Can Technology Redefine Detroit? | Hacker News Reader

Can Technology Redefine Detroit?

growdetroit.com

29 pointsBallinBige55 comments

I moved back to Ann Arbor from NYC about six months ago. I think I had to move to New York to see how truly awesome things are here. There is a lot top notch technical talent, the cost of living is low, and abundant cheap space makes it a startup's dream. The quality of life in Ann Arbor is very good, particularly if you want to start a family. To be honest a lot of the really talented people I met in NYC were midwest ex-pats looking for work.

Our start-up is banking on the notion that things are coming full circle for technology, and that we'll see a shift from consumer facing web-applications to physical hardware. Lately it seems that the New York Times agrees:

http://mobile.nytimes.com/2012/08/26/technology/silicon-vall...

http://www.nytimes.com/2012/08/19/business/new-wave-of-adept...

Hi K, I remember your name from previous threads on this topic. Would love to meet you in Ann Arbor for coffee and learn more about what ya'll are working on.

I grew up in Detroit when it was at its peak, then I watched it crash and burn. Though I live outstate I've been in Detroit at least monthly for the past two years and am convinced that I am witnessing its rebirth.

Detroit is like a startup there is huge opportunity with a capital O along with huge risk. As a result Detroit has become a magnet for ambitious young people.

The city's despair has made it open to bold ideas where you'd never get a hearing anywhere else.

Want to start a farm? The city will sell you the land and even tear the buildings down for you.

Want to own a skyscraper? Detroit has over fifty for sale and according to the Wall Street Journal they're at the lowest prices anywhere in the world.

http://www.dailywealth.com/952/The-Cheapest-Skyscrapers-In-T...

I've been thinking about this quite a bit lately. I live in Ann Arbor (about an hour west of Detroit) and the area does seem primed for a revolution. I think it will take a handful of well-known people to say "this is the next spot" for everything to explode. Hopefully this conf is the start of that.

One, thanks for reading (and whoever posted, thank you). I agree with you, personally I think it's a combination of needing more local success stories, as well as recognition by the Nat'l Startup community that we have something to bring to the dance.

Folks like Steve Blank seem to be taking note of the region's efforts. We hosted him last month and his investment into the Michigan eLab (Venture Fund) in your neck of the woods (Ann Arbor) seems to be a strong indicator that something is here...

I've been trying to get Detroit recognized as a start-up success story [1] for a few months here on HN. For those living in Detroit, the turn-around might be hard to see. I live in West Michigan, and in the past decade I've noticed a huge change in the Detroit area. I only visit Detroit a couple times per year, but every time I come by there's something new that surprises me. In the last few years, I've even taken to parking and walking some streets that I wouldn't have previously.

I could even see myself taking employment in Detroit; maybe not today, maybe not tomorrow, but the city is getting there. Mitt Romney might have famously called to let Detroit go bankrupt, but all it really needed was some investors who cared enough to force a paradigm shift. Look at Detroit startups such as Neowin, Fathead, Stardock, etc.

[1] https://news.ycombinator.com/item?id=3923825

"Mitt Romney might have famously called to let Detroit go bankrupt, but all it really needed was some investors who cared enough to force a paradigm shift."

Those two things are unrelated. Bankruptcy doesn't mean the city physically disappears or anything. The reason one declares bankruptcy is to clear debts (in a fairly drastic way), which opens capital up to do things other than service debt. It may yet be a necessary or desirable step.

You're right, Detroit hasn't avoided bankruptcy yet. Like you said, though, bankruptcy is drastic and has consequences. It could be possible to rebuild without suffering that blow and without a bailout.

Impressive. I wasn't aware of his visit, wish I could have made it out. What's a good way to get in touch with you? I'd love to have a more formal discussion about where you see the area going and if there's any way I can participate.

Would be great to chat over a coffee. alex@growdetroit.com Here's a nice highlight of the event (and a snapshot of Steve and I):

http://www.xconomy.com/detroit/2012/07/18/steve-blank-on-det...

I think one or two big time tech company campuses would make a world of difference in downtown Detroit. Open a big dev shop, recruit underpaid people from local companies and best and brightest from Big 10 schools. Just please, don't feel obligated to focus on automotive customers just because you're in Detroit.

That's another interesting topic of discussion though!

It's funny that national media (and even our local newspapers here in Detroit) tend to write-off the American autos as out of touch. Not discounting this sentiment, but they are making moves...

The Ford family have been investing in auto tech like P2P car-sharing (Wheelz) via the investment fund, Fontinalis Partners. Meanwhile, GM Ventures is investing resources into startups like RelayRides.

what will make more difference is grocery stores and other amenities people need to live in an area. tech campuses that bring people to work, then drive back to the suburbs... not enough to build sustainable changes. everything will be at the whim of the people deciding to place businesses there (for charitable reasons, or other), instead of any locals having any say or needs to fulfill.

Agreed, but you're missing an important point. An influx of workers who move into the community will ultimately yield an increase in grocery stores and amenities.

Companies like Quicken (mentioned in the article) provide significant incentives to get their 4k+ employees to relocate downtown. And it's working...

i've worked at quickenloans, have lived in the metro detroit area, and have worked in downtown detroit. It needs more lifestyle infrastructure than one or two companies can provide incentives for.

The state needs to take over the city, incent multiple neighborhood businesses (grocery stores, shopping malls, etc) to be relocating within a moderate radius of the downtown area, and incent families to move there (tax breaks, land redistribution, etc). Pull eminent domain on dozens of square miles of abandoned houses, relocate people if necessary, etc. Businesses grow around people, but people have way too many choices as to where to live. If Detroit is going to even moderately survive again, drastic action needs to be taken on multiple fronts - legal/govt, individuals and private businesses.

I applaud the steps QL and others have taken, but it tends to be not enough - Compuware 15(?) years ago moved there and it didn't do much, for example.

Upvoted :) You nailed it, couldn't agree more.

How is the dev life over at QL? They keep calling and trying to get me to come in for an interview, but I haven't had the time to really consider it having just gotten in at ciber in Southfield a few months back.

I worked with people at a company in Lansing (TechSmith) that worked at Quicken Loans. They were NOT disappointed with their move.

I've heard both sides of the argument.

For me it was mixed, but it was 8 years ago. mgkimsal@gmail.com if you want more details - not comfortable posting publicly.

I also have worked for QL, and there are actually very few of the workers that live downtown. Most commute from the 'burbs. I considered it and did a lot of research and here were my thoughts:

-The income tax needs to go. 2.5% to live in a city with pretty bad crime and no amenities? No thanks.

-Car insurance is through the roof. If you park on the street it's assumed your car will get broken into occasionally.

-I don't feel entirely safe. If I were to walk home from a bar at 2:30am I would be concerned. 20 miles away in any direction and I wouldn't think twice about it (I'm a young guy and I will not drink and drive, so this is a legitimate issue)

-It's actually quite expensive considering the above. A "nice" apartment in a decent part of downtown will cost $1k+/mo. Go to Plymouth, Northville, Royal Oak (high demand, up-scale areas nearby), and you'll be able to get a reasonable apartment for this same price, sans all the above issues.

I really hope it turns around, but my realistic side is a little worried.

You could probably get a decent apartment for at least 20% less plus not as much crime, plus more amenities around town (whether walking or driving).

All good points. I sometimes think it would make more sense for companies to skip Detroit and just open an office in Royal Oak or Ferndale. I would work there in a heartbeat.

Ferndale, Royal Oak, Birmingham (anything on woodward north of Detroit) are great places to live/work

Ferndale and Royal Oak don't really have white collar office jobs.

At any rate. The state of Detroit is extremely Depressing. It's the region's major city!

This is just not correct -- plenty of white collar jobs in Royal Oak. There are an abundance of creative/web design shops within downtown Royal Oak area itself.

not true at all... Just last week I saw a sign for WambaTech being put up in downtown Royal Oak - http://www.wambatech.com

Municipal income taxes is one of those things I've never understood about the United States. If the city is highly desirable, like NYC, or even San Francisco, then sure, it might make sense. It does seem like quite an absurd premium for a city like Detroit.

Municipal taxes pay for police. You can't simultaneously propose to eliminate tax and decrease crime.

It's true that my living in Detroit will help provide the police with more money, which may in turn make more people in the city, which may bolster the police even more... etc. However, I think it's quite a gamble. What if I buy property and the area does not improve? Who will buy it off me if things maintain or go south further?

All of the "nicer" areas that I mentioned in my previous post have very low crime rates and no municipal tax. To add to the previous issues I had, Detroit is poorly run. There have been quite a few cases of corruption of city officials.

It's just another thing that needs to be wrangled in.

You're right, the grocery store problem needs to be solved in order for it to make sense for most companies to do business there. But major software companies like Google and Facebook can bypass it by building their own amenities for employees. These companies tend to do this even if the local area has amenities.

so the big benefit to detroit is that a company moves in, has people drive to it, then work and eat in that building, then drive home? it's not enough. when the city wants to start taxing them (after maybe a 5 year amnesty), if the company doesn't like it, they'll move across the street to another zone with no taxes (a la walmart).

There needs to be more in a city for people to do than to work and eat office lunches. Grocery stores are a visible indicator of how many people make their home (families, kids, long term commitment to the area, etc) there, and Detroit has very few serving 700,000 people. Getting commitment from larger chains, as well as tax incentives to help the smaller mom-and-pops expand to serve more areas - both of these will serve to help attract more people - and this goes for dry cleaners, accountants, and other service businesses.

There is a "grocery store" myth related to Detroit, and it is just that, a myth. There a numerous markets and stores in Midtown and Downtown that supply fresh food to residents.

Edit: I lived downtown for nearly a year and a number of grocery stores opened in the downtown business district while I lived there, with plans for more. According to this article [1] from 5 days ago, there are 80 grocery stores in Detroit. Not to mention the awesome Eastern Market year-round farmer's market.

[1] http://www.huffingtonpost.com/jay-walljasper/detroit-fresh-f...

Would love to have you build on this...do you live in the area?

I used to live in Eastern Market in Downtown and could get fresh food there all the time.

Edit: You can buy fresh everything in Eastern Market every day of the week, not just during the market on Sundays.

80 stores serving 700,000+ people, in an area with poor mass transit, is not that much.

There's ~800k people in Macomb County, and there's > 170 grocery stores.

Anyone know if Twitter moved into the Madison yet? and if so - how many people?? http://detroit.cbslocal.com/2012/04/04/twitter-opens-detroit...

Yes, they did. When I was visiting the Madison last week Twitter had a mini office on the third floor with like 2 or 3 desks.

The office is tiny -- like a closet with 3 desks against the walls. I've been by it a few times during business hours and I haven't seen anyone in it yet.

I'd be surprised if Google doesn't have at least a data center in Detroit. Considering how much Google has been investing in urban real estate lately (NYC, Chicago) you'd think they'd want to snap up one of the big old factories and put a mini campus in there.

Google does have a campus close to Detroit (Ann Arbor). This is practically on campus for University of Michigan, which is where they do the scanning for Google Books. They employ ~300 people there right now.

http://www.google.com/about/locations/ann-arbor/

There is also a campus they call Google Detroit (it's actually in the suburb of Birmingham). I'm not sure what they do there.

http://www.google.com/about/jobs/locations/detroit/

The Birmingham location is ad sales

From my understanding (which may be a big outdated now), Birmingham's primary function was to service ad sales to the Detroit Autos.

I've also thought quite a bit about this the past year. I moved to downtown Detroit after graduating from school, and I absolutely love it down here. Granted it isn't as bustling as the valley or SF, but we are slowly building a community of super talented individuals. Hopefully Techonomy can get a few more people out of the woodwork and interested in the community. I'm personally very interested in who is bootstrapping their business from the ground up. I have been doing so for about a year and it has been working out great.

Out of curiosity -- what makes Detroit special (aside from cost)? Why would Detroit be a better choice for Tech than other 2nd tier centers?

Personally I'd say it would depend on the type of software a particular company is making. I think advancements in health tech have a ton of potential here with some of the research going on at the academic centers in the area (Wayne State, Karmanos, Henry Ford Health System, DMC, and outlying areas like UofM and MSU). Enterprise software while not as sexy would also probably be a good fit here as well. If an entrepreneur can make solid connections with the autos and outlying manufacturers and suppliers it can really give you some nice profit and list of clientele that is impressive. Other sorts of software startups may have a tougher time here due to the lack of coverage we get compared to other cities and Valley/SF. While we have DVP, Bizdom, and Compuware ventures it is also tougher to find funding then some areas. There are downsides to the city, but I've grown up in the area since I was born so my connection to it is fairly deep and I really want to see the city flourish as it once did.

Totally agree with your perspective on enterprise software, and inroads to the auto/suppliers/etc being a tremendous opportunity.

I initially thought the same about lack of funding, but it is not true. There are numerous funds as well as angel investors across the state of Michigan that are poorly connected, and historically as a region we've done a poor job of highlighting accomplishments of up-and-comers. We're trying to improve this dynamic.

Interesting. If that dynamic improved I believe that'd be a huge asset to the region. What are your thoughts on health tech in the area? One of my projects is pretty focused on improving the lives of researchers, and I've found this area has quite a few institutions looking to become more cutting edge.

We hosted Scott Case (Founding CTO of Priceline.com) at an event in Grand Rapids last week, covering the implications that the JOBS act will have on the Entrepreneurial and Investment communities alike.

It was...to date, the strongest representation of Michigan VCs I've ever seen gathered together at the same time. Absolutely overwhelmed by this group and the interest they had in health tech in the region.

At the same time, had the privilege of meeting a young Entrepreneur who went from founding Avomeen, to creating a very young startup called Labdoor. He's out of Ann Arbor. I'd bet on this kid in a second...he'll do massive things.

What's the idea behind that "Submit a Story" uncollapsible floating tab on the left side of the page? Seems like you're obstructing a pretty important, content-dense part of the screen with something unimportant and obnoxious that doesn't even generate revenue. Please reconsider this design.

EDIT: It's come to my attention that this only appears to be an issue at 1024x768, which I'm currently using because I'm at work and my employer's computer hardware is ancient. This is probably not a problem for the typical user.

Reconsidered.

$500 for a ticket? As a student, I'd love to go, but that's a little much. Does anyone know of any student tickets, or company sponsoring tickets? I'll wear as much company swag as you want, and be there the whole day.

There are a few opportunities for student outreach from what I've heard. Contact us and we'll see if we can connect you to someone that can help.

Couldn't find an email on growdetroit.com, so I facebook messaged you. Thanks for the help! I really appreciate it.

Yeah, that is too rich for my blood. Plus it is during the week. Real startups have work to do during the week.

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