
Tech startup scene starting to flourish in Oakland - jessepollak
http://www.sfgate.com/politics/joegarofoli/article/Tech-startup-scene-starting-to-flourish-in-Oakland-5360393.php
======
paulbaumgart
Most of the rise in commercial rents in SF is related to the non-linear
economics of the top tech startups. If your business model is scalable enough
(and you're executing properly), the vast amounts of available capital mean
that rent is a pretty negligible expense.

The trend we're seeing in the prices of things that software startups need to
pay for-- primarily talent and office space-- is that they're also starting to
follow a power-law distribution.

I wouldn't be surprised if, in future, the most desirable commercial real
estate and the most desirable employees start costing an even larger multiple
compared to the median.

------
thrownaway2424
I moved to SF 20 years ago and to oakland 5 years ago. The differences are
pretty huge. Main thing for me is oakland is the place where people make
things. There are lots of cabinet makers, butchers, shipwrights, and suchlike
places. Even things that people might associate with sf are sometimes made in
oakland, like boccalone meats, or blue bottle coffee. There are loads of
hacker spaces and coops, too.

If you want to start a business you could hardly find a better place. Real
estate is cheap. Labor is readily available up and down the scale. You can
find plenty of janitors, stone masons, or maybe you can even poach employees
tired of the commute to Facebook or genentech or yahoo. Transportation costs
approximate zero since there is no parking pressure, a subway, a sprawling bus
system, and mainline train service, which even sf lacks.

So if you are out to start a business oakland makes sense. If you want to be
in the valley scene then of course it makes no sense at all, not being in the
valley and all that.

~~~
dllthomas
_" Real estate is cheap[er]."_

~~~
thrownaway2424
True, but any gradient in real estate prices will tend to induce a flow of
people.

~~~
dllthomas
Certainly. It's an important point, it was just simply to make it a more
correct point so I did.

------
6cxs2hd6
> _The city also lacks a cluster of local venture firms that could kick-start
> investment in hometown companies. And the major players on Sand Hill Road
> tend to spend in San Francisco 's better-established tech scene or in the
> valley closer to home._

This makes Sand Hill sound extremely insular and provincial -- that it's not
enough to be in the Bay Area, you have to be in one of the "right"
neighborhoods. That Oakland may as well be Podunk, Flyover State. Is that
really true??

~~~
paulbaumgart
There is a feedback loop at play: the entrepreneurs go where the capital is
and the capital goes where the entrepreneurs are. The geographical
distribution arises organically from that feedback + the initial seed of
Stanford University.

It's not that VCs look down at Oakland per se, it's that there aren't many
good investments to be found there.

------
hueving
It was briefly touched upon in the article, but would a current Oakland
resident care to shed some light on the crime that does occur? Is it mainly
focused to a few bad areas, or do you always have to be extra careful when out
in public after dark?

~~~
e40
I walk 4 miles a day (to and from work) in the city. The crime (of all sorts)
is mainly in the really bad areas. 14th and Broadway is a somewhat higher
crime area because it's a major bus transfer point (I got this from the crime
maps that OPD put out).

Lots of people on the other side of the hills (Concord, Moraga, Walnut Creek)
have this idea that Oakland is a really scary place. I think it's partly
racial (because of the higher percentage of African Americans here) and partly
a PR issue (the 24/7 news cycle only presents sensational items).

I've lived in the area since 2001. I lived in Berkeley for the 13 years prior.
I had more problems with crime there, and I was fairly close to campus. People
don't normally think of Berkeley as a high crime place, either.

The most dangerous thing I deal with on a daily basis? Cars and bikes. I
always cross the street legally, but both cars and bicycles have issues when
it comes to respecting pedestrians. I've even seen a police car not yield for
a pregnant woman pushing a stroller in a cross walk! He cruised by her within
inches. I was dumbfounded. She was in the middle of a 4 lane (2 each way)
road.

~~~
dragonwriter
> Lots of people on the other side of the hills (Concord, Moraga, Walnut
> Creek) have this idea that Oakland is a really scary place. I think it's
> partly racial (because of the higher percentage of African Americans here)
> and partly a PR issue (the 24/7 news cycle only presents sensational items).

Those may each be part of the issue, but I think that a big part of the issue
is the actual crime statistics that show that, indeed, Oakland is, in fact, a
dangerous place by comparison to those other places.

I mean, there's something about Oakland having a little over 3 times the
population but a little under 20 times the number of violent crimes as Concord
in 2012 [1].

[1] [http://www.sfgate.com/crime/article/Crime-up-in-Oakland-
much...](http://www.sfgate.com/crime/article/Crime-up-in-Oakland-much-of-Bay-
Area-4573391.php)

~~~
e40
But all parts of the city are not the same. The very high crime areas, no
where near the downtown, are what skews the stats. Downtown Oakland is no less
safe than a lot of other cities. Certain parts of Oakland are a lot less safe
than the worst parts of many other cities.

So, do you avoid Oakland or avoid the bad parts of Oakland? I, personally,
just avoid the bad parts.

------
mikeryan
So the biggest issue I see right now with Oakland is that it really suffers
from a lack of decent or desirable office space.

I'm currently 15 months into an SF lease for my company and when I originally
looked for space I spent a lot of time looking in Oakland thinking I'd get a
lot greater value. Unfortunately I found only one nice "SOMA style" space in
Oakland it was right on the edge of Chinatown in an area I'm not sure I'd want
female employees walking to BART late at night.

Honestly there's a huge opportunity here for some developers to look at
building out some nicer office spaces in Oldtown, Jack London or the
Grand/Broadway area near 19th St BART. I don't mean stuff thats gorgeous just
something slightly contemporary would be an upgrade.

~~~
sAuronas
The crime problem is overstated. While it appear high on a per capita basis,
cities are dynamic. The cancers that plague the city will be forced out of
downtown and Jack London once business activity picks up, because that will
coincide with an increased presence on the street of people doing things as
well as more police (the force is less than half of what is needed).

Oakland has this very unique history of activism that really scares people
into not investing here and even that is changing -- for the better.

Funny thing about $1,000/SF apartments in the city though...people start to
re-evaluate their options. Even if you do not move your office space to
Oakland, you can't beat the 15 min commute from downtown Oakland into the
"city". Oakland will never really rival SF but it does not have to. Today,
without much of a tech scene, Oakland has many attributes (big city amenities
with a small town feel) that allow it to trump the city, including better
weather.

I will go on record by saying that Oakland (core, around lake, downtown, Jake
London, Uptown, etc) will become one of the most desirable place to live in
the Bay Area within the next 10 years.

~~~
mikeryan
I want to clarify, the crime thing isn't the main thrust of my argument. Its
an issue but not the one I'm addressing. My point is that a lot of the actual
physical spaces I saw were outdated offices or Office Space style cube farms.

~~~
skyebook
Give it 5 years and agents will start calling those cube farms a "Retro and
Quirky work environment"

------
prodigal_erik
I think there's a fair chance that the "class" motivated hate against tech
workers will turn violent, and if it does it'll be sooner and more severe in
Oakland (and the Mission) than elsewhere in SF and the valley. We're already
seeing hints: [http://blog.sfgate.com/stew/2013/12/20/bus-blocked-again-
in-...](http://blog.sfgate.com/stew/2013/12/20/bus-blocked-again-in-tech-boom-
backlash/) [https://defendthebayarea.org/call-for-a-week-of-action-
march...](https://defendthebayarea.org/call-for-a-week-of-action-
march-28-april-5-2/)

------
naveenspark
I live and work in Oakland. My office is 3 blocks from 19th street BART in the
heart of uptown. There is so much incredible development happening in this
part of the city. The Hive project launches later this year (The Hub is
already open in the space) with awesome new apartments, and amazing new food
options. From Lake Merritt to Jack London Sq. to Rockridge to Montclair there
are a wide range of options to consider for office / living space. Its also
typically ~10 degrees warmer then SF. If you have any questions feel free to
ask and I'll answer when I get back this afternoon.

------
samstave
Im biased. I cant stand anything about oakland.

I recenty looked at an amazing house on an amazing street, but opted against
it because the adjacent area was far too ghetto and, even though that street
(in maxwell park) seemed wonderful - the surrounding area off high street
would make bikeing or walking to a store or bart unpleasant.

Where i want to see startup spaces is on the old naval base in alameda.

EDIT: apparenty saying you dont like oakland is an unpopular opinion to have
;)

Well, for those talking about it, please come check out alameda - its the best
city in mediate vicinity to SF, IMO.

~~~
ZanyProgrammer
Alameda has piss poor public transit connecting it to Oakland. Plus the
opposite side of the Oakland Estuary is Fruitvale, not exactly one of the more
desireable areas to live in.

~~~
samstave
The 51A and the O run every 10 mins. I take the 51A every day I dont bike, to
fruitvale bart.

Its clean, cheap and fast.

Also - thats hardly an argument against putting that site to work. It can be
easily fixed, ala emeryvilles go-round type os service.

------
mightybrenden
Here's one of my favorite new startups in uptown Oakland
[http://spotlabs.com](http://spotlabs.com)

------
morenoh149
I live in SF and have a friend that lives in oakland. Always interested in
possibly moving out there or getting a work space out there.

------
h1karu
oakland daytime sideshows:
[http://www.youtube.com/watch?v=Quzzw2rW4_M](http://www.youtube.com/watch?v=Quzzw2rW4_M)

~~~
e40
Yeah, that's really representative of Oakland. Cripes. You've shown something
pretty far away from downtown, which is what the discussion is all about.

~~~
h1karu
not tryin to hate; I wish we had that shit in Atlanta

~~~
e40
You want gang controlled, high-crime areas? I'm sure Atlanta already has them.

~~~
jessedhillon
Why are you assuming the side shows in the video are gang-related? All I see
is a bunch of guys -- actually remarkably multiracial, exactly the opposite of
what a gang scene would look like -- enjoying car stunts. It's pretty awesome
AFAICT.

~~~
e40
Because that area is so gang infested that OPD ignores large swaths of it. Any
other neighborhood that closed down the street for that type of "fun" would
have OPD swarming on them in a few minutes. Not this one.

