Pittsburgh gives birth to tech firms, but can't keep them | Hacker News Reader

Pittsburgh gives birth to tech firms, but can't keep them

post-gazette.com

35 pointsgeorgecmu30 comments

Who cares? Pittsburgh's done a great job in the last decade to work with startup-minded programs like Carnegie Mellon's ETC to build a good foundation to start these ventures. Add that to the great technical talent coming out of Pittsburgh schools and the low cost of living, and it's not a bad start. Lots of other cities would kill to have a vibrant startup culture.

Building the Valley doesn't happen overnight. Having a good startup culture is a great first step to getting the money to follow. It's not easy, it's not a given, but it's a great first step. Not to mention that Pittsburgh's been doing well in the healthcare and finance worlds, too; I wouldn't be surprised if venture capital does start flowing in Pittsburgh in the future.

But going public hasn't been as enticing an option during the recession...Google went public in 2004, a year that saw 218 IPOs. Last year saw 63 initial public offerings of stock -- not exactly a welcoming market.

Any discussion of public offerings that omits Sarbanes-Oxley is incomplete and irresponsible. The decline in IPOs has more to do with SOX compliance than the economy, especially for nimble tech start-ups.

There are many valid reasons for Pittsburgh failing to keep start-ups, but failing to IPO certainly isn't one of them.

I'll be moving to Pittsburgh to attend CMU grad school (interaction design) this fall. I'd never been there before being accepted but overall I've been really impressed with the city every time I visit.

Its a pretty little city sitting between three rivers and each of its many boroughs have their own style and lots of little shops and restaurants to discover. That along with the super cheap cost to live there make it a very compelling place to live once you get to know it.

Its a pretty awesome place -- I'm about to graduate CMU undergrad and I'm not planning on leaving anytime soon. If I do it will probably be out of the country before somewhere else in the states.

Every city wants to be the 'next Silicon Valley' but can never retain the companies. Its not a problem endemic to Pittsburgh. Can you think of a city that's not in the west that can honestly claim this title?

Its not just the capital - there's a sense of entrepreneurial manifest destiny mixed in there that can't be stopped. For a tech company that doesn't have hard assets there's nothing stopping wide-eyed entrepreneurs from picking up & moving west. And lets get honest here - Pittsburgh is great but if you're finally making it to the big time, why would you want to stay in a declining rustbelt city?

Property values are significantly lower in Pittsburgh, which makes property ownership easier. And the top-quality colleges in the city continue to graduate excellent candidates for tech company employment.

Although a graduate can ship out west, the lower costs in Pittsburgh make the path to ownership shorter. I'll be interested to see if the economic downturn will give graduates pause when thinking about shipping themselves three timezones away into an expensive location, when the cheaper prices in Pittsburgh could offer a lifestyle with less debt.

Yea but who graduating college thinks about home ownership?

I left Philadelphia for CA shortly after college 6 yrs ago. I still rent here and I know that if I stayed in PA I would probably own multiple properties at this point. Honestly I would rather rent in California than own a mansion in Pennsylvania. My life is just infinitely better here.

True, but remember that most startup founders are not just graduating college.

I know many graduate students that buy homes during their stay in Pittsburgh rather than renting, and simply sell when they leave. Often, those homes end up in the hands of other graduate students.

I mean I am about to do this (in Cleveland at CWRU instead of Pittsburg at CMU) but the principle of the thing is the same. These cities have some of the lowest costs of living to be found anywhere in the US. I would also note that Cleveland has the same problems mentioned in the article to a degree, but is managing to retain bio-tech firms. This is mainly due to the top notch institutions (hello Cleveland Clinic) which are in the city.

It seems increasingly unlikely that the kind of person who is interested in real estate ownership, for the purposes of living in it, is not the same kind of person who values the flexibility and uncertainty of startup culture, two of the things that are attractive about Silicon Valley and the Bay Area.

> And lets get honest here - Pittsburgh is great but if you're finally making it to the big time, why would you want to stay in a declining rustbelt city?

Luis (the reCAPTCHA founder) wrote a blog post about this recently. Basically to summarize, staying in Pittsburgh helped picking up CMU talent, and Pittsburgh doesn't suffer from a lot of distractions that come with the Valley.

http://vonahn.blogspot.com/2010/06/startups-and-cmu.html

Very importantly to note though, Luis has a professorship, a fiance, and a life built out in Pittsburgh. Similarly, I've heard that a lot of the Google Pittsburgh engineers are family men/women who don't want to leave the area.

Robots. This is going to be the decade of robots. Carnegie Mellon is a world leader, and Pittsburgh should benefit from the boom. Just Google and see what you come up with. I found a few:

http://www.seegrid.com/seegridoffices.html

http://kotaku.com/5577771/intel-inside-your-mind-serving-you... - Intel Lab in Pittsburgh

http://www.pittsburghroboticssociety.org/

An interesting thought from that discussion:

"I agree with you, the resources in the Valley can't be beat. Fortunately there is a way to leverage both - we are trying to pave the way for development in Pittsburgh and business in SV. There are many upsides to this approach - incredible team, dedication, outside the bubble, lower costs, better office space, local recruiting, etc. We are testing this all out at the moment - so far so good!"

> a declining rustbelt city

Your opinions are about 30 years behind reality. Why do you think Obama picked them to host the G20?

Votes? I shouldn't know that Altoona, PA even exists, but thanks to the 2008 campaign season, I do. Swing states get attention.

I know nothing about Pittsburgh, so I'm not suggesting anything negative about the city. There are just plenty of other possible reasons behind the evidence you gave.

I don't think of the G20 as being a marker of endorsement for a city's economic well-being. If anything its akin to putting a big red target mark for chaos & destruction. Pittsburgh may just be well suited to absorbing riots

http://en.wikipedia.org/wiki/2009_G-20_Pittsburgh_summit

the Obama Administration announced a change of venue to Pittsburgh in order to highlight the city's economic recovery following the collapse of its manufacturing sector in the latter half of the 20th century.

I love how I got downvoted to 0 for telling the truth. I think Pittsburgh is great, its one of my favorite places. But, you can substitute Pittsburgh for Cleveland or Philadelphia, or Chicago or St Louis or Baltimore. At the end of the day successful entrepreneurs typically go to where there is the most upwards economic activity.

Pittsburgh also gives birth to people, but can't keep them.

Kind of a good thing, really. Pittsburgh was at what, half a million people in the mid-1900's? It's since been halved. It can't support the same population as during Steel boom era, and shedding so much population gave it a good base to reinvent itself as medical, financial, and educational centers of the region. It's one of the things that Detroit might want to pay heed to.

The other side effect was that since everyone moved across the country, the Steelers are now one of the nation's most popular teams. And everyone knows the best barometer for a city's success is sport teams.

Isn't this true to some extent for every region that's not Silicon Valley?

Paul Graham is from Pittsburgh. If he still has some emotional attachment to the city, perhaps he would be willing to invest in some of the great startups we have here?

"If he still has some emotional attachment to the city..."

Judging from what he has wrote about cities in the past, I'm pretty sure he does not.

Pittsburgh is doing fine. It's a great city to live in. Very attractive, lots of outdoor activities, low housing, a good base of Fortune 500 companies, and unlike our neighbors, we retain our sports celebrities. I am a former New Yorker and have started a handful of companies in Pittsburgh. It's not hard to get to know who you need to get help. I am optimistic about the city long term.

As a native Pittsburgher and startup founder... we've got a great community forming, but it's still in the primordial ooze stage. Lots of user groups, great companies coming out of AlphaLab and other incubators, and an awesome, tight-knit community.

What we do have is a big problem with talent. I know of at least five or six companies that are hiring, but they just can't find qualified people. It's exactly what the article talks about; ModCloth for example pretty much has to go to the valley to find all that top talent. It's sad but true. Everyone wants to move to the valley, but nobody wants to move here.

I wonder how much of a talent drain Google has been? I know several folks there, and apparently they have been hiring steadily over the last year or so.

EDIT: I think the demographics have something to do with it. As another commenter pointed out, there are tons of young families here, and I suspect that these folks are more than happy to find a good job and stay there, rather than live the start-up life. Granted, the talent pool is smaller than, say, Silicon Valley, but that's not say the area is mostly devoid of good talent. Much of the talent may simply want to stay put.

Sort of a vicious cycle I guess. I don't think I'm the only coder that's sick of the crowding and high prices and completely out of reach real estate out here. I've considered a move to PA but from what I can tell the job market is about 1/100th what it is in CA, so that's putting a lot of eggs in one basket.

If you know Rails, and you're a good programmer, you could easily pick between a few jobs here.

Just saying.

After having lived on the coast for a while, I can say that people are not on average that much smarter or hard working there than in a number of other places. They might be a little bit, but that's because of the "brain drain to the coasts" phenomenon rather than anything intrinsic.

I can summarize the advantage of the coasts in three words:

Access. To. Capital.

Social networking effects come in a close (and related) second. Tech companies are in Silicon Valley because tech companies are in Silicon Valley.

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