Why I’m leaving Silicon Valley | Hacker News Reader

Why I’m leaving Silicon Valley

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For most people, moving to Silicon Valley will simply accelerate their personal financial ruin. For most people, buying, owning and then selling their home is the accepted and straightforward path to financial independence. The common case now is to rent perpetually at very high rates. Most of these people will end up much worse off than someone in a podunk uncool city who was able to buy a home.

If you are here and do not see a clear path to financial independence within five years, leave. If you turn forty and are still renting your primary residence out of necessity, leave.

I am also thinking about these issues such as career growth vs. buying a home. Can you tell me why buying a home when working is so important? What about saving money and buying home when you are close to retirement?

No bank is going to hand out a first-time mortgage to someone when they are fifty-five.

Lots of people think they will pile up the savings while they rent. But life happens and they want to live somewhere nice in the present, so they end up making their landlord rich and no one else.

I am almost fifty. I now see life from the perspective of approaching retirement. At this point, if I were renting, I would be in deep trouble.

And forget this idea that you love your job and will just keep coding/growth hacking/whatever until you are seventy five...no one will want you around the office. This is just a myth people are constructing for themselves.

>For most people, buying, owning and then selling their home is the accepted and straightforward path to financial independence.

This commonly held wisdom seems to be a holdover from the pre-2008 days, and I wonder how much longer it will last.

http://www.businessinsider.com/map-of-us-housing-market-grow...

Unless you're buying property in a coastal city, odds are good that your home value will, at best, stay the same year over year. If you buy a house in flyover country it might actually depreciate.

Add to that the costs of a mortgage, property taxes, repairs, buying/selling fees and home ownership seems like one of the worst possible investments to me.

You can rationalize it however you want, you can find data to support any position....but you will one day be sixty seven and you better have a plan.

In any case, I bought in 2010 (not my first home) and so far the assessed value has doubled. Even if there is a housing "crash", I will probably lose only about 25% off that. By 2030, recessions or not, it will have probably gone up 4x. I'm not trying to rub it in your face, I'm merely suggesting this is still a great way to retire and you probably don't have a better plan.

Levi Strauss built an empire selling clothes to gold miners, most of whom would end up in ruin. Many many people in SV have made fortunes housing the equivalent of today's gold miners.

From 1968 to 2004 the average home value in the US had an average 6.4% YoY growth[1]. An index fund will grow your money much faster than that, all without saddling yourself with debt or exposing you to the risks of the housing market, both as a whole and in your area.

You were lucky to buy your house at the bottom of the 2008 housing crash, it doesn't mean that houses are a good investment today.

[1] https://www.investopedia.com/articles/mortages-real-estate/1...

I can easily borrow against my home equity. I cannot easily borrow against my index funds. Home equity also delivers an almost-fixed tax rate in California (prop 13) and numerous other deductions and incentives, none of which stock investments provide.

Home equity is much more powerful than a fund investment, they are not equals.

That is simplistic and doesn't account for the ability to get loans (investing more money than you have), tax breaks, and the fact that you need to live somewhere in the first place. Buying a house with cash and not living in it is probably a very poor investment, but that isn't what you are comparing.

What are the returns on renting?? Because that is where your money will go if you don't buy. If I forgo a house, I save $1500/month on a mortgage, but now I have a new expense called rent, I can't allocate it to investing.

> "this is still a great way to retire"

what is? having a home that's appreciated 4x over decades to liquidate or having locked in a home to live in?

You coulda also buy Bitcoin 2 years ago, and get way more than that.

You kinda live in the past homie... Is not 2008 anymore.

I don't understand this argument. Let's put some numbers up:

Single: income starting at $130k a year. That's 7k/month after tax. Rent a room in SV for $1000 (or Berkeley), and spends $1000/month. That's still $5k/month in savings. If you're senior, that number goes up to $200k a year. That's $11,500. That turns into $9500/month in savings.

Couple: 2 income at combined $260k a year. that's $14k/month after tax. Rents a house in SV or berkeley at $3000/month. Spends $2000/month. That's $9000/month in savings.

etc

find me the room for $1k/month. find me that home for $3k/month. oh and be sure to lock in those rates for five years

ok let's say you were lucky enough to find a $1k room in a neighborhood not littered with gangs, bullets and drugs...

okay, now get married. where will you live?

okay, now your wife is pregnant, what now?

is success to you renting a bedroom in an apartment with three people when you are forty five?

Try using craigslist; there are many many rooms in SV for $1k/month. and many standalone house for $3k/month.

Different strategies work for people in different situations. Renting cheaply and saving while single has worked for some people. If the situation changes, you'll have the down payment (and then some) to buy a house somewhere when it's time to make a change.

Maybe not in Silicon Valley. Or maybe the housing bubble will be over by then? There's no crystal ball.

This article reads like a self-promotional, self-important fluff piece. Leaving all the congratulatory of her own career aside, she decides on blockchain and decides on LA.....not New York or Singapore or places that actually have alot of financial expertises she can learn.

> going onto to doing bigger and harder thing

Tell yourself the truth; you're afraid of the intense competition in SV. You're going to LA for the weather, and live an easy life. There's no tech in LA except the big tech companies.

LA is cheaper than NYC or Singapore while still having big city amenities and a decent peer/talent pool. In her shoes I would keep on going and land somewhere in the OC...even cheaper but close enough to a metropolitan area to keep her connected to her contemporaries.

...Intense competition with little real reward other than being able to tell people that you work in SV. While you may make 150,000, you can barely afford one room in a shared house. But, you DO work in SV so, there's that. If one wants to work in tech, there are a ton of places one can do so. I know that SV holds this position of tech nirvana in the minds of nerds (said affectionately, not as a pejorative)... but some folks really do enjoy having tangible real rewards for their hard work.

I don't get her point. She is moving out since she realized Silicon Valley is not the epicenter of tech? And her reasons on why LA are weak still (proximity to SV, weather & hustle culture). I would have understood if she wanted to move to another country to immerse herself into new culture and gain more exposure but this seems like a copout. Unless she is planning to work in non-tech space in LA, why is she expecting that techies in LA based companies would be much different than SV (especially in companies like Snapchat, Google etc. which she is quoting)?

I don't think she's exited the groupthink of SV as much as she claims.

The 'block chain revolution'? Revolution? Really? Can anyone tell me about the blockchain tech they are using that makes a noticeable difference in their lives?

Also - what's with the massive glam spread glossy photo shot?

If anything, a big, professional magazine style selfie for a Medium post, combined with the very self-oriented (i.e. it's mostly about me) narrative is more evidence of the symptoms of the Valley than anything.

Revolution: noun. Something that makes a noticeable difference in people's lives.

Is not the definition of a revolution.

This is Revolution: noun. a forcible overthrow of a government or social order in favor of a new system.

That's exactly what Blockchain technologies are doing to fiat currencies. Don't you see it? Or you're one of the idiots here that are missing out. Don't fall into collective thinking (like OP says).

" Don't you see it? Or you're one of the idiots here that are missing out."

Ha ha ... ha ha ... yes, I'll use those BTC to buy ... what exactly? Nothing?

It's ok to be naive and dumb on YC, we're just not allowed to call other people names.

I use https://www.shiftpayments.com/ I buy everything with BTC

1 year at Goldman Sachs and then PARTNER at Anderseen Horrowitz, basically 1 year out of school?

What?

I don't think there's the full story here.

This is really strange LinkedIn history:

https://www.linkedin.com/in/preethi-kasireddy-41383528/

Also - less than two years coding experience ... it's going to be hard. Surely she's very smart so hey ...

It's just an associate role, basically being the first line of defense against people wasting the firm's time.

I suspect many firms call them "partners" these cays to prevent companies from not going to meetings once they realize they're only being put in front of an associate with no actual decision making power.

I agree with your logic, much like a lot of private wealth managers being 'VPs'.

But still, there are actually 'Associates' there :)

Partner usually not until a few years and maybe an MBA.

I might be missing something big but who is the author, and why would anyone care why she is moving? Is she a tech celebrity or something? Not sure how the personal story of some rando techie got the up-votes it did but hey, odder stuff has made it to the front page...

maybe the blog post is a clever way to get people to offer to help pack and load the truck

Nice story telling -- my question is around the transition from banking --> VC --> engineer. If you had your time over would you still follow the same path? Was the finance side of business so complex that you needed to be in the "tick of it" for so long?

I went from engineer -> producer/pm -> engineer. It almost seemed like I could physically feel my programming skills atrophy during my time as a producer and it was driving me nuts at the time.

I'm starting to think I should have just stuck with it. I'd probably be making a lot more money now, and I would have dealt with a lot less bullshit.

Reminds me of this post by Fred Wilson: http://avc.com/2015/06/loyalists-vs-mercenaries/

Summary: Starting a tech company outside SV is better in the sense that engineers aren't there solely for the money, but have other motivations such as the mission of the company or growing in the city that they'll be happy. Therefore companies outside SV have less labor rotation.

Yup. Along the lines of one of Friedman’s book, the world is flatter thanks to the internet and global transport.

Fantastic example of contemporary entrepreneurial life: come to the hub to get exposure: build your network, increase your value, and understand what motivates and drives your passion, then move on because there are easier places to truly take root than SF.

SF doesn't offer the density of New York City, or the exposure to creative/media infrastructure of LA. What any of these blockchain currencies lack right now is mainstream appeal, LA would be fantastic for building that once she's got the tech right.

Her bio drops a strong hint:

>I have a passion for understanding things at a fundamental level and sharing it as clearly as possible.

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