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The main reason people flock to the Bay Area is because of the growth in the Tech industry. However, as we all know, there is very, very little technical reason

The main reason people flock to the Bay Area is because of the growth in the Tech industry. However, as we all know, there is very, very little technical reason that has to be there, or could not be spread out. The only reason really is the concentration of developers, and that VCs don't want to leave the peninsula. If we could change VC attitudes toward "You HAVE to be in the Bay Area," that could go a long way to spreading these things out, and stopping the explosion of housing prices up there.

aeorgnoieang 9y ago
Network effects are real and networking, as in meeting face-to-face, seems to have real tangible benefits that people are willing to pay what-seem-like-ridiculous costs to have.
- pascalxus 9y ago
  That's what we hear repeated over and over. But, I don't believe it to be the truth. I think it's far more simple. They're already here and they don't want to move.
  - dredmorbius 9y ago
    "They" could move. But you'd need to convince a lot of "them" to move. And you'd have to coordinate that move to a single second locale. The network effects and low-friction of local contacts are real. Distance is time and time is money. All take energy, infrastructure, and capital. Ironically, the more ephemeral a product, the more concentrated its development, because the one thing you need to work on it is people (including all the support and acilary staff). An earlier example of this was Hollywood. Films can be shot anywhere, and the end product was a few cans of celluloid that could be shipped to theatres. But it was the actors, and cameramen, and catering staff, and carpenters, and electricians, and equipment support, and musicians, and effects people, and .... that were expensive. And who'd clustered in Los Angeles. Factors that did lead to spreading out the industry? Language. And occasionally government regulation limiting the import of American film. But France, Italy, Spain, Germany, Russia, Japan, China, India: all developed their own local film industry, of at least some size, in large part because Hollywood couldn't make talking pictures their audiences could understand. (Also: cultural, location, and other factors, but language was a biggie.) So the friction of what language are we going to develop in (as in human language) actually lead to a decentralisation of production. Ironically: better and more efficient technology leads to greater density, not less. Though it's rapidly running up against housing-as-asset as a massive problem.
- s73ver_ 9y ago
  Right, but who says all that has to be in the Bay Area?
  - DoreenMichele 9y ago
    YC and other programs require you to move there to participate. If you move away after your program is over, the value of the contacts you made goes way down, to the point of approaching zero. This will cause a lot of people to stay. They know that leaving could kill their baby.
    - s73ver_ 9y ago
      That's my point; YC is just as much at fault here. They could easily hold YC anywhere else in the country. They just choose not to.
      - DoreenMichele 9y ago
        They started elsewhere, then moved to Silicon Valley because that is where the action is. They likely would not be where they are today had they not done that. Now that they are here, they have the same issue: moving would likely come at a very high cost and might well turn the company into a has been. Major changes to a company are always a risk. Even the founders may not fully understand all the pieces that make it a success, so trying to change the formula can kill the company. Presumably, the people running YC have no reason to move it elsewhere and lots of reasons to stay. Yes, their existence contributes to the housing issues there, but that isn't really a good reason to move the company. If they are concerned about it, there are other ways they can try to address it without risking killing their own company in the process.

aeorgnoieang 9y ago

Network effects are real and networking, as in meeting face-to-face, seems to have real tangible benefits that people are willing to pay what-seem-like-ridiculous costs to have.

pascalxus 9y ago
That's what we hear repeated over and over. But, I don't believe it to be the truth. I think it's far more simple. They're already here and they don't want to move.
- dredmorbius 9y ago
  "They" could move. But you'd need to convince a lot of "them" to move. And you'd have to coordinate that move to a single second locale. The network effects and low-friction of local contacts are real. Distance is time and time is money. All take energy, infrastructure, and capital. Ironically, the more ephemeral a product, the more concentrated its development, because the one thing you need to work on it is people (including all the support and acilary staff). An earlier example of this was Hollywood. Films can be shot anywhere, and the end product was a few cans of celluloid that could be shipped to theatres. But it was the actors, and cameramen, and catering staff, and carpenters, and electricians, and equipment support, and musicians, and effects people, and .... that were expensive. And who'd clustered in Los Angeles. Factors that did lead to spreading out the industry? Language. And occasionally government regulation limiting the import of American film. But France, Italy, Spain, Germany, Russia, Japan, China, India: all developed their own local film industry, of at least some size, in large part because Hollywood couldn't make talking pictures their audiences could understand. (Also: cultural, location, and other factors, but language was a biggie.) So the friction of what language are we going to develop in (as in human language) actually lead to a decentralisation of production. Ironically: better and more efficient technology leads to greater density, not less. Though it's rapidly running up against housing-as-asset as a massive problem.
s73ver_ 9y ago
Right, but who says all that has to be in the Bay Area?
- DoreenMichele 9y ago
  YC and other programs require you to move there to participate. If you move away after your program is over, the value of the contacts you made goes way down, to the point of approaching zero. This will cause a lot of people to stay. They know that leaving could kill their baby.
  - s73ver_ 9y ago
    That's my point; YC is just as much at fault here. They could easily hold YC anywhere else in the country. They just choose not to.
    - DoreenMichele 9y ago
      They started elsewhere, then moved to Silicon Valley because that is where the action is. They likely would not be where they are today had they not done that. Now that they are here, they have the same issue: moving would likely come at a very high cost and might well turn the company into a has been. Major changes to a company are always a risk. Even the founders may not fully understand all the pieces that make it a success, so trying to change the formula can kill the company. Presumably, the people running YC have no reason to move it elsewhere and lots of reasons to stay. Yes, their existence contributes to the housing issues there, but that isn't really a good reason to move the company. If they are concerned about it, there are other ways they can try to address it without risking killing their own company in the process.