First, yes, yes there is something magic about SF's geography, it's the closest major city to the largest VC hub in the world. These companies thrive on young talent that prefers to live in a city. It's not dissimilar to the gold rush 170 years ago when you think about it.
Second, what do you mean "San Francisco is just not suitable any more"? The tech companies and their employees are the least impacted by rising housing costs. By and large they are doing alright, so what is their incentive to uproot everything and randomly go roll the dice somewhere else which would A) not have a critical mass of VC in their backyard and B) will offer no guarantee of not reacting exactly the same as SF.
Keep in mind, 20 years ago there was barely any tech in San Francisco proper. Sure there tech employees who chose to live there and suffer the commute to the peninsula, as is their prerogative being free individuals residing in the US. The reason tech moved in was because SF offered tax breaks—they wanted their piece of the tax revenue and daily spending from well-to-do tech workers. If the city really felt tech being there was the problem they have a lot of levers (eg. raise taxes, zoning changes, etc) to push it out. Of course they don't want to do that because it would cause far more economic harm than good. NIMBYs are of course willing to entertain the charade of successful tech companies as the scapegoat because it keeps their home values sky high while deflecting to the amorphous "tech companies", who in fact they have zero control over policy and at best marginal interest in addressing the issue at all.
haha fair enough, closest cute major city : ) As a longtime South Bay resident, it's super-boring down here and actually many of the same problems, expensive and lots of homeless.
But all of that is beside the point. The real interesting question is whether the companies will yank the leash Musk-style and have everyone come back here, or not. There is a lot of hype in both directions, but I'd say that debate is not settled yet.
All this talk of "just relax zoning and build housing" is so simplistic that it's actually kinda cute. As if everything else just multiplies accordingly-- streets widen, schools are built, water/power/etc just magically appear whenever residential units are simply permitted.
Just FYI, San Jose is bigger than San Francisco in terms of population and square miles.
That's not to say that SF might not be more of a major city than SJ, in fact I would say that personally I think it is in terms of culture and history and social impact, but it's at least debatable.
I think SJ vs SF distinction is not very material to this thread. The OG Silicon Valley of HP and Fairchild Semiconductor fame liked to build corporate campuses around Stanford on cheap (at the time) land. 90's Yahoo, Doubleclick, Google followed suit. In the late 2000's, a new wave of startups like Twitter figured they don't have to stick to corporate code and just move up to a more fun city up north, combined with some tax breaks from SF specifically. How does it matter? It's the same area (i drive up and down every day) with much the same problems.
Both tech and VC are vastly more mobile than anything to do with the gold rush or even other 'technology' sectors with heavy physical assets, it's purely a coordination game.
I think having both in high concentrations is mutually beneficial. The same goes for tech workers: having thousands of potential employers within commute distance without having to move is great.
That's what I meant by coordination game: it could be any place, but they should all (well, sufficiently many) be in the same place. That's why there's a lot of staying power once a place has achieved that status (fyi, in game theory that's called a correlated equilibrium [0]).
First, yes, yes there is something magic about SF's geography, it's the closest major city to the largest VC hub in the world. These companies thrive on young talent that prefers to live in a city. It's not dissimilar to the gold rush 170 years ago when you think about it.
Second, what do you mean "San Francisco is just not suitable any more"? The tech companies and their employees are the least impacted by rising housing costs. By and large they are doing alright, so what is their incentive to uproot everything and randomly go roll the dice somewhere else which would A) not have a critical mass of VC in their backyard and B) will offer no guarantee of not reacting exactly the same as SF.
Keep in mind, 20 years ago there was barely any tech in San Francisco proper. Sure there tech employees who chose to live there and suffer the commute to the peninsula, as is their prerogative being free individuals residing in the US. The reason tech moved in was because SF offered tax breaks—they wanted their piece of the tax revenue and daily spending from well-to-do tech workers. If the city really felt tech being there was the problem they have a lot of levers (eg. raise taxes, zoning changes, etc) to push it out. Of course they don't want to do that because it would cause far more economic harm than good. NIMBYs are of course willing to entertain the charade of successful tech companies as the scapegoat because it keeps their home values sky high while deflecting to the amorphous "tech companies", who in fact they have zero control over policy and at best marginal interest in addressing the issue at all.