California-and the L.A. area especially-keeps losing corporate headquarters--WHY?

[mhays]

I have a feeling the volume of Seattle companies opening/expanding SF offices is a small fraction of the reverse....of course SF tech is bigger so that might be expected, but also the pull of SF talent/access is an increasingly tough sell given the cost.

[Pedestrian]

Originally Posted by mhays

I have a feeling the volume of Seattle companies opening/expanding SF offices is a small fraction of the reverse....of course SF tech is bigger so that might be expected, but also the pull of SF talent/access is an increasingly tough sell given the cost.

You are entitled to your feelings but the question that occurred to me was, "Why are they even doing this?". I certainly can understand Bay Area companies with Silicon Valley headquarters like Google and Facebook setting up satellite offices in SF because so many of their employees--and people they'd like to hire--want to live in SF and hate the long commute down the Peninsula, but why does a Seattle company need an SF office at all (and the 2 biggest--Microsoft and Amazon have them)? The Bay Area must offer something they don't think they can get in Seattle. I'm not sure myself what that may be, especially since companies like these are way past needing venture capital.

[mhays]

I'm referring to SF as the whole metro BTW. But to answer your question, typical reasons tend to include these (speaking generally, not about these companies specifically):

1. Ability to recruit talent who won't leave SF or want to locate there.

2. Access to companies these companies have relationships with.

3. New centralized homes for local firms the big company has purchased.

[YSL]

Originally Posted by the urban politician

California is crowded because of immigration.

It's a huge exporter of domestic people, and a huge importer of international people

So..in other words, California is crowded because people move there. i'm not sure why some think domestic is somehow better or important than international migration. a migrant is a migrant.

The places w/ the biggest domestic migration remain the most all low-skilled, low-wage parts of the U.S., while the places with the most international migration are becoming better off, generally..

I'd prefer more international migration than more domestic migration since all of the top cities in the U.S.A. are international cities.

Houston (like most major cities) also has negative domestic migration now. Growing because of international migration & the crazy high birth rate.

[mhays]

Amen to that. All the best places have high immigration. And many of our industries rely on it, starting with STEM fields where the US doesn't have enough grads in the right fields.

[dimondpark]

Originally Posted by Pedestrian

And then there are the corporate headquarters arriving and/or springing up.


http://www.sfgate.com/news/article/W...photo-12102170

Why didn't they do what they did in Ireland which is having it's own tech boom or sorts? I don't know but I'm betting they can give you good reasons and those reasons would probably be why I'm not worried about California.

Actual innovators flock to Silicon Valley from all over. While other places have tech success stories, really nowhere in the world has the ecosystem in place that incubates start ups like the Bay Area-access to capital here is really unparalleled.

[Pedestrian]

I hate to feed the trolls but:

Here’s why people plan on leaving San Francisco

Open thread: Do you plan on leaving San Francisco?

Bay Area population growth slows, some counties losing people

[dimondpark]

Originally Posted by Pedestrian

I hate to feed the trolls but:

Here’s why people plan on leaving San Francisco

Open thread: Do you plan on leaving San Francisco?

Bay Area population growth slows, some counties losing people

This is not new. Everytime the economy gets overheated people leave. Off the top of my head I count 4 recessions that battered the local job market in the past 20 years.

And cost of housing is by far the main reason people leave which is understandable. Our local municipalities are extremely shortsighted when it comes to addressing the region's housing needs...we are getting what we deserve there!

But the point of innovation is not to always be booming, but to be resilient during busts and that's something Silicon Valley does better than anywhere else.

[Leo the Dog]

LA could potentially lose SNAP in the future as it grows. Snap could become the next FB, or it could flounder like TWTR it's somewhat of a coin toss as where they fall this early in their evolution. If Snap were to grow into a FB-like company and move out of the city of LA that would be big loss.

Where else would you have locals stage a protest to a successful, locally grown, job producing company that has the potential to employ thousands? Venice of course.

I spend quite a bit of time in Venice/MdR and the locals are up in arms about "Silicon Beach" pricing them out and changing the neighborhood. Snap is just the latest, greatest "trending" thing to be against.

[LA21st]

Sigh.

It could. And Netflix could move their headquarters down to LA, where it belongs. I can see that happening at some point, as it's constantly expanding it's LA offices. It's going to rival studios in the near future, so don't be surprised if it moves. When Lionsgate got big enough, it moved from Vancouver to Santa Monica.

If you want to talk "ifs" I can see the same thing happening for youtube, as many of their "stars" live/are based in LA.

[DJM19]

Originally Posted by Leo the Dog

LA could potentially lose SNAP in the future as it grows. Snap could become the next FB, or it could flounder like TWTR it's somewhat of a coin toss as where they fall this early in their evolution. If Snap were to grow into a FB-like company and move out of the city of LA that would be big loss.

Where else would you have locals stage a protest to a successful, locally grown, job producing company that has the potential to employ thousands? Venice of course.

I spend quite a bit of time in Venice/MdR and the locals are up in arms about "Silicon Beach" pricing them out and changing the neighborhood. Snap is just the latest, greatest "trending" thing to be against.

SNAP will most likely stay in LA. There are plenty of areas in the city they could locate and not draw ire. I kind of sympathize with the protestors because SNAP is buying up a lot of little properties and pushing out small time operations. They could easily locate in Playa Vista, Santa Monica, Downtown, Hollywood, etc. Nobody would bat an eye at that.

[LA21st]

Originally Posted by DJM19

SNAP will most likely stay in LA. There are plenty of areas in the city they could locate and not draw ire. I kind of sympathize with the protestors because SNAP is buying up a lot of little properties and pushing out small time operations. They could easily locate in Playa Vista, Santa Monica, Downtown, Hollywood, etc. Nobody would bat an eye at that.

Yup.

[Quixote]

Commercial space constraints, not disgruntled NIMBYs, are more likely to push Snap out of its Venice base. If that happens, they'd likely just move to Santa Monica or farther south to El Segundo, where there's much greater inventory at much cheaper prices.

[ChargerCarl]

Originally Posted by Quixote

Commercial space constraints, not disgruntled NIMBYs, are more likely to push Snap out of its Venice base. If that happens, they'd likely just move to Santa Monica or farther south to El Segundo, where there's much greater inventory at much cheaper prices.

Aren't NIMBYs the ones responsible for commercial space constraints though?

[Quixote]

Originally Posted by ChargerCarl

Aren't NIMBYs the ones responsible for commercial space constraints though?

True, but by "disgruntled NIMBYs" I meant angry protesters.

If a large new office complex were proposed anywhere in that neighborhood, you best believe that the residents would throw a hissy fit. But that's a moot point, as there really isn't any room in Venice to build new office space.

I think El Segundo, with its proximity to LAX and it being just down Lincoln, would be a very attractive option should Snap outgrow its Venice digs.

[mhays]

Companies like that want urban neighborhoods to attract talent. But agreed...lots of options for that.

[Shawn]

As someone on the inside, I can tell you that SNAP will go the way of Zynga, albeit for different reasons: SNAP stock will be a couple bucks in two years, max.

Why? Because SNAP is a one-product company, and that product's value props have been co-opted by brands with bigger user bases and much stronger financial foundations. And more to the point, Snapchat sucks as an ad delivery vehicle. It's not brand safe, and the F500s with proper advertising budgets won't spend with SNAP the same way they spend with Facebook and Google.

So you have a single-product company, with an undifferentiated product and a daily user base which has matured to slow growth / flat growth, and no real way of monetizing said users. They can live off their IPO funding for a while, but without a self-sustaining business model, they have a definitive shelf life.

[Pedestrian]

Originally Posted by Shawn

As someone on the inside, I can tell you that SNAP will go the way of Zynga, albeit for different reasons: SNAP stock will be a couple bucks in two years, max.

Why? Because SNAP is a one-product company . . . .

Your analysis is pretty consistent with what's being said in the financial world also among people who recommended the IPO is a flip only (i.e., if you can get IPO shares take them and sell on the first day pop).

Another factor which you sort of allude to is that there are few barriers to the entry of competition and one competitior (Instagram) with huge resources seems to be gunning for them: Mark Zuckerberg.

And I'm not sure it will take 2 years--the stock could be well below the IPO price by fall.

[Pedestrian]

Originally Posted by dimondpark

This is not new. Everytime the economy gets overheated people leave. Off the top of my head I count 4 recessions that battered the local job market in the past 20 years.

I go back 35 years and, of course, you are right. The dot-com collapse was the most classic because it hit the local tech economy most directly and the effect on real estate was exactly what you'd expect: You couldn't give away inexpensively constructed infill lofts (so-called "Richmond Specials" because of the infamous small time local builders most of whom previously focused on that neighborhood) in SOMA while better quality properties in other parts of town held up better.

[TexasPlaya]

Originally Posted by Quixote

True, but by "disgruntled NIMBYs" I meant angry protesters.

If a large new office complex were proposed anywhere in that neighborhood, you best believe that the residents would throw a hissy fit. But that's a moot point, as there really isn't any room in Venice to build new office space.

I think El Segundo, with its proximity to LAX and it being just down Lincoln, would be a very attractive option should Snap outgrow its Venice digs.

There's always room, that's the thing. At what "cost" depends on who you ask.