San Francisco’s Tech Employees Are Leaving the Bay Space

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San Francisco's Tech Workers Are Leaving the Bay Area

SAN FRANCISCO – The Bay Area has done tough business with its technicians.

The rent was astronomical. The taxes were high. Your neighbors didn't like you. If you've lived in San Francisco, you might have driven an hour south to your job at Apple, Google, or Facebook. Or, if your office was in town, it might be in a neighborhood with too much street crime, open drug use, and $ 5 coffee.

But it was worth it. It came down to living in the epicenter of a boom that was changing the world. The city gave its workers a choice of interesting jobs and a chance at the brass ring.

That is, until the pandemic. Remote work was an opportunity to live for a few months in cities where life felt easier. Technicians and their bosses realized that they may not need all of the perks and post-work schmooze events. But maybe they needed freedom of movement and a yard for the new pup. A place to place the peloton. A top public school.

They fleed. They fled to tropical beach towns. They fled to cheaper places like Georgia. They fled to states with no income tax like Texas and Florida.

This is where the Bay Area's newest tech era ends for a growing crowd of tech workers and their businesses. You suddenly have moving jobs and money in the bank – money that goes much further elsewhere.

But where? Austin, Texas is the number 1 for people to leave San Francisco according to moveBuddha, a website that compiles relocation dates. Austin, Texas, and other winners including Seattle, New York, and Chicago. Some cities have even set up recruiting programs to lure them into new homes. The Mayor of Miami even invited technicians to move there on his Twitter posts.

I've spoken to more than two dozen technical executives and workers who left San Francisco for other parts of the country in the past year, such as a young entrepreneur who moved to Georgia and another who started a community in Puerto Rico . Here are some of their stories.

“I miss San Francisco. I miss the life I had there, ”said John Gardner, 35, the founder and CEO of Kickoff, a personal training start-up that packed up its things in a warehouse and left in an RV to wander America . "But at the moment it's just like this: What else can God, the world and the government come up with to make the place less livable?"

A few months later, Mr. Gardner wrote, “Greetings from sunny Miami Beach! This is roughly the 40th place I've set up a temporary headquarters for kickoff. "

While remote personal training coincides well with remote living, he said his startup's growth over the past year was also due to leaving the tech bubble and immersing himself in more normal communities for a few days.

The biggest tech companies are going nowhere, and tech stocks are still rising. Apple's flying saucer campus won't zoom out. Google is adding more and more office space in San Jose and San Francisco. New founders are still coming to town.

But the migration from the Bay Area seems real. San Francisco home rents are down 27 percent year over year and the vacancy rate for offices rose to 16.7 percent, a number that has not been reached in a decade.

Although prices were only marginally lower, Zillow reported more properties for sale in San Francisco than a year ago. For more than a month last year, 90 percent of searches involving San Francisco in moveBuddha were for people moving out.

Twitter, Yelp, Airbnb, and Dropbox all tried to sublet some of their San Francisco office space. Pinterest, which has one of the city's most iconic offices, paid $ 90 million to cancel a lease on a location that was due to expand. And companies like Twitter and Facebook have announced plans to work from home forever.

"Moving to a $ 1.3 million house that we only watched on video for 20 minutes and rated yes," wrote Mike Rothermel, a Cisco designer who worked with his wife from the Bay last summer Area to Boulder, Colorado. "It's a villa compared to SF for the same money."

The amount of space they found surreal after different apartments in the Bay Area. He told me that they have enough counter space that they can store appliances like the food processor in the kitchen itself.

And then the people around them – neighbors – started doing something strange. They brought cinnamon buns and handwritten greeting notes.

“We're selling our house and moving out of SF. Where should we go and why?” Justin Kan, a serial entrepreneur who co-founded Twitch, asked on Twitter in August.

Joe Lonsdale, co-founder of Palantir software company that moved to Denver from Silicon Valley, wrote back, “Come to Austin with us. The growing tech ecosystem and Texas are the best place to join forces for a free society. "

Also: no state income taxes.

Austin, a million people and the city of Texas, which most would say comes closest to the Bay Area, has long had a healthy tech industry. The computer giant Dell has its headquarters nearby. The University of Texas is one of the best public universities in the country. And the music scene is diverse and creative.

Now the local tech industry is growing rapidly. Apple opens a $ 1 billion campus. Alphabet, Amazon, and Facebook either have or plan to expand their presence in Austin. Elon Musk, the Tesla founder and one of the two richest men in the world, said he moved to Texas. Start-up investor funds are also arriving: the investors from 8VC and Breyer Capital opened offices in Austin last year.

Some of the tech guru's favorite gurus are already there, like Tim Ferriss, life hacker who went to Austin in 2017, and Ryan Holiday, whose writing about stoicism has swayed the start-up set.

Sahin Boydas, the founder of a remote working start-up who had lived in San Francisco and its suburbs for the past decade, saw all of this. He looked at his wife and two young children who worked and learned from home, while crammed into a Cupertino rental property that had seen better days. For much of late summer the air was full of smoke from forest fires. Electricity went in and out of his house for days.

"You're starting to feel stupid," said 37-year-old Boydas. "I can understand the 1 percent rich, the best investors and entrepreneurs who can be happy there."

So he and his family moved to Austin. For the same price as their three bedroom apartment in Cupertino, they have a five bedroom house on one acre of land. For the first time, Mr Boydas has a place outside. He just bought two rabbits for his children. Sure, it's (very) hot, but he's ready for it.

"We're going to have a cat and a dog," he said. "We've never been able to do that."

And it's not just the rental costs that are lower – the water bill is lower. the garbage bill is lower; The cost of a family meal in a restaurant has dropped significantly. Mr Boydas said he didn't even know about taxes.

"I run a payroll for myself and when I saw zero I called the accountant like there was a mistake – there is no control line here," he said. "And they said," Yes, there is no tax. "

"Ok guys, listen to me what if we move Silicon Valley to Miami," tweeted Delian Asparouhov, a principal at Founders Fund, who invests in startups.

The Mayor of Miami wrote back last month, "How can I help?"

Now there's a very vocal Miami faction, led by some venture capital influencers, trying to bring the city's startup world to life.

The San Francisco exodus means the talent and money of the newly remote technicians are up for grabs. And it's not just the Mayor of Miami trying to lure them in.

Topeka, Kan., Launched Choose Topeka, which reimburses new workers $ 10,000 for the first year of rent or $ 15,000 for home purchases. Tulsa, Okla. Pays you $ 10,000 to move there. The nation of Estonia has a new residency program for digital nomads only.

A program in Savannah, Georgia will reimburse remote workers for $ 2,000 to move there, and the city has launched various social activities to introduce the newcomers to each other and the locals.

"We're trying to make the transition easier," said Jennifer Bonnett, vice president of innovation and entrepreneurship for the Savannah Economic Development Authority, whose program began in June.

Keyan Karimi, 29, and a startup investor, accepted Savannah's invitation to move there (although he hadn't asked for any reimbursement).

He saw the inequality of the billionaires in San Francisco's affluent Pacific Heights neighborhood and the homeless camps on top of it. So, Mr Karimi went home to his parents' home in Atlanta to ride out part of the pandemic. Then he discovered something strange. The town he thought was boring had gotten quite interesting. Or maybe he just had never noticed.

“I had no idea how busy was going on here. I was kind of short-sighted, "he said, pausing and correcting himself:" No, I was arrogant. "

Mr. Karimi started looking at Zillow and studying the southern cities that he had ignored. He likes old houses and wants to fix one. Savannah has a lot of them. Just months after leaving his monthly one-bedroom bedroom in San Francisco for $ 4,000, he is working with the local business development group to set up a maritime innovation center in Savannah that will host startups in the shipping industry and logistics invested and these should be managed. He bought one of those old houses.

Savannah has one of the largest ports in the country. "Nobody knows," said Mr. Karimi. "I think we can do something with it."

The only downside are mosquitos, he said. "I'm being eaten alive."

There are 33,000 members in the Leaving California Facebook group and 51,000 in its sister group Life After California. People post pictures of moving trucks and links to Zillow deals in new cities.

The founder of both groups, Terry Gilliam, plans to take members on a house-hunting trip through eastern Tennessee this spring, with stops at the popular Post-S.F. Take away. Aims. One tour will be Chattanooga, Knoxville and Johnson City.

"When people decide to leave San Francisco, they usually don't know where they're going, they just want," said Gilliam.

Mr Gilliam, who met his wife while they were working in a chilli restaurant in the Bay Area, said she would not let the family move yet. And so the pied piper of the California Facebook community is still in Fremont at the eastern end of Silicon Valley.

"People are always mad at me when they hear birds in my zoom," said Ed Zaydelman, a longtime leader of the Burning Man community in San Francisco (and former New York club promoter), a Costa Rican business community . "And I say," Come on, join in. "

If San Francisco has proven anything of the 2010s, it's the power of proximity. Entrepreneurs were within walking distance of a dozen start-up pitch competitions each week. When they left a big tech company, there were startups they liked to hire, and when one startup failed there was always another.

You could live in a sprawling Victorian style with other nerds who – thanks to Polyamory's popularity – had lots of sex. The Bay Area was making more money, faster than ever before in American history.

Nobody who leaves town argues that Zoom will create a culture of innovation. So some are trying to recreate it. You start off by developing real estate, building luxury small farmhouses, and taking over large, funky homes in old resort towns.

"All these people want to do is this country life, but it's not as easy as people think," said Zaydelman.

He calls his new development company Nookleo and sets up five small shared apartments for remote workers. The small houses cost between $ 30,000 and $ 40,000. Each facility has four to six houses, a small organic farm, yoga deck, swimming pool, and a clubhouse in the kitchen. Two clusters are already underway in Costa Rica, followed by Mexico and Portugal.

In Puerto Rico, Gillian Morris, the founder of the Hitlist travel app, is also recruiting. Her breaking point in San Francisco came after her roommate was attacked on her street, and she checked herself out to see if the street scenes and the sense of danger were worth the high rent. She moved to San Juan in 2019 despite having a crime problem as well. But now she lives in a huge house in the middle of the city.

"I have 12 people leaving San Francisco in the next three months to join a community that I started," she said. "It's amazing here."

And for the Baja inclination, there's Bear Kittay, co-founder of Good Money, an online banking platform. Now Mr. Kittay, another long-standing fixture of the Burning Man Festival, which became the developer, is building a plot of land for the new digital nomads.

"The things that make this city sick are beyond my control," he said of San Francisco. "A lot of people choose to go to places where there is opportunity. Perhaps this is a place that is more conservative and can lead to an integration of dialogue." Or a place where they can live closer to nature. We do that. "

Nikil Viswanathan, co-founder of the blockchain start-up Alchemy, recently fled San Francisco. He said that there was no longer any need for him or his colleagues to be there and that he always wanted to live on the beach. Now he's doing it in San Diego.

But the expats can still be found. Not so long ago, he stumbled upon a cluster at a party.

"I knew it was an S.F. Crew, because when I entered I had the full double monitor with the ergonomic keyboard on a standing desk, ”Viswanathan said, adding that the conversation centered on the lower cost of living. "One of the S.F. Guys said, “I just had a $ 6 burrito. It was wonderful. & # 39; "

The last burrito he had in San Francisco was $ 15.

Longtime Bay Area residents can tell people like Mr. Viswanathan a good exemption. People who suspected the young newcomers from the start will say this change is a good thing. Wasn't this rapid increase in wealth and population in a tiny region always unsustainable?

These technicians came like a whirlwind. Virtually every community from San Jose in the south to Marin County in the north has battled the rise of new housing for the newcomers in the past decade. Perhaps it is wise to spread the technical talent across America.

Locals have seen this piece before too. Moving vans take away a generation of technical ambitions, and a few years later, moving vans return with new dreams and new ambitions.

After the dotcom bankruptcy in 2001, there were fallow years before the last, long-lasting boom – just like fallow years after the consolidation of the PC industry a decade earlier. That led to the dot-com boom. It's the cycle of life in the Bay Area.

And those who stay dig in. "When 12 friends left it felt like I passed out," said Diana Helmuth, a 32-year-old writer and marketer in Oakland. “As if these forces were too great. The forces of the world felt too great. "

Now, however, it is hardening against those who say life is better elsewhere and they were only in town for a job. "I say," Great, goodbye, have a great time elsewhere. "