing that is keeping the tech industry enslaved to Silicon Valley, is the dependence on their VC masters, as you so well described. Once that is no longer a benefit or necessary or an advantage, what keeps people in Silicon Valley?
