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Why one in four Silicon Valley homebuyers wants to leave

Why one in four Silicon Valley homebuyers wants to leave


At a recent conference, the founder of one technology titan asked another if it was even possible to build a platform-technology company outside of Silicon Valley. It was a fair question, given the dominance of GoogleFacebook and Apple. But from where I sat, it seemed easier to build a company of that size today almost anywhere except Silicon Valley. 

Others have had the same thought. A spate of start-ups and now venture funds have recently left Silicon Valley for LA (Snapchat), Chicago (Keepsake), Seattle (Sherbert) and even Ohio (Drive).

The company where I work, Redfin, understands this impulse better than anyone. We are real estate brokers, with technology used by 10 million-plus people each month looking to move. And the simplest trend we see in American life is that Silicon Valley is no longer just the place talented people move to; it's the place those people are moving from. (Tweet this)

The dam has broken

In 2011, 1 in 7 people in the Bay Area searched  for homes outside of the Bay Area. Now it's 1 in 4. As Adam Wiener, our chief growth officer, announced to other executives last month: "The dam has broken."

In the past four years, the number of Bay Area people searching for Seattle homes has quadrupled; for Portland homes, that number has quintupled. For every 13 Bay Area people searching for a home, one is now searching in the Pacific Northwest alone.

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Other than Snapchat I have not heard of any of their "spate of startups who left Silicon Valley".

Successful companies do not leave Silicon Valley.

But maybe some companies need to leave Silicon Valley to be able/allowed to become successful?

Maybe. The most successful tech companies outside Silicon Valley -- Microsoft and Amazon -- did not start in the Valley. 

You mean USA tech companies?

Yes. Are there big non-USA tech companies besides Alibaba?


Sony (Japan), Samsung (South Korea), Tencent (China), SAP (Germany), TSMC (Taiwan), Nintendo (Japan), Nokia (Finland), GDF Suez / Engie (France)

Never heard any of these names?

Those are all old school tech companies that predate the Silicon Valley startup scene. 

But I see your point. 

Because USA tech companies don't predate the Silicon Valley startup scene, and other countries' scenes?

Right. The only relatively new company you named is Tencent. 

Where will the next big tech companies start?

Just like Google, Facebook, LinkedIn, Twitter, Dropbox, Airbnb, and Uber, they will likely start in the SF Bay Area. Too much critical mass of people and money here for any other place to be as likely. 

Yeah, that's the only place to find 300 millions of rich potential costumers in one country.

Certainly China, India and Brazil soon to be the main big tech companies creators.

Maybe in EU when it will get more federal during this century. For now we have to fight the push of right wing extremists that is a consequence of the 2008 crisis. So much lost time.

I think actually you nailed it. It's hard to overcome the head start and critical mass that Silicon Valley has. It's easier to just come here. Even Samsung, Nintendo, Sony, Microsoft, Amazon, etc now have big innovation centers here. It's where the most money and people are. 

I wonder if the water problem in Cali could kill the Silicon Valley at some point?

Maybe it will become too expansive to transport enough water for huge concentrations of big companies one day?

No, the water problem in Cali is mostly political. 

There are economic solutions that can be rolled out whenever the politicians finally decide to act. 

I thought the companies were the ones ruling there.

Except for water?

Except for water, where politics rules.

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