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  #101  
Old Posted Jan 22, 2021, 6:44 PM
iheartthed iheartthed is offline
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Originally Posted by bossabreezes View Post
I think everyone understands that Austin has been big in tech for a long time. I think the confusion is why this is the case. Why did Austin become big in the scene even in the early days of the computer? It's definitely an outlier, and I would say its the only significant tech hub off of the coasts.

I think because it's the state capital of a very populous Texas also plays a part into its success to draw from itself and its own talent pool, but would guess that the university there might have been some sort of pioneer in the industry. Nothing other than that makes huge sense, considering no other tech hub is in any way related to being in proximity of an Oil Industry based city.

Also, Austin was never a large city where tech started to incubate- it seems like it was an expansion location for most companies rather than the place that hatched the actual innovation. The major innovation has almost always come from SF and the Bay Area, and even though there is some difficulty there now, I don't see that changing long term.

My personal opinion is that Austin now provides a pool of talent in the industry at a critical mass to attract companies to move ops there, because it's a cheap alternative to San Francisco, The Bay or New York. This potentially means it could be replicated anywhere (ops), but traditional innovation cores are likely to remain the hotbeds of new ideas.
I don't think Austin is really an outlier. There have been a few humongous tech companies founded away from the Bay Area. AOL, which was at one point he biggest tech company in the world, was located in northern Virginia. CompuServe, which was also a humongous tech company, was founded in Columbus, Ohio. And then obviously Microsoft and Amazon were founded in Seattle.

What has really set the Bay Area apart is the venture capital funding apparatus, which had been fairly unique to that region until recently. As I pointed out before, Austin is attracting a LOT of those venture capital dollars now, especially in proportion to its size. It's attracting more of that money than pretty much every city that is not San Francisco or NYC. That's what is fueling the current tech boom there (and it could also be fueling a bubble).
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  #102  
Old Posted Jan 22, 2021, 6:44 PM
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Originally Posted by iheartthed View Post
I don't know if oil money really set Austin apart from other cities in its category (such as Nashville, Columbus, Charlotte, Memphis, Birmingham, Raleigh). I think UT Austin and SXSW had way more to do with its recent success.
It absolutely was. Oil booms provided much of the base capital and Houston and Dallas VCs and established companies invested in technology in Austin (and in Dallas and Houston too). People seem to forget or not know that Houston and Dallas were (and are) major engineering technology centers for aerospace/defense, energy, electronics/semiconductors, and telecom.

Companies like Texas Instruments, EDS, Raytheon, General Dynamics... these are major palyers in the history of "tech", with large presences and/or foundings in Texas... especially in the DFW area. Most people likely have no idea that the DFW area is one of the founding centers of electrical technology in the US.

Texas Instruments and Bell Labs invented and refined the world's first transistors, silicon transistors, and microchips in Dallas.

Having UT there and TAMU nearby, plus things like SXSW, the whole live music scene, etc. have no doubt had a major influence. But the seed for everything that has happened there is big Texas money. Austin didn't just magically happen because it was a cool place.

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Originally Posted by DCReid View Post
Sounds about right - especially for the tech part. Tech has had an outsized influence on Austin given its size. I remember in the 1980s reading about how the metro had just gone over 1 million and Dell employed 20000 people there. Dell was one of the top 3 predominate tech companies then, sort of as prominent as Apple is now. Now it has a critical mass of tech, and combined with being cheaper than the coasts, and negative rap California is getting, it is drawing those businesses away. Of course, Austin is not the only metro with explosive growth over 30 years - Phoenix comes to mind but Columbus Ohio is even growing much than one would expect, but Austin is getting a lot of publicity partly due to the political divide encompassing the most powerful 'blue' state and 'red' state.
Yeah, the fact that it is the capital and "coolest" city of the huge economic powerhouse that is Texas, makes it all that much more attractive for an educated class of people from all over to relocate there... and receive the national attention for it. It's a self-perpetuating cycle.
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  #103  
Old Posted Jan 22, 2021, 7:22 PM
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Austin has always had a cool factor when it was just a big college town. It was the Live Music capital before it had SXSW and was always highly educated between UT and the state bureaucracy and things just coalesced from there. Indianapolis, Birmingham, etc don't have a coolness factor...which does factor in to a degree. People either move to Austin for school (and stay) or move their seeking opportunities and the jobs eventually do follow. I am currently in the job market myself and in my field, Austin is hot while Houston is sluggish and may have to take something in Austin for a while.
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  #104  
Old Posted Jan 22, 2021, 7:28 PM
bossabreezes bossabreezes is offline
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Originally Posted by iheartthed View Post
I don't think Austin is really an outlier. There have been a few humongous tech companies founded away from the Bay Area. AOL, which was at one point he biggest tech company in the world, was located in northern Virginia. CompuServe, which was also a humongous tech company, was founded in Columbus, Ohio. And then obviously Microsoft and Amazon were founded in Seattle.
Sure, but is Northern Virginia or Columbus known as a tech hub now at the same level as Austin? No.

Tech companies can and are founded everywhere/anywhere. I'm not talking about that, I'm talking about place with a concentration so high of tech company bases that they are known as major tech hubs, where the dominant industry is tech.

First thing that comes to mind when you think of Austin is tech. First thing that comes to mind when you think of NoVa is government. First thing that comes to mind with Columbus certainly isn't tech. SF= Tech, Seattle = Tech, ect.

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Originally Posted by pj3000 View Post
It absolutely was. Oil booms provided much of the base capital and Houston and Dallas VCs and established companies invested in technology in Austin (and in Dallas and Houston too). People seem to forget or not know that Houston and Dallas were (and are) major engineering technology che whole live music scene, etc. have no doubt had a major influence. But the seed for everything that has happened there is big Texas money. Austin didn't just magically happen because it was a cool place.
I see the thought process here, but why did Houston and Dallas decide to pour money into Austin rather than just invest tech dollars into their respective, larger cities? This is why I still find Austin's growth and stature the be somewhat serendipitous.
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  #105  
Old Posted Jan 22, 2021, 7:29 PM
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Originally Posted by pj3000 View Post
It absolutely was. Oil booms provided much of the base capital and Houston and Dallas VCs and established companies invested in technology in Austin (and in Dallas and Houston too). People seem to forget or not know that Houston and Dallas were (and are) major engineering technology centers for aerospace/defense, energy, electronics/semiconductors, and telecom.

Companies like Texas Instruments, EDS, Raytheon, General Dynamics... these are major palyers in the history of "tech", with large presences and/or foundings in Texas... especially in the DFW area. Most people likely have no idea that the DFW area is one of the founding centers of electrical technology in the US.

Texas Instruments and Bell Labs invented and refined the world's first transistors, silicon transistors, and microchips in Dallas.

Having UT there and TAMU nearby, plus things like SXSW, the whole live music scene, etc. have no doubt had a major influence. But the seed for everything that has happened there is big Texas money. Austin didn't just magically happen because it was a cool place.



Yeah, the fact that it is the capital and "coolest" city of the huge economic powerhouse that is Texas, makes it all that much more attractive for an educated class of people from all over to relocate there... and receive the national attention for it. It's a self-perpetuating cycle.
Well said....

Geography + solid public universities (funded in part by oil royalties) + spill over investment/knowledge base from two nearby major metros + really good marketing (keep austin weird, sxsw, austin city limits, etc). The Cold War put tech/aerospace in North Texas and aerospace (NASA) in Houston. Be interesting to see where the new hubs emerge as we dig in against China.
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  #106  
Old Posted Jan 22, 2021, 7:38 PM
Crawford Crawford is offline
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Not sure I'm buying the Houston/Dallas overflow argument. Austin is 200 miles from Dallas and 160 miles from Houston. The metros are nowhere near each other. That's even more implausible than arguing that, say, Baltimore's growth is heavily influenced by NYC.

And I buy the other factors (tech overflow, cheaper, progressive, etc.), though I still feel they don't totally explain why Austin is such an outlier. Austin isn't a typical sunbelt boomer, it's literally doubling in size in a short timeframe. It makes Nashville and Charlotte look like they're stagnant.

I can invent factors for why, say, Cleveland should be booming (liberal metro in conservative, low tax state, Great Lakes freshwater, great bones and infrastructure, uncongested, great tech-oriented university, centrally located, tons of high culture, etc.), but it isn't. I feel some of the reasoning is rationalizing after the fact.
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  #107  
Old Posted Jan 22, 2021, 7:49 PM
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Austin is largely fed by hype; some based on reality, other based on BS. You also have prominent people like Joe Rogan and Elon Musk moving there plus young high tech economy which Houston and Dallas aren't known for.
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  #108  
Old Posted Jan 22, 2021, 7:50 PM
mrnyc mrnyc is offline
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unfortunately ohio is not a low tax state. its 10 or 12 ranked.

cleveland is mostly hurt by state gov, which is highly repub & suburban oriented. they also used to have i think the largest major city council, which hurt it more than helped. thankfully its been shrunk to reasonable over the past decade.
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  #109  
Old Posted Jan 22, 2021, 7:56 PM
mrnyc mrnyc is offline
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Originally Posted by JManc View Post
Austin has always had a cool factor when it was just a big college town. It was the Live Music capital before it had SXSW and was always highly educated between UT and the state bureaucracy and things just coalesced from there. Indianapolis, Birmingham, etc don't have a coolness factor...which does factor in to a degree. People either move to Austin for school (and stay) or move their seeking opportunities and the jobs eventually do follow. I am currently in the job market myself and in my field, Austin is hot while Houston is sluggish and may have to take something in Austin for a while.
and you could say the exact same thing for its northern cousin columbus. now columbus is also growing, but nothing like austin. there is something in the austin water. tech is the driver, with the stage set years ago by dell, but its more than that. its a true boom town. they say austin isnt weird anymore, but this amazing growth certainly is.
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  #110  
Old Posted Jan 22, 2021, 7:57 PM
iheartthed iheartthed is offline
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Originally Posted by bossabreezes View Post
Sure, but is Northern Virginia or Columbus known as a tech hub now at the same level as Austin? No.

Tech companies can and are founded everywhere/anywhere. I'm not talking about that, I'm talking about place with a concentration so high of tech company bases that they are known as major tech hubs, where the dominant industry is tech.

First thing that comes to mind when you think of Austin is tech. First thing that comes to mind when you think of NoVa is government. First thing that comes to mind with Columbus certainly isn't tech. SF= Tech, Seattle = Tech, ect.
A decade ago I wouldn't have really considered Austin to be in the league of SF or Seattle. It was much more analogous to a Columbus, Ohio, or northern Virginia.

Not to sound like a broken record, but the concentration of fast scaling tech companies is a direct result of venture capital. Until recently, the biggest venture capital funds in the world rarely even considered investing in companies that weren't based in Silicon Valley, hence why Facebook moved from Cambridge, MA, to Palo Alto very early. It's called the 20 minute rule. VCs were reluctant to write checks for companies that were located more than 20 minutes from their office.

Even now, the funding model is extremely biased to certain focus cities, of which Austin happens to be one. If you dumped a bunch of venture capital money into Detroit it would become a tech hub overnight.
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  #111  
Old Posted Jan 22, 2021, 8:02 PM
bossabreezes bossabreezes is offline
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Originally Posted by iheartthed View Post
A decade ago I wouldn't have really considered Austin to be in the league of SF or Seattle. It was much more analogous to a Columbus, Ohio, or northern Virginia.
Exactly, so we are actually agreeing on the fact that Austin's growth has made it stand out and become an outlier from the bunch (including the other examples you included.)

Your reasoning all makes sense, and I agree with it. It does not explain why Austin was chosen to be the chosen one of the VC crowd though. This is what I'm trying to get to.

I think it could ultimately be that hype was the catalyst for the growth we're seeing in Austin. Not necessarily a bad thing, but not exactly the most solid reason either.
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  #112  
Old Posted Jan 22, 2021, 8:04 PM
DCReid DCReid is offline
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Here's an interesting site that you can see growth rates of metros over decades - The link is for what i put in for Phoenix since 1950 but you can change the metro (I think there is some way to change the year). I'm not sure how accurate it is, but it is interesting to see the yearly growth rates of metros...

https://www.macrotrends.net/cities/2...nix/population
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  #113  
Old Posted Jan 22, 2021, 8:09 PM
iheartthed iheartthed is offline
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Originally Posted by bossabreezes View Post
Exactly, so we are actually agreeing on the fact that Austin's growth has made it stand out and become an outlier from the bunch (including the other examples you included.)

Your reasoning all makes sense, and I agree with it. It does not explain why Austin was chosen to be the chosen one of the VC crowd though. This is what I'm trying to get to.

I think it could ultimately be that hype was the catalyst for the growth we're seeing in Austin. Not necessarily a bad thing, but not exactly the most solid reason either.
I think the choice of Austin was somewhat arbitrary. It had some basic things like a large university in close proximity, a large enough airport, etc. And being the home of SXSW probably raised awareness of the city among Bay Area elite. But I don't think there's anything unique about Austin that couldn't have been replicated in other places.
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  #114  
Old Posted Jan 22, 2021, 8:10 PM
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Originally Posted by mrnyc View Post
and you could say the exact same thing for its northern cousin columbus. now columbus is also growing, but nothing like austin. there is something in the austin water. tech is the driver, with the stage set years ago by dell, but its more than that. its a true boom town. they say austin isnt weird anymore, but this amazing growth certainly is.
Columbus and Austin remind me more of each other than they do with other cities but Austin has the cool "it" factor Columbus doesn't quite have. I never hear about people wanting to move to Columbus even if they recognize the latter has a lot of offer. Austin is drifting away from charm it had as a big college town with good live music to being a slice of the west coast in Texas.
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  #115  
Old Posted Jan 22, 2021, 8:12 PM
bossabreezes bossabreezes is offline
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Originally Posted by iheartthed View Post
I think the choice of Austin was somewhat arbitrary. It had some basic things like a large university in close proximity, a large enough airport, etc. And being the home of SXSW probably raised awareness of the city among Bay Area elite. But I don't think there's anything unique about Austin that couldn't have been replicated in other places.
1 million percent agree, which is why I started the discussion on why I don't really get Austin
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  #116  
Old Posted Jan 22, 2021, 8:21 PM
mrnyc mrnyc is offline
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Originally Posted by JManc View Post
Columbus and Austin remind me more of each other than they do with other cities but Austin has the cool "it" factor Columbus doesn't quite have. I never hear about people wanting to move to Columbus even if they recognize the latter has a lot of offer. Austin is drifting away from charm it had as a big college town with good live music to being a slice of the west coast in Texas.
sure they do, they are twin cities. or were. i spent a lot of time in both when they were much, much more alike.

yes, you could say sxsw was a better cool factor driver than the columbus short north comfest or the doo dah parade ever was.

and there are at least a few other bigger dividing factors. the austin weather is a draw not a hinderance. and even more so the low texas taxes vs ohio's. and as for tech business comparisons, at the start of austins boom dell had already trumped the earlier columbus compuserve.
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  #117  
Old Posted Jan 22, 2021, 8:24 PM
Omaharocks Omaharocks is offline
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Not to beat a dead horse, but why is Austin white-hot and Louisville totally anonymous?

They have similar scenery, probably slight edge to Louisville. Both are in cheaper, low tax, business friendly states. Both are relatively liberal outliers. Louisville has way better urbanism, Austin is the state capital and its university is better. Louisville has good summers, Austin has good winters.

Also, why is Birmingham stagnant? Too black? Because it's Alabama? Birmingham has nicer scenery and urbanism than Austin. Still a relatively liberal outlier in a deep-red business friendly state with low taxes and minimal regulation. I think I'd rather live in Mountain Brook (the fancy suburb of Birmingham) than in the fancy Austin hill neighborhoods.
I think I can try to answer some of these thoughts. All my family history is in Austin, and I'm now a consultant based in Atlanta that works a fair bit in both Birmingham and Louisville.

For scenery, much of Austin's appeal comes relative to other parts of Texas, but a lot of it is harder to discern without being more intimately familiar with the place. The abundant clear aqua swimming holes with the big live oaks, all the rocky swimmable creeks with attractive college kids swimming mostly (or entirely) naked...it's just a fun place outdoorsy place, even in the scorching hot summers.

Louisville has a riverfront, but otherwise shares non of this appeal. It's attractiveness lies in its beautiful residential neighborhoods, which as you said are urbanistically superior to what you find in Austin, but millennials, and especially techy millennials, will pick trendy and fun over solid urban bones.

Personally, I prefer somewhere like Milwaukee to Austin, and really prefer Milwaukee over Nashville, but I also completely understand why many prefer cities like Austin, and for most of my friends I think Austin is frankly the better choice.

And Birmingham...well I think you need to spend a bit more time in each place. Birmingham is a nice town with very good building stock town downtown and some nice hills, but it's very similar to my hometown of Omaha. It's nothing like Austin, and would feel very culturally conservative by comparison. Birmingham is mostly democratic like most cities, but it's still deeply southern. This is a major barrier to many but especially west-coast based tech companies...Austin is far more approachable with it's breakfast tacos and music festivals.
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  #118  
Old Posted Jan 22, 2021, 8:30 PM
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Originally Posted by Crawford View Post
Not sure I'm buying the Houston/Dallas overflow argument. Austin is 200 miles from Dallas and 160 miles from Houston. The metros are nowhere near each other. That's even more implausible than arguing that, say, Baltimore's growth is heavily influenced by NYC.

And I buy the other factors (tech overflow, cheaper, progressive, etc.), though I still feel they don't totally explain why Austin is such an outlier. Austin isn't a typical sunbelt boomer, it's literally doubling in size in a short timeframe. It makes Nashville and Charlotte look like they're stagnant.

I can invent factors for why, say, Cleveland should be booming (liberal metro in conservative, low tax state, Great Lakes freshwater, great bones and infrastructure, uncongested, great tech-oriented university, centrally located, tons of high culture, etc.), but it isn't. I feel some of the reasoning is rationalizing after the fact.
In the matter of your objection, it could just be a rising tide lifts all boats. It's not that Austin is heavily influenced by Houston and DFW, just part of the equation. Those cities and Texas in general has had momentum building up for the past 3 decades.
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  #119  
Old Posted Jan 22, 2021, 8:32 PM
Obadno Obadno is offline
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The scenery and climate in Austin is lightyears better than Indianapolis.
I was not talking about the climate
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  #120  
Old Posted Jan 22, 2021, 8:46 PM
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Originally Posted by mrnyc View Post
sure they do, they are twin cities. or were. i spent a lot of time in both when they were much, much more alike.

yes, you could say sxsw was a better cool factor driver than the columbus short north comfest or the doo dah parade ever was.

and there are at least a few other bigger dividing factors. the austin weather is a draw not a hinderance. and even more so the low texas taxes vs ohio's. and as for tech business comparisons, at the start of austins boom dell had already trumped the earlier columbus compuserve.
Ironically, SXSW is no longer that cool. It's been sanitized and commercialized to where it no longer resembles its original form but the legacy remains cool and stuff like that continues to add to Austin's appeal. I really wanted to go to SXSW at least one 15-20 years ago but have no interest now. Austin is the Bitcoin of cities and people want in on the action because FOMO.

Austin has a lot of 'cool' employers either already in the area or increasing their presence. I mean who doesn't want to work for Apple, Intel or Google even if they have no chance in hell. Houston has loads of high paying jobs and opportunities but mainly on energy and healthcare which is not as exciting as tech. I can't think of anything like that in Columbus either which seemed to have a lot of health, retail, insurance companies HQ'ed there.

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Originally Posted by TexasPlaya View Post
In the matter of your objection, it could just be a rising tide lifts all boats. It's not that Austin is heavily influenced by Houston and DFW, just part of the equation. Those cities and Texas in general has had momentum building up for the past 3 decades.
The wealthier Houston and Dallas became, the more Austin benefited. It's the state capital of a state that was booming largely because of these two areas plus the flagship university that directly benefits all that oil revenue.
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