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Pull Quote for me: >Contrary to the prevailing perception of business dysfunction and exodus of people since the start of Covid-19 pandemic, the San Francisco

Pull Quote for me: >Contrary to the prevailing perception of business dysfunction and exodus of people since the start of Covid-19 pandemic, the San Francisco Bay area accounts for 78% of the market capitalization of all publicly-traded companies in California, up from 70% five years ago. In essence, tech is fueling California more so than anything else, from what it seems. The growth is almost entirely due to tech industry wins. It'll be interesting to see what it is like 12-18 months from now, because the headwinds in tech are just starting to roll in full force before these statistics were finalized. California may see a bit of a down round next year. I will say though, despite a very lopsided and sometimes actively regressive tax structure and real estate problems in California, it does seem that this is still one of the best places in the world to grow a technology business. Non SV VCs never materialized with the strength the Silicon Valley VCs still command. I think Oregon and Washington are also seeing a pretty strong outgrowth from this, but at a much smaller scale. I feel like most of Texas tech scene wins have come from companies want to take advantage of the tax structure, and not from structural growth afforded to the region by lush VCs and risk taking entrepreneurs. Doesn't mean they don't exist (they really exist everywhere, see Mailchimp for instance) but it just isn't the same ballpark. It seems Texas has mostly only attracted well established companies looking to take advantage of structural tax advantages rather than growth opportunities. Of course, you may ask, why am I choosing to single out Texas? Because they made very public statements about coming after and luring in California businesses, especially tech businesses. Its clear that they didn't really put a big dent in this.

627467 4y ago
Can't we say that trends are roughly similar to trends observed when comparing US and Europe in past... 20+ years? Economic growth happens despite degrading social indicators?
- jeffbee 4y ago
  GDP growth and general well-being are not aligned. The more $50,000 emergency room bills we print and the more $2M toilets we construct, the better GDP looks.
  - NLPlatypus 4y ago
    But that money may have been spent elsewhere?
  - trollerator23 4y ago
    GDP growth is not, but GDP per capita is certainly aligned with general well-being. This is well documented.
- LeanderK 4y ago
  > 20+ years? Economic growth happens despite degrading social indicators? Where is economic growth in europe happening despite degrading social indicators? Are there really countries with significantly degrading social indicators & economic success over the last 20 years in europe? All countries I know some social indicators of are actually improving. Maybe inequality....I think that was increasing
modeless 4y ago
The dysfunction is concentrated in the city of San Francisco. The wider Bay Area is not as bad. Also, attributing the whole market cap or revenue of a multinational corporation to its headquarters is not really the best way to measure things. Also, this is a lagging indicator. A lot of this growth is occurring in companies that were founded before the worst dysfunction occurred. It doesn't mean dysfunction is not here now and won't affect future growth.
- simonebrunozzi 4y ago
  > The wider Bay Area is not as bad Lived in SF for 9 years (2012-2020), and visited many places in the whole bay area. I don't know what you're talking about, really. Bullet train? Slower than the slowest train in Italy. Homeless people? Try Mountain View, try San Jose. Only Marin County is a bit spared by it. Dirty? Expensive? Pretty much everywhere. Few exceptions, like downtown Palo Alto, around the Apple store. Really, you can't say it is "not that bad", unless you're forgetting there's the rest of the (civilized) world to compare it to.
- 988747 4y ago
  Yes, one could argue, that the state of Delaware should be the world's 4th economy, since most of the Bay Area companies are registered there (alongside many others).
- no_wizard 4y ago
  Which I point out as follows It'll be interesting to see what it is like 12-18 months from now, because the headwinds in tech are just starting to roll in full force before these statistics were finalized. California may see a bit of a down round next year. To your other point, regarding headquarters not being a good measure. I think the tech employee driven inflation of housing prices in the Bay area and surrounding metros (sometimes as far out as Sacramento. For non natives, that's ~2 hours away by drive, usually a more consistent 1 hr 30 minutes by train in my experience. Some corporate buses even go out to these farther out metros to pick up employees) is strong evidence that they're still hiring pretty locally, though with remote work in stronger force than ever, it is changing a bit, but those effects are yet to be determined in the common case, but it will upend some of this, 100% EDIT: I 100% agree about dysfunction in San Fransisco proper. Its a thing.
outside1234 4y ago
Texas is attracting companies that can't recruit in the Bay Area and/or whose execs don't want to pay income taxes.
- dahfizz 4y ago
  > and/or whose execs don't want to pay income taxes. So... Every single company?
  - slater 4y ago
    > and/or whose execs don't want to pay income taxes. So... Every single exec?
luckylion 4y ago
> It'll be interesting to see what it is like 12-18 months from now, because the headwinds in tech are just starting to roll in full force before these statistics were finalized. California may see a bit of a down round next year. As might Germany. High energy cost hurts a lot of German industries, so it could be about "who hurts more", and I'm not sure who wins if you're looking at bureaucracy being dysfunctional.
kodah 4y ago
Texas wants tech to replace some of its dependence on agriculture and oil. Comparing the two scenes seems wrong. Early on Silicon Valley siphoned talent out of Silicon Hill and adjacent businesses. It's going to take them a while to siphon that talent back to levels acceptable enough to create a growth tech economy. That means VCs, programmers, entrepreneurs, marketers, etc all have to make their way to the same-ish place in Texas. To say that businesses only go there for lax tax structure I think ignores why they left CA in the first place, which is they can't pay people enough to live there. I feel like at some point we'll have to force the spread of tech businesses across the United States. You can already see the effect of not doing so; SF is utterly unaffordable even for techies. The standard and cost of living are obtusely different from the rest of the country. I wager there's a lot of baggage that will come with this given that economics have a tendency of not observing state borders.
stjohnswarts 4y ago
Even Texas, as bad as it is here as a citizen, has diversified it's economy past just oil and gas in the past 30 years or so.

627467 4y ago

Can't we say that trends are roughly similar to trends observed when comparing US and Europe in past... 20+ years? Economic growth happens despite degrading social indicators?

jeffbee 4y ago
GDP growth and general well-being are not aligned. The more $50,000 emergency room bills we print and the more $2M toilets we construct, the better GDP looks.
- NLPlatypus 4y ago
  But that money may have been spent elsewhere?
- trollerator23 4y ago
  GDP growth is not, but GDP per capita is certainly aligned with general well-being. This is well documented.
LeanderK 4y ago
> 20+ years? Economic growth happens despite degrading social indicators? Where is economic growth in europe happening despite degrading social indicators? Are there really countries with significantly degrading social indicators & economic success over the last 20 years in europe? All countries I know some social indicators of are actually improving. Maybe inequality....I think that was increasing

modeless 4y ago

The dysfunction is concentrated in the city of San Francisco. The wider Bay Area is not as bad. Also, attributing the whole market cap or revenue of a multinational corporation to its headquarters is not really the best way to measure things. Also, this is a lagging indicator. A lot of this growth is occurring in companies that were founded before the worst dysfunction occurred. It doesn't mean dysfunction is not here now and won't affect future growth.

simonebrunozzi 4y ago
> The wider Bay Area is not as bad Lived in SF for 9 years (2012-2020), and visited many places in the whole bay area. I don't know what you're talking about, really. Bullet train? Slower than the slowest train in Italy. Homeless people? Try Mountain View, try San Jose. Only Marin County is a bit spared by it. Dirty? Expensive? Pretty much everywhere. Few exceptions, like downtown Palo Alto, around the Apple store. Really, you can't say it is "not that bad", unless you're forgetting there's the rest of the (civilized) world to compare it to.
988747 4y ago
Yes, one could argue, that the state of Delaware should be the world's 4th economy, since most of the Bay Area companies are registered there (alongside many others).
no_wizard 4y ago
Which I point out as follows It'll be interesting to see what it is like 12-18 months from now, because the headwinds in tech are just starting to roll in full force before these statistics were finalized. California may see a bit of a down round next year. To your other point, regarding headquarters not being a good measure. I think the tech employee driven inflation of housing prices in the Bay area and surrounding metros (sometimes as far out as Sacramento. For non natives, that's ~2 hours away by drive, usually a more consistent 1 hr 30 minutes by train in my experience. Some corporate buses even go out to these farther out metros to pick up employees) is strong evidence that they're still hiring pretty locally, though with remote work in stronger force than ever, it is changing a bit, but those effects are yet to be determined in the common case, but it will upend some of this, 100% EDIT: I 100% agree about dysfunction in San Fransisco proper. Its a thing.

outside1234 4y ago

Texas is attracting companies that can't recruit in the Bay Area and/or whose execs don't want to pay income taxes.

dahfizz 4y ago
> and/or whose execs don't want to pay income taxes. So... Every single company?
- slater 4y ago
  > and/or whose execs don't want to pay income taxes. So... Every single exec?

luckylion 4y ago

> It'll be interesting to see what it is like 12-18 months from now, because the headwinds in tech are just starting to roll in full force before these statistics were finalized. California may see a bit of a down round next year. As might Germany. High energy cost hurts a lot of German industries, so it could be about "who hurts more", and I'm not sure who wins if you're looking at bureaucracy being dysfunctional.

kodah 4y ago

Texas wants tech to replace some of its dependence on agriculture and oil. Comparing the two scenes seems wrong. Early on Silicon Valley siphoned talent out of Silicon Hill and adjacent businesses. It's going to take them a while to siphon that talent back to levels acceptable enough to create a growth tech economy. That means VCs, programmers, entrepreneurs, marketers, etc all have to make their way to the same-ish place in Texas. To say that businesses only go there for lax tax structure I think ignores why they left CA in the first place, which is they can't pay people enough to live there. I feel like at some point we'll have to force the spread of tech businesses across the United States. You can already see the effect of not doing so; SF is utterly unaffordable even for techies. The standard and cost of living are obtusely different from the rest of the country. I wager there's a lot of baggage that will come with this given that economics have a tendency of not observing state borders.

stjohnswarts 4y ago

Even Texas, as bad as it is here as a citizen, has diversified it's economy past just oil and gas in the past 30 years or so.