Tech companies say goodbye to Silicon Valley
Silicon Valley has been the epicenter of the tech industry for decades, beginning in 1938, when Bill Hewlett and David Packard started their garage business in Palo Alto. However, this trend could radically change. Hewlett Packard Enterprise is known to move its headquarters to Texas. On Friday, another longtime Silicon Valley resident (Oracle) announced plans to join HP by moving to Austin. Several other high-profile tech investors and executives are also leaving San Francisco.
Many people have worked from home this year due to coronavirus. Several tech companies have said they will provide employees with the ability to work constantly remotely even after the end of the pandemic.
Some of those who have already left San Francisco complained about poor city management and state administration.. Although it is not clear what exactly is meant. California has implemented restrictions related to Covid-19, which some market participants, especially Elon Musk, heavily criticized. In Florida and Texas have slightly less stringent restrictions.
Silicon Valley also has very high real estate prices. In addition, California has a very high personal income tax rate, while Florida and Texas do not..
Moving to Texas is hardly a surprise. Technology center nicknamed «silicon hills», is already home to industry leaders including AMD (Advanced Micro Devices) and Dell.
As of November, 39 companies from tech and other industries have moved to Austin. Among them is 8VC, a venture capital firm run by co-founder Palantir Joe Londonsdale (Joe Londonsdale). Tesla is also building a 4 million square foot facility near Austin that is expected to create 5,000 jobs for the state.
It’s not just the tech sector that attracts Texas. E-cigarette maker Juul Labs last year also moved its headquarters to Austin.
Laura Huffman (Laura Huffman), President and CEO of the Austin Chamber, cited the educational level of the region’s population as one of the reasons companies are looking to move here.. She noted that 47% of the city’s working population has a bachelor’s degree, thanks to 25 colleges and universities in the area..
Mayor of Miami Francis Suarez (Francis Suarez) also jumped at the opportunity to bring more top companies to his city.
When Delian Asparuhov (Delian Asparouhov), co-founder of Varda Space Industries, tweeted at the beginning of this month: «what if we move from Silicon Valley to Miami?», Suarez fast replied: «How can I help?».
«If you are interested in growing Miami’s reputation as an international tech startup and turning it into a city of the future, we are ready for dialogue. Let’s work together to take innovation and entrepreneurship to the next level», – he stated.
Co-founder of Reddit Alexis Ohanyan (Alexis Ohanian) moved from San Francisco to Florida a few years ago.
«The colleagues were shocked. They didn’t understand how we were going to do business from South Florida. Three years have passed since then and our business is doing well. Today I see more and more headlines about someone transferring cases from San Francisco to Miami.», – he said.
New York-based Goldman Sachs is also considering relocating some operations to Miami.