Tech giant Hewlett Packard Enterprise moving Silicon Valley headquarters to Houston, Texas

ByAnser Hassan via KGO logo
Wednesday, December 2, 2020
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When an icon that helped build Silicon Valley decides to leave Silicon Valley, it may not be that big a deal, says Dilawar Syed of Hewlett Packard Enterprise's choice to leave for Houston, Texas.

SAN FRANCISCO (KGO) -- When an icon that helped build Silicon Valley decides to leave Silicon Valley, it may not be that big a deal, says Dilawar Syed.

"Companies come and go. What's important is that we continue to build a pipeline of next generation of builders who create these amazing brands, and I think for that, Silicon Valley will always remain a key place," says Syed, Chairman of the Entrepreneurship Task Force part of California Governor Gavin Newsom's Office of Economic Development.

Syed is also CEO of the San Mateo-based Lumiata, which provides AI-powered predictive analytics for the healthcare field.

He says when it comes to entrepreneurship and innovation, nothing beats Silicon Valley, given its ecosystem of talent, academics and financing.

But despite that, Hewlett Packard Enterprises, one of two companies created from the split of HP, is moving its headquarters to Houston. The multi-billion dollar tech giant, however, will keep offices in San Jose.

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It is the latest company to exit Silicon Valley. Many cite the high cost of living and state's hefty taxes as reasons.

Syed admits there is room for reform, but he doesn't see this as a trend. And, he says taxes aren't always top of mind for start-ups.

"What you think about is, 'Who is my team? Where can I find the best talent? Who are my investors I can work with? Where are other companies that I can get advice from, that are literally a drive away?'" he says.

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Ahmad Thomas is the CEO of the Silicon Valley Leadership Group, a public policy association, which was founded by HP's David Packard in the late 1970s.

"Situations like this are a real wake-up call to me," says Thomas. "I think we have a lot of work to do to make sure that California remains tax competitive."

Along with tax policy, Thomas says it is critical to investment in infrastructure, like transportation and affordable housing, to create an environment where businesses can thrive, if California wants businesses to stay.

"Give folks in our communities an opportunities to thrive and invest where investments need to be made, but also allow our companies to keep and preserve capital so they can reinvest and build and grow," explains Thomas.

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Soody Tronson, is a former HP engineer and is now an intellectual property lawyer. She says she is sad to see HPE go.

One of her concerns, is when big companies leave, it can have a big impact on smaller firms.

"Many of (these smaller companies), let's say, if they are making something, they could be selling it to these larger companies that are around. Some of them are spin offs," she says.

Another issue is what she refers to as the "commercialization" Silicon Valley's culture.

"There is an industry that feeds off of entrepreneurship. Every day of the week, there is somebody getting (paid) from some poor entrepreneur, trying to get them to pitch to who knows who. Before, people used to help each other. And now, there is none of that," explains Tronson. "If people were coming here for that culture and that culture doesn't exist, what else do we have to offer?"