At the apex of Silicon Valley's fame, you'd think its realtors were engaged in some sort of subliminal campaign to lure in tech start-ups. What really made Silicon Valley the granddaddy of hot spots? Why did Boeing leave Seattle for Chicago? Why is Denver getting so much press? It's a fusion of many different elements.
Silicon Valley had been primed for its status starting in the '30s, when Stanford University began a campaign to become a radio and communications research center. It worked. Companies like Fairchild Semiconductor and Hewlett-Packard set up shop nearby. Since then, generations of entrepreneurs have crawled out of the woodwork. "There's an acceptability of risk-taking here," says Shanda Bahles, general partner at El Dorado Ventures, a Menlo Park, California, venture capital firm. "The people who took risks failed, and then did it again and were successful-those are the stories that make the rounds of entrepreneurs."
Another prime ingredient Bahles sees is a social one: "Because people change jobs so often, whether in a new position at an established company or doing a new start-up, they continue to have business and personal relationships that are intertwined," she says. "You may be having dinner with someone you've known for 20 years and really trust and say, 'Hey, I'm starting a new company. Come do this with me.' That's the sort of thing you don't get just everywhere." And it's that vibe people felt when they arrived in Silicon Valley.
So what should we look for in the next hot spot? Look for vibrancy, says John Challenger of international outplacement firm Challenger, Gray & Christmas Inc., whose survey of job-seeking executives and managers found Austin; Charlotte, North Carolina; Chicago; Denver and San Diego to be the most favored. A vision for the future, however, is just as critical to creating a vibe that will invigorate businesses. "Some cities feel modern and cutting-edge, like they're looking forward and not relying on any one industry or set of companies to dominate its cultural, civic and corporate landscape," Challenger says.
Though hot spots change, if you look at a city's infrastructure, government, educational facilities, employee base, hometown corporations and livability, then you may find your prime locale, regardless of its "hot" status. But if you're interested in planting down in the nation's next hot spot, you may find it, ironically, in Silicon Valley. Now that people have jumped off the dotcom bandwagon, rents are down, traffic has thinned, and, best of all, business is making sense again. "For the past six months, we've only been seeing serious entrepreneurs [pitching their companies]," says Bahles. "It's not just people saying, 'Wow, everybody's making millions in Silicon Valley. I think I'll do that, too.' They know what it takes and they've got the experience."
Are techies the new bohemians? A new study suggests they might be. High-tech workers tend to flock to cities that seem more tolerant and diverse as evidenced by gay, artistic and foreign-born resident communities, according to a study released by The Brookings Institution.
The study notes that in the past, companies would locate near transportation hubs or natural resources-the necessary ingredients for business. Now that talent is a factor, it's smart to go where key workers gather. The top cities for both diversity and high-tech success include Boston, Los Angeles, New York City, San Francisco, Seattle and Washington, DC.-L.T.
- Challenger, Gray & Christmas Inc., (312) 332-5790