What Austin Wants to Be When it Grows Up

By Susan Lahey
Reporter with Silicon Hills News

It started out as one of those tired debates about whether Austin—being a city where people want to live and not work 22 hours a day—could ever be another Silicon Valley. But then it got interesting.

The SXSW panel with Brent Bellm, CEO of Big Commerce, Tina Weyand, Chief Product Officer of HomeAway, and Blake Garrett, founder of Aceable, with moderator Lori Hawkins, technology reporter with the Austin American-Statesman, started out by putting Austin’s role in the national tech landscape in perspective. Panelists showed a chart reflecting that Austin is not creeping up on Silicon Valley but is, in fact, 10th in the nation in terms of startup ecosystems.

The number of startups per capita is impressive, he noted, but the dollar amount of investments and exits doesn’t even register. The largest exit of record so far, for example was Home Away with just over $500 million, whereas companies in Seattle are in the billions. Even companies in Salt Lake City, Utah are experiencing exits in the billions.

In other places, Bellm said, people build great companies that provide jobs, stability, the opportunity for people to buy homes, start families have a future. Austin companies either fail or sell at very low dollar amounts. Founders do not hang in there and grow a business for the future.

Initially, Bellm blamed the culture. At 9 a.m., he said, he would see a lot of empty desks in Austin, because people hadn’t shown up for work yet. At 5 p.m., they were empty again.

“They live their lives here, they don’t work that hard. I had to do some very heavy lifting..”

Weyand argued that when people are passionately interested in their work and feel they’re making a significant contribution, they do stay at their desks.

But Bellm also called Austin “a backwater when it comes to business development.” He pointed out that Mayor Steve Adler’s communication to Amazon, which is thinking about locating its second headquarters in Austin, lacked all the things Bellm felt it should have: An appeal to Amazon to come, a pitch about all the advantages, a list of things Austin would do if Amazon came. Instead, he said, Adler pointed out all the problems he didn’t know how to solve that he hoped Amazon would help him solve.

Austin, he said, just isn’t very grown up, and certainly not ready to take a place next to other world-class cities like San Fransisco and Boston. They might want to maintain their culture of little companies and let someone like Amazon be the “adult” company providing steady jobs.

The Turning Point

But then Hawkins turned the question to whether Austin really wanted Amazon. According to reports, the Amazon culture is the polar opposite of Austin’s in that it’s dog-eat-dog whereas Austin is collaborative and generous.

A lot of big companies like Amazon and Google build campuses that are not integrated into the city and actually do not help the local economy all that much.

Moreover, it’s because Austin people do leave work and go to museums and music shows that the city still has such a vibrant culture.

Weyand, who moved to Austin from the Bay Area, noted how great it was to be able to go to a coffee shop and not everything was talking about the same thing. In the Bay Area, the artist all fled tech-infested San Fransisco for Oakland.

The more panelists talked about it, the more they realized they didn’t really want Austin to become a third coast. And a quick show of hands among locals in the audience showed many of them weren’t too excited about Amazon.

Ultimately, Bellm said, having lived around the world he and his wife felt they were in Austin to stay. “The keep it weird ethos of the city rocks.”

Instead, Garrett said, the city needed its own clear vision for where it wanted to go and how it wants to grow and it needs to consistently service that vision.

“What is the vision that the majority of Austin wants for the city?” he asked. With so much turnover in the city, it’s crucial that the outline for the future is clear. “When I look at Steve Adler’s website, all the values he lays out, I don’t think Amazon helps us to achieve those.”

Toward the end of the session, an audience member from California stood up and expressed disappointment to learn that Austin’s tech community wasn’t that vibrant and said, “Who cares what the city wants? What does the tech community want? Who cares about all this keep it weird stuff?”

The tone changed as if he’d insulted their mothers. Each panelist rushed to contradict him and assure him that Austin is a very vibrant tech community—though none tried to explain the importance of keeping it weird or the cultural reality that if you don’t care what Austin wants, you belong in some other city. But the conclusion, if there was one, is that while Austin may complain about the lack of funding and unicorns, it’s not really interested in being a Third Coast or a Second Silicon Valley. The only thing we haven’t entirely landed on is what we do want to be when we grow up.

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