It's a new day, and there's a new, ludicrous headline about the state of affairs in Silicon Valley. This time, CBS5-TV reports that administrators at UC Santa Cruz are encouraging staff to take in students because many students can't afford local rent costs.
Previously, the university had faced criticism for not admitting enough students--so it expanded admissions. Now, thousands of new students are struggling to find somewhere to live.
The cost of living in Santa Cruz has gone up in recent years, partly because of all the entrepreneurs and tech workers who have moved in. It's more affordable but still close to the Valley, as long as you don't mind an occasionally horrific traffic-filled commute.
Hopelessness has set in for someone like me. I call it "hopelessness fatigue." Yes, the cost of living is high. But there's nothing I can do, so I'd better make the best of it.
I'll get through another conversation with an entrepreneur who's fed up and leaving. They've packed up and are saying goodbye to Palo Alto, San Francisco, or Mountain View. They're going to Austin, Denver, or Los Angeles.
I'll grit my way through another fill-up at the gas station for $4.08 per gallon. A colleague is in town, which means another dinner at a restaurant that charges $20 an appetizer and $25 an entree. My inner monologue says that if I just move to Reno or Sacramento, I could live so much more comfortably. If I leave San Francisco, though, there's no way I'll ever afford to live in my hometown again.
Running a business amid this lack of hope for affordability is draining, but that seems to be a part of life here now. I like to think it's offset by the cultural events, the enviable weather, the diversity, and the beauty of the surrounding region. But we're living so quickly that it can be hard to enjoy those things.
The Entrepreneurial Question
When I grew up in Bay Area in the '80s, there were about 4.5 million people here. We were diverse, but far away from the country's cultural and governmental centers like New York, Washington D.C., and Los Angeles.
Now there's more than seven million people here. We're joined at the hip to those cities. You can argue the Bay Area wields as much influence as they do. Silicon Valley is a huge reason why. For decades, it's been the primary place to go if you want funding and talent to build a team.
This is changing, but slowly. Entrepreneurs are now starting to see that they can make it work in other regions and cities. I'm reminded of one of my former colleagues, who helped found a tokenized assets company. He moved to Las Vegas when he determined it would enable him to retire 10 years earlier--even after buying three homes there.
And who could forget Peter Thiel, the billionaire venture capitalist who moved his home base to Los Angeles earlier this year? High cost of living and Silicon Valley "groupthink" were among his publicly listed reasons.
This outflow seems significant, but is it really? Entrepreneurs and tech workers are still arriving at a faster pace than they're leaving. Do a search on the populations of San Francisco and San Jose and you'll find they're only growing.
The Bay Area is probably just as vital and relevant to the success of startups in this U.S. as it ever was.
There's no doubt that this place is hard on the nervous system, though. Thousands of us ask: Why should I put up with a cramped apartment here when I can start a mortgage near downtown Austin with the same money and relax on a front porch?
That thought becomes a lot more attractive when you consider how viable entrepreneurship has become outside Silicon Valley. Heck, the fastest-growing private company in America right now is based in Madison, Wisconsin.
Even a lifelong Bay Area resident like me is starting to see the validity in the question.