Chicago tries to woo tech workers in Austin, elsewhere

[iheartthed]

Originally Posted by mhays

I'll say it again. Tech likes the cores of urban cities. SF, Seattle, and NYC in particular have a lot of urban tech. In Seattle's case, half of all tech jobs are in the urban core (my guess) and a large percentage of the rest is in other urban locations such as Downtown Bellevue or central Kirkland. Also the urban core dominates local biotech.

Some tech companies want to hire 35-year-olds with families, for stable, long-term positions. For example legacy companies and companies in commodity fields...think Office Space. These often gravitate toward suburban locations.

But others focus on hiring 20-somethings and "stars," and focus more on new innovation and the next big thing, or they're on the creative side like gaming. Some big companies are like that. These increasingly gravitated toward urban locations pre-Covid. They pay six figures so their employees can afford it.

Yeah, it depends on the tech sector and era of founding. There was a shift in the late 00s for tech startups to root in cities. Prior to that, tech had been biased to suburban office parks. Airbnb, Uber, Lyft, Slack, were all founded 2008 or later and were all based in San Francisco. Facebook, Google, Netflix, were all founded before 2008 and are all based in suburban Silicon Valley.

[the urban politician]

Originally Posted by dimondpark

Nothing wrong with a city marketing itself, Chicago has a lot to brag about and it is truly one of the most stunning Urban environments in the country. The Texas model appears to be throwing tax breaks and a bunch of free stuff to lure companies down there, and that has served their desire to bring companies there, fine, but neither Austin nor anywhere else in the rest of Texas has a particularly strong Innovation ecosystem as far as funding and incubation imo. That's why I think Chicago would be better served leveraging the uber prestigious academic institutions in and around the city, namely Northwestern, and University of Chicago(talk about top tier) plus the U.of Illinois at Urbana-Champaign has a very good reputation in Silicon Valley.

What are their engineering students up to? How can their ideas benefit from Chicago's massive investment banking network? How about focusing on being more inclusive than Silicon Valley has been.

I dunno, just a thought.

I think Chicago is trying to throw the whole kitchen sink at the “problem” of why it lags its peers in VC and tech given its size and stature.

But I think it’s conservative culture is one of the main culprits—for better or worse

[galleyfox]

Originally Posted by The North One

There's nothing wrong with promoting your city though, cities can benefit from good marketing. But that mainly comes in the form of investors and tourism. I don't think anybody moves across the country because of a good marketing campaign.

Let’s not forget this is a publicity release from a private tech VC advocacy group. A relatively small VC fish that just got a notable boost of business press coverage by announcing a call tree.

Mission accomplished.

I doubt P33 itself expects anything beyond advertising and contacts from this, much less large scale relocations. But it’s not an official city of Chicago economic or marketing initiative.

[dc_denizen]

Chicago >>> Austin

I’d rather live in a grown up city than in the worlds biggest college campus.

The west loop seems like a great location for a startup

Time to pack my bags ...

[iheartthed]

Originally Posted by the urban politician

I think Chicago is trying to throw the whole kitchen sink at the “problem” of why it lags its peers in VC and tech given its size and stature.

But I think it’s conservative culture is one of the main culprits—for better or worse

Here's some free advice for Chicago. Get the regional high net worth individuals to invest in a venture fund that only invests in startups that are based in Chicago. That will go way, way, way, farther than hoping natives migrate back on their own. People are missing the part of the story that Silicon Valley venture funds wouldn't invest outside of the Bay Area until recently, and that's why the current winners are so concentrated there now.

[SIGSEGV]

Originally Posted by iheartthed

Here's some free advice for Chicago. Get the regional high net worth individuals to invest in a venture fund that only invests in startups that are based in Chicago. That will go way, way, way, farther than hoping natives migrate back on their own. People are missing the part of the story that Silicon Valley venture funds wouldn't invest outside of the Bay Area until recently, and that's why the current winners are so concentrated there now.

this is already happening to some extent (in no small part from our billionaire governor). But the point of this campaign is really to get people with roots in the area or who attended UC/NW/UIUC who aren't paying attention to realize that there is a nascent VC ecosystem here. Of course, I feel like most people probably already know that to some extent so it does seem a bit silly in that regard. But this is working on addressing Chicago's (and Champaign's) brain drain problem.

[mhays]

Originally Posted by iheartthed

Yeah, it depends on the tech sector and era of founding. There was a shift in the late 00s for tech startups to root in cities. Prior to that, tech had been biased to suburban office parks. Airbnb, Uber, Lyft, Slack, were all founded 2008 or later and were all based in San Francisco. Facebook, Google, Netflix, were all founded before 2008 and are all based in suburban Silicon Valley.

Even the suburban-HQ'd companies often put offices in urban locations.

In my region, Apple is on the edge of Downtown. Google's four campuses range from edge of Downtown to moderately suburban. Facebook has several Downtown-edge buildings plus a TOD campus despite also having several buildings that are purely suburban. Salesforce/Tableau is in the urban core and a couple suburban downtowns. Adobe is in an urban district. A constellation of smaller offices of large techs I'd guess is 2/3 urban.

I suspect that some of those big suburban-HQ'd companies wish they were urban HQ'd. Or at least part of any firm wishes that...starting with the part who wants to hire the world's best and brightest 20-somethings.

[iheartthed]

Originally Posted by mhays

Even the suburban-HQ'd companies often put offices in urban locations.

In my region, Apple is on the edge of Downtown. Google's four campuses range from edge of Downtown to moderately suburban. Facebook has several Downtown-edge buildings plus a TOD campus despite also having several buildings that are purely suburban. Salesforce/Tableau is in the urban core and a couple suburban downtowns. Adobe is in an urban district. A constellation of smaller offices of large techs I'd guess is 2/3 urban.

I suspect that some of those big suburban-HQ'd companies wish they were urban HQ'd. Or at least part of any firm wishes that...starting with the part who wants to hire the world's best and brightest 20-somethings.

Yeah, same here in NYC. Google and Facebook have both rehabbed pre-war Manhattan buildings to serve as their NYC hubs. And Amazon has a ton of space in Hudson Yards. They'll probably end up with as many (or more) employees in NYC as they promised in the "failed" HQ2 plan.

[ardecila]

I think tech is probably agnostic on city vs suburb by now. Famously the pioneers all started in suburban garages or generic San Jose office parks with cheap space, but now it's just about the particulars of the business plan and what environment makes the most sense. If you're making software, then downtown is just as good as the burbs. If manufacturing or mfg-adjacent, then you might need to be in the suburbs so you can co-locate your designers and developers with your plant.

Of course, the campaign in this thread is also agnostic on city vs suburb. Chicago has a vast swath of suburbia too, and we are happy to accept new innovative businesses anywhere in the region.

Also, this campaign is far from the only strategy that Chicago leaders are working on. There are plenty of efforts to harness and boost the power of local universities.

[dimondpark]

Oh, another thing. Ro Khanna, local congressman, is a huge proponent of spreading tech wealth to the heartland...

https://www.washingtonpost.com/opini...ith-heartland/

[The North One]

Originally Posted by homebucket

Tech companies are comprised of predominately white and Asian nerds/geeks. Not exactly frat bro material.

That's a stereotype, not everybody who codes is a nerd. There are plenty frat bros mixed in there, lol.

[ocman]

Originally Posted by the urban politician

Yep. But the reason is simple—urban cities are just not going to offer less red tape, lower taxes, less burdensome regulations as places out in Texas/Florida. They aren’t even planning on trying. Their best bet is to sell the “cool” factor. I think it’s mostly smoke and mirrors and most company owners will see right through it. But some WFH employees might be willing to make he move to be closer to home.

Florida's "How can I help?" campaign that's succeeding in stealing so much of both the tech and restaurant industries from NY is brilliant. From what I hear, almost at every level from permits/licenses to construction, there's an energy where the city/state want you to succeed and wants you to open there, breaking down as many barriers as possible to speed up the process and get you out as soon as possible. I can't imagine that kind of generosity happening in SF or NYC, our politicians asking "How can I help?"

[KevinFromTexas]

Originally Posted by harryc

A power grid that stays up - reproductive rights - 597' above sea level .

and better burritos.

My neighborhood in South Austin is 700 feet above sea level.

Tacos>burritos

Originally Posted by Camelback

Tech (techie type buildings) isn't a very urban industry. Chicago could probably build a huge open space campus style tech development on the Southside though.

30 years ago that was true and was reflected here, but not anymore. Austin has all the big tech companies here in several towers downtown. Google is building their 2nd office tower here across from their first one in a 35-story 594 foot tower that will likely become iconic for Austin. Factories are still huge and pretty much have to be outside of the city's core, but we're seeing plans for a light rail leading to the new Tesla plant here east of the airport.

[Camelback]

Originally Posted by KevinFromTexas

30 years ago that was true and was reflected here, but not anymore. Austin has all the big tech companies here in several towers downtown. Google is building their 2nd office tower here across from their first one in a 35-story 594 foot tower that will likely become iconic for Austin. Factories are still huge and pretty much have to be outside of the city's core, but we're seeing plans for a light rail leading to the new Tesla plant here east of the airport.

Water flows downhill. At times, we want it to reverse and that's why we all continue to have open discussions amongst ourselves: why and what if this and that. The answer is simple, water prefers the least resistant path.

[SIGSEGV]

Originally Posted by Camelback

Water flows downhill. At times, we want it to reverse and that's why we all continue to have open discussions amongst ourselves: why and what if this and that. The answer is simple, water prefers the least resistant path.

says the person from Phoenix .

Chicago famously does not pay attention to the way the water is supposed to flow.

[DCReid]

Chicago is wasting its time going after Austin and other tech heavy cities. I have not heard it doing that badly concerning lack of tech companies, plus it has a diverse amount of industries besides tech. If anything, it should develop its biotech industry, which I believe it is doing, its fintech industry, and its alt-energy industry (there are two big nuclear labs in the area). Chicago really needs to make an effort to stabilize the west and south sides, as its reputation is taking a hit from the bad publicity from those areas. For one, I don't understand why it is not offering a store like Aldi incentives to open grocery stores in those areas. It's hard to say how to stem the African-American outflow from those areas, but maybe a better effort to attract more recent immigrants to Chicago. It seems that Minneapolis and Columbus attract more of the recent immigrants than Chicago.

[ocman]

Originally Posted by ardecila

I think tech is probably agnostic on city vs suburb by now. Famously the pioneers all started in suburban garages or generic San Jose office parks with cheap space, but now it's just about the particulars of the business plan and what environment makes the most sense. If you're making software, then downtown is just as good as the burbs. If manufacturing or mfg-adjacent, then you might need to be in the suburbs so you can co-locate your designers and developers with your plant.

Tech definitely is agnostic.. But that's the reason suburbs and Texas, and now N.Carolina keep winning. Cities and burbs aren't on equal footing. By most measures, the costs and ease is always going to be more advantageous in the burbs than a highly regulated city like SF. So companies go to the burbs. But if you're Amazon/Apple, there's a strategic need to be in, say, LA, where you want to build up your streaming service and so you tap into its already existing industries. City politicians think tech is all TikTok, Netflix and cool start-ups with cool young hipsters playing ping pong. But that's a small segment (not to mention laughably untrue) of the whole industry. They want to jump straight into the glamour of having the next young hip unicorn start-up without grasping what the whole industry really is.

But Austin succeeds in attracting the "boring, dinosaur" tech jobs where most people don't know the integral things they really do, but they rooted themselves in Austin and created the foundation of everything there. Austin is now in every companies' conversation of expansion without even trying. And new "trend" companies are going there too because their tech is well-rounded and it feeds off each other. When they need talent to do something more abstract and difficult, they need the dinosaur with experience, not someone who came from WeWork.

[JManc]

Originally Posted by mhays

I suspect that some of those big suburban-HQ'd companies wish they were urban HQ'd. Or at least part of any firm wishes that...starting with the part who wants to hire the world's best and brightest 20-somethings.

Those 20-somethings might prefer an urban setting but they are going trip over themselves to work for Big Tech regardless of setting. Who is going to turn down a six-figure gig for Apple because their campus is in Cupertino? And not downtown San Francisco?

[Shawn]

"Tech" is so broad. Some tech sectors are by their nature location agnostic and can easily exist in a remote/hybrid work environment. Fintech, adtech, consumer-facing app+services, and general back end development largely fall into this group. Chicago can encourage remote work or even full relocation in these tech areas and likely find some success.

But other tech sectors, specifically med/biotech and robotics/nanotech, are super cluster-oriented by necessity. Remote work isn't that viable for most roles in these verticals. And the clustering benefits compound over time: the percentage of biotech and nanotech VC going to Boston/Cambridge, Silicon Valley, NYC, and San Diego has only increased the past 20 years, even as many other cities have started biotech incubators with generous tax incentives. (Homer Alert) Boston in particular keeps distancing itself from the rest of the pack. Biotech is incredibly capital-intensive, takes decades to pay off (if it ever does - plenty of products never make it past trials), and needs a steady pipeline of highly-specialized labor.

I'm not saying Chicago couldn't start a biotech incubator, but it's a little late to jump into biotech and medtech and expect payoff commensurate with the startup costs and time until investment return.

I bet AI and logistics would also be ideal high-value tech sectors for Chicago to nurture, and both are more "open" than biotech/medtech.

[SIGSEGV]

Originally Posted by JManc

Those 20-somethings might prefer an urban setting but they are going trip over themselves to work for Big Tech regardless of setting. Who is going to turn down a six-figure gig for Apple because their campus is in Cupertino? And not downtown San Francisco?

since housing in Cupertino is unobtainium, probably quite a few people actually.