Despite some companies leaving, California set to remain as tech capital

SAN JOSE, Calif. (KGO) -- What do tech giants like Apple, Google and Facebook have in common? They are all born out of the state of California.

While the industry is becoming more competitive with some companies leaving for other states, experts say the assets California has to offer to technology will keep it as the tech capital.
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"The story of modern California is one of risk takers," San Jose Mayor Sam Liccardo said. "It's pioneers who tried what no one else was willing to try. Technology has been a breadbasket here in Silicon Valley and really throughout the state of California. You can find the largest brands on the planet from Google, to Apple, to Facebook, to Cisco and newer companies that are sprouting out and growing rapidly."

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One of those new companies is based in Southern California.

Galora Sharing is a way that neighbors can share homemade or homegrown food products and share them with neighbors.



The founder says California helped set his company up for success.

"You don't have to be part of the fraternity of startup guys anymore," Galora CEO and Founder Ryan Xavier said. "There's something about California that's being a bit more expansive. They're really trying to open up all of the incredible resources here. Our website gave people a way to not only meet other people, but to put food on the table in a less expensive way and to do something positive. I think California was the right place for that. I think there's something very idealistic about what we're doing and it is something that's tapping into that California dream. Everybody in California hopes to do something broader, something more impactful for their lives. People move here, because of all of the opportunity, because of all the potential for success and to be able to achieve their career goals."
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"We've been a draw for folks from around the country and globally who want to have a big success, the venture capital industry, and those things have really made this the center of innovation in the world and we're trying to protect that," Bay Area Council CEO Jim Wunderman said. "I don't think by any means we've lost the distinction of being the global leader in innovation. But, I think the landscape is much more competitive now."

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In December alone, Silicon Valley saw the loss of Hewlett Packard Enterprises, who moved its headquarters to Houston. Oracle was one of many Bay Area companies to move out of state in 2020 as well. Elon Musk said he's moving from California to Texas, because "California takes innovators for granted."

But experts believe it's not all falling apart for tech in California.



"The story of the tech exodus is probably a bit overplayed and, in some ways, it's underplayed," Liccardo said. "It's overplayed, because I talked to tech leaders every day who are telling me, 'look, we're not going anywhere any more than we ever have.' It's underplayed in the sense that this has been going on for a while. For the last two decades, Intel has employed far more residents in Oregon than it has in California."
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As far as solutions go, experts say California needs to make it so tech companies can employ staff and keep them here so the innovative people remain in the Golden State.

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"Housing is a really big function of this," Wunderman said. "It's so expensive for companies to attract and retain talent here, especially as the median price home is so high compared to other parts of the country. Google and Facebook are good examples, Apple, they've put a lot of their resources from their treasuries into affordable housing. So they're actually, kind of putting their money where their mouth is. But I don't know that we've seen that in any other part of the country. We're problem solvers. I think at the end of the day, I feel very positive that we'll work our way through this and a lot of the folks who may have headed to Texas at one point, for example, I wonder if they're not on the way back already."

"The great threat to the future of our state isn't that billionaires may move to other states or that industries will choose to grow throughout the world," Liccardo said. "The great threat to California is that innovative people will no longer start the next great idea in a garage here in California. Silicon Valley and California will continue to be the place where tech happens. There's much we need to do to create a more affordable California where people can continue to come from around the world to be able to launch their next great idea, to be able to work and strive and achieve the California dream."