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San Francisco Bubble

• nugget 11y ago
  It's a gold rush. Nothing new. Fun to watch once you have the context to understand what is happening.
  • zzalpha 11y ago
    Except in a gold rush everyone is trying to get a piece of a real, actual resource. What are folks flocking to? A unique combination of deep VC pockets and gullibility that can only be found in the SF geological record? No, this looks more like a regular ol bubble to me... The flywheel is spinning up, driven by run of the mill irrational exuberance and a belief that everyone in the bay area is just smarter than everyone else. Anyone on wall street in 2007 should find that eerily familiar...
    • deleted 11y ago
      [deleted]
    • chipsy 11y ago
      Gold isn't particularly real, as resources go. It doesn't have that many practical uses. That's what makes gold rush economics similar to bubble economics: Everyone decides to chase after a nebulous source of value. San Francisco has always been the Gold Rush City.
  • chrisan 11y ago
    > It's a gold rush Which means it is best to sell the shovels so startup X can more easily/faster "disrupt the banana hammock ordering process"
    • etjossem 11y ago
      Nobody's selling shovels. Everyone is selling month-to-month shovel subscriptions.
• themagician 11y ago
  Money has been close to free for years. As the interest rate ticks up everything will change. It's already starting to. More expensive borrowing, less leverage, and better places to put dollars than venture. The one thing I really agree with though is the funny thing that happens here with the word "engineer". If you can make a website you somehow qualify for the title software engineer. By Bay Area standards, I myself am director level engineering talent—and I get offers for such all the time—and yet I don't even remotely consider myself an engineer. Because I can make a website? Because I know a little python, ruby and node? Come on. I've never written anything that lives in a real production environment and you want to hire me as your director of engineering? Are you mad?
  • objclxt 11y ago
    > [...] and yet I don't even remotely consider myself an engineer. I phone screened somebody not so long ago who asked me if it was the "kind of job where you have to write a lot of code", because they "weren't that sort of software engineer". Didn't quite know what to make of that.
    • wwweston 11y ago
      That person might be perfect for my job. I've been largely reading mountains of code that other people have written, until I understand what it does, and then make (usually small) changes in order to either fix a defect or add functionality. I don't love it. Maybe the person you screened should be doing my job.
    • sbov 11y ago
      Some of the funnest jobs are when you delete lots of code.
    • Apocryphon 11y ago
      Maybe he was an IT person who doesn't know what IT is called.
    • swalsh 11y ago
      It could be an awful way of saying he prefers maintenance to new development.
• avitzurel 11y ago
  "There are thousands of dumb startups" This. Most of the blame is cast on the big companies (Twitter, Facebook etc) but the reality is that there are hundreds of smaller companies choosing SF and the valley in general. And again I say, until companies allow people to work from wherever this will be fueled more. Finding talent is getting ever more difficult already, if you expand your search area to the entire country/world there's a better chance you'd find people no?
  • ryanSrich 11y ago
    They don't need talent. They need mindless drones to work from 10am to 9pm in cramped co-working spaces. There is nothing interesting or challenging about the "problems" these startups are "solving".
    • EC1 11y ago
      Exactly. Read my latest post - https://news.ycombinator.com/item?id=10976903 https://news.ycombinator.com/item?id=10976903. I hate the culture/environment of co-working spaces. I don't understand why people are so opposed to working from home, they automatically assume everyone is a child that can't manage themselves. Now I have to waste YEARS of my life getting to an office.
  • drawkbox 11y ago
    I like SV and do wish it would spread around more. But it does seem like companies aren't considered a startup anymore unless you are paying some of the highest rents in the country in SF. Something doesn't compute, high rent is not the best decision for early stage companies except in SV, unless there is some other angle like maybe you own the building/real estate. Maybe in the end lots of VC is real-estate plays parallel to product development.
  • deleted 11y ago
    [deleted]
  • mikeryan 11y ago
    "There are thousands of dumb startups" This is a feature not a bug. The whole VC model the Bay Area thrives on is based on the premise of hitting on only a small percentage of successful startups and you never know what's going to be a hit. Many successful startups have pivoted out of "stupid" ideas. I'm sure at one point "Blogging 140 characters at a time" was considered a stupid idea.
• encoderer 11y ago
  tldr: Guy comes to SF, figures it all out in a weekend, sees things that I've never seen living here like 'dozens of co-working facilities in 10 blocks'. Here's my take: The concentration of wealth here still pales to NYC area, Google, Apple, Facebook alone are giant money funnels from the whole world into this area, and there are more funnels being built every day. Not saying it will or should go up in a straight line, but personally I'd bet on the trend.
  • thelarry 11y ago
    No, it was a three day period in the middle of the week.
    • mikeryan 11y ago
      Well that's plenty of time to make sweeping generalizations. Carry on.
      • david927 11y ago
        Sweeping and evidently spot on as well. Carry on!
        • derrickdirge 11y ago
          What's the evidence that it's spot on?
          • deleted 11y ago
            [deleted]
• grimmdude 11y ago
  Perspective is key. Where is this guy finding $15 IPAs? $16 tiny artisanal salads? Sure they're out there, but in my opinion it's just as easy to find reasonably priced restaurants/bars.
• leroy_masochist 11y ago
  > A company to “disrupt the banana hammock ordering process” cannot possibly do well yet someone invested money into it and it is paying employees. Is this actually a real company and if so can someone post a link?
  • scholia 11y ago
    I didn't even know that "banana hammocks" were a thing. Maybe whoever runs bananahammockworld.com reads HN.... http://www.bananahammockworld.com/banana-hammocks-for-men/ http://www.bananahammockworld.com/banana-hammocks-for-men/
    • Paul_S 11y ago
      Should carry a NSFW warning. I had no idea what a banana hammock was, I thought it was an actual hammock.
      • tragic 11y ago
        I thought it was somehow tied into the hipster-foodie thing, like you'd get charged $15 for a 50 cent banana if it was delivered to you by some precariously employed scooter driver swaddled up like the baby Jesus. Perhaps it's my unadventurous lifestyle, but I have never found myself in a situation where I so urgently needed a posing pouch that 'Uberising' the industry would have helped me out.
      • scholia 11y ago
        Apologies: I didn't think of that. I had no idea what it was either, so I thought I was saving you a search.....
  • gramasaurous 11y ago
    Could be talking about [0] meundies. Although that seems to be an LA company based on their hiring website. [0] https://www.meundies.com/ https://www.meundies.com/
• minimaxir 11y ago
  Looks like this week is "Maybe Startups Aren't Inherently Great" week on Hacker News. :p That being said, the number of startups in San Francisco is fine as long as there is corrective balance. At the least, startups which are failing will die faster due to rent alone.
  • nordic_nomad 11y ago
    Valid point. Maybe rent is a control factor. Otherwise they'd just hang on forever.
• deleted 11y ago
  [deleted]
  • johansch 11y ago
    Bay area real estate.
    • toomuchtodo 11y ago
      All of the above.
• deleted 11y ago
  [deleted]
  • cmollis 11y ago
    Yes, it's currently a broken process.
• YuriNiyazov 11y ago
  "They can take an arbitrary sabbatical from work, they cannot be told no or reprimanded, and they make so much money that they can just take random breaks from employment to chill." I have yet to hear a convincing argument why this is a bad thing.
  • lettergram 11y ago
    The guy sounds pretty bitter, to be honest.
    • scholia 11y ago
      Bad news if his life is as grey as his type....
  • fweespeech 11y ago
    Honestly? It isn't sustainable and its not a productive use of capital. This lifestyle is going to implode when the economy stumbles.
    • YuriNiyazov 11y ago
      Yea, no. JM Keynes said eons ago that with increases in efficiency we will eventually be able to get to a 15-hour work week. So, a particular industry in a particular area was able to get to an approximation of that, and the counter-argument is that this is not a productive use of capital? Besides, TFA complains that all these people are working on silly startups, which is presumably not a productive use of capital either. You can't have it both ways.
      • munificent 11y ago
        > a particular industry in a particular area was able to get to an approximation of that On the backs of whom? How much are those Uber drivers, grocery deliverers, and artisanal salad chefs making? It is good that one group of people is moving forward, we just have to be careful that we aren't doing it at the expense of other groups. The impression I get is that in the US today, it's not just that some people are getting richer, many others are getting poorer.
• njudah 11y ago
  Not withstanding everything else, I've lived in this town for years, and always found it easy to find a reasonably priced beer.
  • skewart 11y ago
    Yup. It's still shockingly easy to find good beer at a reasonable price in the SFBA. Same for food if you know where to go. The only thing that's really hard to avoid spending way too much money on is housing.
    • toomuchtodo 11y ago
      > The only thing that's really hard to avoid spending way too much money on is housing. Live in a van down by the river, or a cargo truck in a Google parking lot.
      • beamatronic 11y ago
        TruckBNB Next billion dollar startup
    • amyjess 11y ago
      > The only thing that's really hard to avoid spending way too much money on is housing. And people shouldn't discount that. Here in suburban Dallas, I'm paying $1220 (soon to go up to $1270) per month for a 1513 sq. ft. townhouse that I have entirely to myself. And my commute isn't bad because most of the tech companies here are also in the suburbs (the Telecom Corridor in Richardson). Good luck finding anything like that in SF. I'm a very private person, and I like having a lot of space to myself. The idea of having a roommate or living in a small apartment (especially in an urban environment) makes me physically ill. I'd never be able to live there.
  • thelarry 11y ago
    You're probably right. I was being a bit excessive with the beer comment, I just found it funny that I never recognized anything on tap. I'm also not really an IPA guy =/
• sixQuarks 11y ago
  Regarding dumb startups - I can't wait for the coming collapse. There are lots of talented developers/designers working on dumb startups, which makes it very difficult for me to find good people to work with.
• philfrasty 11y ago
  "Engineers are particularly spoiled. They can take an arbitrary sabbatical from work..." <---> (on the about page) "...Currently a principal engineer at AppNexus on sabbatical..." ???
  • theseatoms 11y ago
    Takes one to know one. ;)
  • thelarry 11y ago
    I'm very hypocritical.
    • YuriNiyazov 11y ago
      Yea no kidding. "AppNexus helps brands connect with consumers, empowering agencies and advertisers with a uniquely powerful approach to programmatic online advertising." Thanks for working on Ad Tech, the very thing that powers this bubble by trading attention as a commodity. Other people work on silly startups, but this shit is akin to HFT.
      • jbooth 11y ago
        Unless microtransactions for content take off, and they haven't, ad tech is necessary to incentivize content on the web. 90% of the websites you read could not exist without the ecosystem that appnexus is a big player in. Hacker News, being one big ad for ycombinator, doesn't need to bother. So he's doing a real thing that provides real value to the web. And it's actually a sustainable business, to boot. Lastly, there's absolutely no need to get so personal -- if his article offended you, discuss the article.
        • Kinnard 11y ago
          You know, this might be the year when microtransactions for content actually take off.
        • YuriNiyazov 11y ago
• halis 11y ago
  You should rename this thread California Bubble...
• azerty1 11y ago
  interesting op is on a sabbatical himself > Currently a principal engineer at AppNexus on sabbatical, I am trying to have a new post every day.
• mikeryan 11y ago
  Hmm.. Here's Rosamunde's beer list plenty of $6 IPAs.. https://www.beermenus.com/places/1609-rosamunde-sausage-grill-mission https://www.beermenus.com/places/1609-rosamunde-sausage-gril...
• gravity13 11y ago
  Re: There cannot be these many quality engineers. I've seen grads come out of boot camps that are better programmers than people who have been programming for years. They might lack the knowledge, but they've got good sense and hustle, and at the end of the day, I'd take that over a stubborn engineer who looks like they're gonna age into a Dilbert comic.
  • brianwawok 11y ago
    I mean, if I am developing an app for millions of users - I would hope there is at least 1 engineer on the team that understands O(n) vs O(n^2). If the app is for 10 users or for the other 75% of employees, may be less important...
    • wesleyfsmith 11y ago
      I taught at a bootcamp for a while and always covered big O. It's pretty important for interviewing. Bootcamp kids know more CS than you might think...
      • niuzeta 11y ago
        It sounds like prep school for interview exam
• ejcx 11y ago
  > Everything is too expensive. I’m from New York... I take issue with this one. It's entirely possible to live frugally while living IN San Francisco. I moved here about 7 months ago and expected it to be incredibly expensive but it hasn't been the case (beyond rent). The author mentions $15 crappy local IPAs but I've actually never found a beer for this price. There is no shortage of $7 craft beers you can buy at a brewery or bar, no shortage of Trader Joe's with the same prices as, say, Charlottesville VA. I've found that other than rent, the prices are comparable to other places. If you get a salad delivered on postmates or uber eats or something then that's what you're paying for. That isn't SF. I think a lot of people are living a lifestyle where they have no problem paying for stuff like a delivered salad when they can walk next door, or uber instead of taking the bus, but lots of people are walking and grocery shopping and not paying those prices.
  • DannyBee 11y ago
    Compared to NY, he's wrong. Compared to most other places, even other metro areas, he's very right :) Prices in SF are definitely 2x-3x what I have paid anywhere else. In fact, every time i visit, say, chicago, or atlanta, i'm strongly reminded of this fact. Can you find quality places in SF where that's not true? I'm sure. But on average, it's definitely the case that it's significantly more expensive here. You can compare the CPI as well: http://www.numbeo.com/cost-of-living/compare_cities.jsp?country1=United+States&country2=United+States&city1=New+York%2C+NY&city2=San+Francisco%2C+CA http://www.numbeo.com/cost-of-living/compare_cities.jsp?coun... http://www.numbeo.com/cost-of-living/compare_cities.jsp?country1=United+States&country2=United+States&city1=Chicago%2C+IL&city2=San+Francisco%2C+CA http://www.numbeo.com/cost-of-living/compare_cities.jsp?coun... Groceries should not be 40% more expensive in SF :)
  • vectorjohn 11y ago
    Compared to Portland, $7 a beer is actually pretty expensive. Not as crazy as the mythical $15, but for a local craft beer it should be more like $5-6. But that could all just be taxes. (and we do have $7-12 beers, they're just known to be extra fancy or aged)
    • 11y ago
• swang 11y ago
  nothing against the author but it seems like he is painting a very wide brush with something he's seen for 3? days. i certainly have never taken ubers everyday to work even though i could probably(?) afford to do so. seems like an expensive daily habit though. i actually live in the city where it's not some huge loft in fidi/downtown. good for anyone who can get their groceries sent up to their room but i'm not sure how close to the norm that is. tech workers are all across the board in terms of how they live, how much they get paid and how willing they are to fetch their own groceries. i live on the first floor of a older apartment complex, but i have to walk down a hill to fetch my groceries. i do sometimes use one of the gazillion food delivery services to eat dinner though. anyways i would say this is similar to someone who goes to ny, visits the financial district in manhattan for 3 days and then proclaims, "everyone in ny is rich! of course they can afford all that housing! they're so stuck up! why are the cabbies so rude? why are new yorkers so rude?"
• rdlecler1 11y ago
  The guy makes some good points, and there does seem to be a lot of questionable startups, but it's not like they're tapping into public funds. Somewhere, somehow, some angel investor thought that it was a good team and a good idea and they were happy to part with their money. It's better that we live in a more optimistic world than one where every crazy idea is a bad idea. However, how is taking Uber to work every day 'spoiled'? I bet the guys owns a car where he is from and spends significantly more on monthly transportation than I do. For $4 more than a bus, I get point to point pick up and drop off, and save about 40 minutes of my time (which I can use to go work out in the mornings). And some others have figured out that it makes sense to spend $20 on grocery delivery rather than spending 90 minutes doing it yourself if you're working 60-80 hours per week and make more than $20/hour. To be sure, a lot of people work long and hard. They make certain sacrifices but just because they are not the same sacrifices that the author would make it doesn't mean they're bad.
  • amyjess 11y ago
    > For $4 more than a bus Depending on where you live, Uber/Lyft can be a lot more expensive than a bus. In Dallas, a monthly public transport pass costs $80. This comes with unlimited uses of the buses and trains for an entire month. Let's say you work twenty days (four weeks) a month, with a trip each way. That amortizes to $2 a trip, less if you also use your pass for personal trips on weekends. Lyft costs me about $11 on average to get me between home and work. If I were to take Lyft to and from work every day for a month, again assuming twenty working days a month, I'd be paying about $440 a month. That's not $4 more; it's $9 more. That's 5.5 times how much I'd be paying for public transport. Again, that's not counting using it for personal trips on weekends (here, the minimum is $5.70, including the trust & safety fee). If Uber/Lyft is only $4 more than a bus in SF, then buses are way expensive there.
    • jamesfzhang 11y ago
      Agreed that it definitely depends on where you live. I don't, but could, take an Uber/Lyft for my commute everyday and it would cost about $5-$7, whereas a ride on SF public transit would take $2.25 and + 10-20 extra minutes.
• wesleyfsmith 11y ago
  I have to say that I didn't really understand the perspective the writer was coming from. It kind of felt like he just wanted to finger wag at SF. > Everything is too expensive. Just normal supply and demand economics. This happens all the time all over the world when lots of high earning people suddenly move to an area. > There are thousands of dumb startups. Yup. And most of them will die. And some of them will become AirBnB. The problem is, it's extremely difficult to predict which is which. That's just the nature of searching for "the next big thing". I'd rather live in a world where there are lots of dumb companies so that the few exceptional ones have a chance to get started. > People are spoiled. No, people in SF value their time, as it's the only resource you can't get more of. I absolutely understand why someone with the money would have groceries deliver for them. It's more efficient. The locally sourced and organic thing does feel a bit silly though, although I would say that's a fad you see everywhere. > There cannot be these many quality engineers. I'm sure there are some bad engineers there. But SF has a massive pool for exceptional talent, and while I'm sure not every engineer is extremely high quality, I have no doubt that a substantial amount of top tier programmers are in SF. If the majority of programmers weren't making meaningful contributions to their companies, I don't think you would see them being compensated the way they are.
  • deleted 11y ago
    [deleted]
  • MonadQueen 11y ago
    Some of the dumbest ideas are the biggest. Strangers driving you in their cars? People turning their spare rooms into hotel rooms? I wouldn't have believed (or invested in) either of these ideas. My favorite example is YouTube. If you had asked me if I wanted to invest in a video upload site where 95% of the material were pirated clips off of TV I would have said "you're crazy! You'll be sued out of existence."
  • sandworm101 11y ago
    >> I absolutely understand why someone with the money would have groceries deliver for them. There is s difference between lazy, spoiled and pretentious. Rich people have existed for a very long time. Few have ever had groceries delivered. The hire personal shoppers, housekeepers, chefs, maids to buy their food. This getting groceries delivered is a passing fad, an affectation for people looking to cultivate an image of themselves. Having more money than time is nothing new.
• DannyBee 11y ago
  I'm surprised he didn't have the $16 artisanal salad delivered to him by one of the 37 delivery services. This is pretty much the only place i know of where people are okay with paying $30+ total for a salad and think it's normal
  • antisilent 11y ago
    I've lived here since 2005 and have yet to see a $30 salad.
    • DannyBee 11y ago
      I said "$30 total" (IE salad + delivery).
• tyre 11y ago
  The talent issue is particularly acute. If you're mature and hardworking, I have no problem with you taking PTO whenever you need it or not committing to hard deadlines. But those are earned privileges based on trust and a history of delivering. It is so hard to hire software engineers and there are tons of them. Bootcamps are not the answer. It is not a quantity problem, it is a quality problem.
• colmvp 11y ago
  There might be a bubble, but extremely limited anecdata isn't enough to prove it. Who cares if people are spending money to get shit done for them that they don't want to personally do (laundry, groceries). As long as they can pay for it and are utilizing hours to what they actually want to do in life I don't see the harm. And expensive food exists in most major cities. There might be some truth to the title, but the article lacked the data to support any of it. I'm flabbergasted that it got upvoted on the frontpage of HN.
• someear 11y ago
  There are lots of dumb startups. But a handful of these dumb startups are going to turn into big, meaningful companies that change some aspect of people's lives, hopefully in a positive way (at a minimum they will offer employment). Because of that, it's worth putting up with these "dumb" ones because 0.1% of them will pay off the other ones. Companies evolve, and some don't stay dumb forever.
  • crimsonalucard 11y ago
    meaningful way? Something like Facebook has certainly changed things, but whether or not the change is meaningful remains up for debate. Most of these 'changes' just make our lives slightly more convenient or seem a bit more futuristic, but these are illusions. Change that is categorically meaningful involves things like a cure for cancer, a new source of energy, etc..etc.. If we are to judge whether this startup trend has changed peoples lives in a meaningful way, we should look for changes that are categorically meaningful.
• lucio 11y ago
  The problem is that you never know which one of the "silly" startups will succeed. ¿How about a startup disrupting the "large" market of air-mattress renting to complete strangers?.... mmmm... Let's toss a breakfast in... That's is, let's call it: "Air Bed and breakfast"... it is silly?
• mbesto 11y ago
  This is why the free market is so great. 1. Everything too expensive? Good, don't live here, eventually enough people will leave to drive all of the costs back to other market norms. 2. Dumb startups? Good, they will fail, people won't be able to afford to live here and they'll leave. 3. People are spoiled? Uber is cheaper and more convenient in some cases than taking the local transportation. When people stop taking public transportation because it's fundamentally broken (ps - it's awful in SF) then it will force government organizations to re-think their planning. 4. Bad engineers? Yup, I've met some of them. They'll eventually leave too when the system weeds them out. I too think it's weird here, but since I do enjoy my life in the Bay area enough, I'm happy to wait for the market to correct to normalcy. The people who are here just to chase the "me too's" will soon be forgotten. EDIT: I should probably clarify my overall sentiment. People who come to SF and complain that this situation is less than ideal have the freedom to simply choose not to play. The cost of living is driven by the simple laws of supply and demand. Speak with your wallets, not with your mouths.
  • josh2600 11y ago
    Part of the fallacy of this is the implication that you need "good" engineers for most startups. I think, frankly, that many startups need a website with a google form + some excel sheets to get started and if the thing takes off they can hire someone who can use google to bang on stackoverflow. Very few things require genuinely novel pieces of code to work. Yes, lots of value can be captured using code, but you could totally start something like airbnb with a lot of manual labor clicking in a GUI. Djikstra said "Beware premature optimization" and that's quite true. I think automation should be used when things hurt to bad to do manually anymore. For some people, that's any task which must be performed twice and then you write a script. For others it might be years manually updating excel for bookkeeping every night. One can go real far manually updating excel...
    • grandalf 11y ago
      Excellent points. In most startups it doesn't take much technology to prove (or disprove) the business model idea. For the few startups that do experience significant growth, it's much easier to find talent (engineering and otherwise).
• crabasa 11y ago
  This is probably the worst item I've ever seen rise to #1 on Hacker News. It's poorly written, is based completely on a weekend worth of anecdotes and makes several claims that seem impossible ($15 IPAs).
• varelse 11y ago
  If you hate current day SF, you'll looooovvve NYC...
  • slantedview 11y ago
    The author is from NYC.
    • varelse 11y ago
      IMO (speaking from my recent disastrous stay in NYC): Pot.Kettle.Dystopia...
  • seiji 11y ago
    I moved from The Bay Area to NYC. Things I miss about The Bay Area include: meetups where the attendees are actually useful people you want to talk with, more similar developers (NYC developers tend to have +20 years on SF developers unless you're at a we-only-hire-22-year-olds startup), developers more plugged in to current trends instead of just getting on board with what was introduced 5 years ago, in NYC every other company is in "adtech," in NYC the typical career path is startup/company -> create your own HFT startup, lack of winter (but I don't miss the lack of water), ....
    • varelse 11y ago
      What do you like about NYC? I spent a couple weeks there recently, to which I was really looking forward since I had never been there, and after about a week I loathed the noise, the garbage everywhere, and the lines at all the stores. Shortly thereafter, I caught the Norovirus from delivered food and I was knocked out physically and mentally for almost 2 weeks. What did I like? Seeing a few famous landmarks, a couple of the restaurants, and my rental apartment had free NetFlix.
      • seiji 11y ago
        What I like: not needing a car (no car payment, no car insurance), any event (concert/meetup/parade/show/etc) is only 20-30 minutes away door-to-door and you don't need to park since you have no car, central park is okay (but it's no red rocks or la honda), you'd think having 6 million people within a 6 mile radius would make it easy to meet people but... not so much, housing prices are (supposedly) less than SF but it's still painful, tons of non-chain places to eat, my 300+ Mbps home Internet access for $80/month, can be at any airport in about 30 to 60 minutes (taxi to LGA or subway+airtrain to JFK or nj transit+airtrain to EWR), etc. I've done the whole norovirus dance once too. It really does knock you out for a week or two. (I started feeling sick when walking around outside one morning, decided to take the subway back home, the first sickness struck while waiting for the train—I just had to throw up on the subway tracks. Pretty awful. Some nice bystanders gave me an unopened bottle of water they had with them which was nice.)
• minimax 11y ago
  local IPAs are $15 Is that actually true?
  • jdminhbg 11y ago
    Barring some kind of super-rare specialty (Russian River's Pliny the Younger, maybe), no.
    • ojbyrne 11y ago
      Unless you're in a bar.
    • etjossem 11y ago
      Toronado has $5 pints of Pliny. So no, the author's totally off mark.
  • mwnz 11y ago
    TBH, the author sounds like he would end up in a place that sells $15 IPA's. That's says more about the author, than SF.
  • acchow 11y ago
    No. I've actually never seen a beer over $12 before. $5-7 is the norm.
• skewart 11y ago
  I can see where this guy is coming from. Though he's obviously exaggerating things by a mile. SF is pretty ridiculous in a lot of ways. But I would take an SF as ridiculous as if everything he said were exactly true over one where there weren't any truth to it. Through all that froth does come actual creativity and innovation. The banana hammock delivery disrupters will fizzle in due time. The people who got inspired by all the energy and potential and decided to build a VR product that revolutionizes medicine will survive. I'd rather see a lot of false positives than risk a couple of false negatives. And besides, it makes for an endless supply of entertaining stories for people aren't from here.
• daenz 11y ago
  I've never lived in SF, but I've talked to companies out there over the years. Then I look at a cost of living calculator and rent prices and quickly write it off. The place sounds like a magnet for talent, no doubt. But the flip side of that is, everyone going to SF leaves other locations talent-starved and willing to be very accommodating.
• emcq 11y ago
  Kind of a weird swipe at bootcamps comparing them to devry. The top bootcamps produce junior engineers better than the average undergrad with more work experience (although in a different field such as mechanical engineering or accounting). Many have STEM degrees from places like Berkeley, Stanford, UMich, UW, UCLA, Harvard, etc. I'd prefer to have their weirdness to the vanilla CS undergrad anyday, and their unique perspectives add meaningful contributions to a team.
  • jessaustin 11y ago
    The only guy I've ever worked with whom I knew to have trained at DeVry was a great sysadmin.
• miseg 11y ago
  > People are spoiled. I'll extend that statement to any of us living the western lifestyle!
• dap 11y ago
  I don't necessary disagree with any of the claims, but it has a very "Old Man Yells at Cloud" sound to it: http://i.imgur.com/91sn32Q.jpg?fb http://i.imgur.com/91sn32Q.jpg?fb
• supergeek133 11y ago
  I've tried to have this conversation with many people on that coast, and there was even a panel at TechCrunch about it. "Do you make your startup people eat more ramen, or do you provide more funding?" As costs keep going up, people STILL think they have to move to SF to get funding or find talent. Yet there is plenty of talent or ideas in other places but the money doesn't move, the dumb part is the VC dollar will go farther in other places. So who's job is it to prompt the move? The idea makers or the money providers?
• NDizzle 11y ago
  I feel like the best reply to this is: "Well, yeah. So?"
• gtrubetskoy 11y ago
  In Austrian business cycle theory, this phenomenon is known as malinvestment, see https://wiki.mises.org/wiki/Malinvestment https://wiki.mises.org/wiki/Malinvestment, there are some historical bubble examples there. The general idea, as I understand it, is that if someone invests and makes a ton of money, then other investors come in trying to do something similar to make a lot of money too, only what they are investing in is no good. But all the money creates a temporary illusion of an economic boom, which is what has been happening in the S.F. Bay area for some time now. I'm old enough to remember the .com bust quite well. At the time the "irrational exuberance" (as Greenspan/Shiller dubbed it) made perfect sense, and the ideas were fundamentally sound, the problem was that investors did not understand that it would take another 10-15 years to get to ubiquitous Internet, and the impatient ones got burned when the bubble burst.
• ctulek 11y ago
  I don't think an engineer being able to take sabbatical or paid well is something to label engineers as spoiled. As long as work ethic is there, this is actually what an employee in any profession should get. That people are paid here well is a result of the huge imbalance of wealth in the world is another discussion topic.
• wooptoo 11y ago
  Replace San Francisco with London and your article is still valid.
• csomar 11y ago
  We have been hearing and reading similarly titled articles for the last couple years. This, however, is the most stupid one in my opinion. What the author describe is a lavish (according to him) standard of living, judged startups to be dumb by their name/description (but they got investor money). He concludes that we are in a bubble. Here are the metrics that matter: * Are current startups generating enough money to pay salaries. * Are current startups raising enough funds to make ends meet. * Are there new startups funded. * Is the number of exits/IPOs higher to create new millionaires. * Is the number of failed startups higher to create new unemployed engineers and free capacity. If someone is interested to know these numbers, maybe finance me for a couple months of research and get the right facts.
  • shostack 11y ago
    I think you forgot another important metric: * Are the startups that are hiring taking up enough of the talent compared to large established companies with billions in the bank such that if there were a bubble, and it were to pop, it would actually make an impact on the hiring environment. I'd love to see some hard data on the % of people employed by the "startup ecosystem" vs. large established giants like Google, FB, Apple, Adobe, MS, Amazon, etc. These companies have MASSIVE hiring needs and will likely continue to for some time. Should interest rates cause lots of startups to die, I have a hard time believing it would result in a similar situation to the last dotcom bust. Salaries might be depressed for a while, but these giants would still be fighting each other to swoop up the talent. I'd seriously love to see some hard data on how much of an economic impact it would have in the Bay Area housing market and the public markets in general if all of the funded startups were to go poof overnight. My current bet is "not much in the scope of things."
    • uglysexy 11y ago
      Hiring is definitely a good indicator of the bubble bursting because hiring indicates that startups are getting funding and they turn around and hire people. When the funding dries up, these same startups tighten the belt, the hiring drops and then the layoffs start. A good indicator of a bubble in SF/SV startups is measuring the IT job market using local Craiglist and Dice job postings since startups heavily use them. I used both websites on & off since the late 90s to find contract & permanent full-time jobs. Back then at the height of the dot-coms, the Dice home page showed 120,000+ jobs, right after the crash (2001-2003) that number fell to around 20,000-30,000. Now it's around 80,000. On Craigslist, at the dot com height, the Software section for the Bay Area (https://sfbay.craigslist.org/search/sof https://sfbay.craigslist.org/search/sof) had so many job postings per day that the list of postings for that day would spill over to the next page (there are 100 listings per page). A year & a half ago (late 2014) there was a good amount of postings and I got a frenzy of replies when I contacted them. Now, there's only a handful of postings per day.
• yanilkr 11y ago
  When you compare that to Detroit trouble, you will see that bubble is not that bad after all. All those overrated engineers will have connections and confidence.
• duren 11y ago
  > People are spoiled. A friend of mine takes an uber to and from work every day, and apparently that is fairly common. Hard to take any of this seriously. Lots of people regularly taxi to work in large cities and I cannot imagine how it's indicative of a bubble. Author seems too emotional about such an assertion.
• jerf 11y ago
  Next up on TechCrunch, "The 'Bubble' Bubble: What It Means To You When It Pops"
• caffeineninja 11y ago
  Written exactly like someone who visited SF from NYC for a few days. The pen is dripping with poison and vitriol.
• pyrrhotech 11y ago
  Can we stop the whole "engineers make a lot of money" spiel? Most engineers make between 120 - 160k in SF, where the median household income is 104k. They don't make more than product managers, project managers or even many BART operators. See http://www.mercurynews.com/salaries/bay-area http://www.mercurynews.com/salaries/bay-area if you don't believe me. Sure, they make a bit more than average, but if that's the standard of "a lot of money", you have a totally skewed view of how capitalism works and the wealth gap in the US. Very few engineers are members of the capitalist class, commonly referred to as the 1% that own 40% of the country's assets. Making 50% more than the median is not a lot. Making 500% more is a lot.
  • swalsh 11y ago
    I think a lot of engineers make more money then the value they provide. Last year I worked for 3 different places. I worked at one startup, and one large company on a new product in a new market. Both products were purely speculative plays They did make money, but not enough to support the staff. My pay was not based on how much value I provided, but how much value I could have provided if the products took off (they didn't, thus the 3rd job). All i'm saying is you should look at other markets that have been propped up by speculation... and see what happens when the market corrects. Most of the time they over-correct before finding a new better more stable price.
    • YuriNiyazov 11y ago
      Your pay was based on how much value you provided plus a risk premium for working on something highly speculative that would cause you to work at 3 different places in a year and take a hit on your résumé. You have to understand risk in order to understand that you were not overpaid.
  • shostack 11y ago
    Yeah, this is kind of aggravating. I'm not an engineer, but I know many, and anyone who thinks they are all just living the high life is crazy. With the cost of living they are no doubt faring better than many traditional working class folks, or service industry folks, but let's be real--they aren't just idle rich bathing in tubs of caviar. In fact, while they might be able to purchase a home still, it often times will be quite a bit smaller, more run down, and in a worse neighborhood due to the sheer cost of buying one. And often times they are only buying out of desperation because they don't want to be forced out of the area entirely due to rents beyond their control.
• bobby_9x 11y ago
  I think the problem is that many of the business models of these startups is basically taking VC money and shuffling it around. I've been to many startup competitions in the last couple of years and most of the winners have no business model. For instance, last year, the winner was a startup that was "Twitter with 255 character limit". It think it was awarded $20,000
• tomasien 11y ago
  According to the about page, the author is an engineer at a startup and is on sabbatical. That feels weird given the criticisms leveled in the piece. FWIW I live in New York and prefer it massively to SV, but I mean....
• gragas 11y ago
  >Every food item has to be locally sourced and organic, which seems more important than taste and quality. Ummm... that's the point?
• mwnz 11y ago
  Ugh, don't feed the troll.
  • mwnz 11y ago
    Glancing through the comments, it looks like the troll has succeeded. SF bashing has begun. You don't have to move here, so chill out, people.
• davidw 11y ago
  > People are spoiled I recall when I was in SF in 1999, limo after limo pulling up to what was a pretty ordinary club. I didn't really care how people pissed their money away, but it seemed so bizarre and so detached from reality. I was glad to get out of there.
• matzipan 11y ago
  It still shocks me that Europe hasn't yet built a response to SF. Sure, London's a tech hub, but not anywhere close to SF. Eastern europe has a lot of talented engineers, but lacks capital and know-how on building an international business, places are cheap to live in and so on.
  • vellum 11y ago
    They're too risk-averse. In SV, it's ok to fail. In Europe, it's not.
• AlwaysBCoding 11y ago
  Yes, there are a lot of dumb startups but I'm still not convinced this is a bad thing. Why does every 24-year old have to be changing the world? Imagine you have a 2x2 matrix where the x-axis is positive value added to the world and the y-axis magnitude of impact. You want your job to be in the top right corner, high impact, high value added to the world but there's two ways to get there. You could do something that has high value but low impact like working at a non-profit in DC helping with excel spreadsheets or whatever, you're delivering value to the world but making a very small impact. The other approach is that you could learn how to build a large scalable system for delivering a solution to millions of people first. Maybe you're making the 100th best photo sharing app and it will never add large value to the world, but you're learning how to deliver impactful solutions you just need to figure out how to deliver real value. I'm not sure why there's a bias against the second approach. I lived in DC for five years and most of my friends are doing less interesting things than my friends in SF. Someone who gets experience at a startup that builds interesting technology but never takes off could be the next CTO of a political campaign for all you know. Also, it's a complete myth that San Francisco is expensive to live in. You can leave cheap or expensive in any city. SF has a culture where being poor is totally cool. Everyone gets it, you're in tech you're an entrepreneur etc... There's no pressure to go to nice restaurants for social status like there is in New York. I spend much less money in SF than I did living in DC just because of the lifestyle I'm living. Buying a house in SF is impossible due to the insane prices, but it's really not that bad living in an apartment here. I don't think people are spoiled here, I think your perceptions are off. First, programming takes place entirely inside a persons head. Mental state is really important, and the 9-5 office job with a commute to and from the office every day doesn't work very well for engineering. I like to break up my day into two halves. The first half of the day and the second half of the day, this gives me two discrete time periods where I can do work and I like to take a bike ride in between because I can think about the problems, and then not have to go to the gym later in the day. When I was working for a company in DC there was no way I could have left at 2:00 to take an hour bike ride, even if that's how I work best. I think it's ridiculous to say that people working in their optimal workflows makes them spoiled. And again, it takes probably 3 years to become a high-quality engineer. So I'm not sure what you would want coding bootcamp graduates to do after 3 months, get together and talk about how hopeless life is? I'm glad that people are getting into the industry, the only way you're going to get better is by getting real world experience. So what someone with 8-months experience isn't a great engineer yet? By continuing to get better over the next couple years he will become a better engineer and then be able to add significant value to the world, I'm not sure why you would want to discourage developers from perfecting their craft. This would be like heckling a Med School student for not being a great doctor yet.
• ruok0101 11y ago
  So its a bubble. What do you do about it? Move?
  • hugs 11y ago
    That's what I did in early summer of 2008. I moved away from Mountain View because everything felt over-priced and unsustainable. So I voted with my feet. Hello from Chicago. :-)
    • shostack 11y ago
      Typing this from MV right now having moved from Chicago in 2013. Really wishing I'd moved out here in summer of 2008 as it would likely mean I'd be able to afford much more home than I can right now.
• bischofs 11y ago
  I would rather have too many startups then not enough - I am from Detroit and we would love a more entrepreneurial environment and more investment capital.
• devsquid 11y ago
  LOL, you can tell this article touches on something sensitive from the reaction to it on HackerNews. Its a pretty accurate description of SF, I just doubt NY is any different.
• robbyking 11y ago
  A couple quick notes from a longtime (20 year) San Franciscan: Everything is too expensive Things are expensive, yes, but more so in neighborhoods with high concentrations of new residents, namely SOMA and most of the Mission. You can get an IPA at nearly any of the bars in my neighborhood for $4, and coffee for $2. There are thousands of dumb startups I agree 100%. I've had the (figurative) banana hammock recruiter call me, too, and it's shocking to me how many people are repeating the mistakes of the 90's boom. People are spoiled Don't confuse a small yet vocal minority with the City as a whole. There are still plenty of starving artists, passionate musicians and dedicated activists; they just live in different neighborhoods than they did 5 or 10 years ago. There cannot be these many quality engineers Again, I agree 100%. During the 90's dotcom boom I worked with a web developer who literally didn't know how to write HTML; all his code was copied from other parts of the project. It's not surprising that it's happening again this time around, but as mbesto wrote, they'll eventually leave too when the system weeds them out. All in all, most of these are things long-time San Franciscans dislike about our city, too. What's left to be seen is whether or not enough of the people who made San Francisco a desirable place to live can afford to live here once the tech market cools off.
• ComteDeLaFere 11y ago
  Reading about the number of cowork spaces along the author's short walk reminds me of working for an ecommerce startup during the last dotcom bubble. Our main office was in the NYC Financial District, so every morning I would hop off the 4 train and walk down Wall St. (as mobs of people sped past on their Razor scooters - this was 2001, yo!). One morning, I noticed something odd with a hot dog stand that was set up right across the street from the Stock Exchange. On closer inspection, I realized that the stand had an umbrella that was made up of 8 or 10 colorful segments, and each segment had an advertisement for a different dotcom (which of course was amplified by the numerous billboards, stickers, sidewalk chalk drawings, etc. along Wall St. at the time).
• wambotron 11y ago
  Who cares? If you're not part of the scene there, why does it matter to you? If those people weren't in "silly" startups, they'd probably end up in silly corporate roles. Or even worse, they'd be unemployed and be another strain on the current system. There are a lot of ideas you may find silly but others find interesting enough to spend their working hours to make a success. If you only focus on finances, tons of them will fail. If you look at the experience they'll have doing it, I'm sure some of them will find it was a success. I've worked at a couple startups and I've worked at some big corporations. There are bad coders everywhere. There are bad ideas everywhere. There are also a lot of jealous people who apparently get bent out of shape because people who are not the best engineer ever are making more money than them and getting to take time off arbitrarily. Instead of focusing on how much you think their startup is stupid, or how they shouldn't get time off because they're not as good as you (based on who knows what), why not just focus on what you have, what you do, and what you like? Stop living against them and live for yourself.
• alphonse23 11y ago
  I agree, things are probably too good to be true right now. I really don't think it's fair to blame engineers though. My only advice to people working in this industry is to save your money -- be sure to be keeping your money in an emergency fund of some kind incase something happens. That's my best practical advice.
• scelerat 11y ago
  > people with degrees from devry were joining companies and making big salaries one of the best engineers I've ever worked with has a degree from DeVry. I know many great engineers who don't have CS or engineering degrees. And I know plenty of dummies with lots of letters after their name.
• p4wnc6 11y ago
  Didn't Arcade Fire say this years ago?
• m1117 11y ago
  A bit dramatized, but the concept is good.
• angryasian 11y ago
  The most ironic thing about this article is that it sounds like he's complaining about tall the niceties of living in SF but he himself works at an ad tech company and is currently on sabbatical and wants to write a new blog entry once a day. WTF???
• kelvin0 11y ago
  Well all we need is to look at historical facts to understand what is going on in SF: https://en.wikipedia.org/wiki/The_Mansions_of_the_Gods https://en.wikipedia.org/wiki/The_Mansions_of_the_Gods Seriously though, this movie does touch many aspects related to gentrification and what happens when supply stays the same but demands spikes sharply ... chuckles all around.
• whybroke 11y ago
  Please be aware that moving to the bay area for any reason other than fun will be a serious life mistake. If you move to the bay area in your 20s, by the time you're in your 40s you will have a specific knowledge of a fad language that is 20 years old. But even if you somehow keep up with new tech in your spare time, you will look 40 something and thus be nearly unemployable solely on those grounds. And you simply will be unable to save any reasonable amount of money no mater how many beers you don't drink. Like anyone else in the states, your sole savings would be home equity which you won't have because you won't be able to buy any kind of home in the few years your age makes you employable. If in doubt, for those still in SF, determine the savings of your co workers in their 20s and 30s (who are now near then end of their employability), and whether they rent or own (good luck finding a 50 something coworker to ask). Be aware that you do not leave the bay area rich, you leave it because you can't afford it. And be aware there are few middle aged and effectively no old people there. And beware that 45 is only half way to retirement age.
  • niuzeta 11y ago
    I'm in Canada and every time I consider prospects of getting into United States, comments like this frighten me. More specifically the Valley area for its renowned reputation of tech-oriented culture, and make good earnings. Compared to what I see in, say, Toronto area with bad housing and a bunch of old .NET 2.0 I feel that it must be better there. What I find lacking in such comments, though, is some explanation on why and the suggested alternatives. Would you mind sharing why? Java/C# were the hot things of 10-15 years ago and people still make a living out of it. It sounds like an argument for classic Red Queen problem where the only winning move is not to play.
    • api 11y ago
      There's a happy medium somewhere between the wasteland of legacy "enterprise" jobs (.NET 2.0 and such) and the nutzo SF/SV orbit. I live in Southern California (LA/OC). It's not cheap by any measure but it's within the bounds of economic sanity compared to SF/SV. There are tons of very interesting tech jobs in cutting edge areas like computer vision, AI/ML, the latest web and DevOps tech, and a lot of hardware/EE stuff. There are many other places like this. Canada probably has a few too. Even NYC, which is more expensive than LA, is still "sane" compared to SF when you consider what you get. In NYC car ownership is very optional, which mitigates the high rents, while in SF you must own a car if you ever want to leave the peninsula. I've turned down numerous offers in SF/SV because it just seems economically insane. The housing prices are clearly unsustainable and the OP's comment about it being a "serious life mistake" rings true. The craziness has also priced out much of the interesting culture that made SF compelling in the first place. Edit: I keep hearing about the relentless ageism in SF/SV tech. I don't see so much of it elsewhere. Is it really that bad? If so it seems like a SF/SV thing and not necessarily true everywhere. In that case it might make some sense for young people to spend some time in SF/SV getting into the latest stuff and learning and then bail before 30.
• lubesGordi 11y ago
  Part of the whole venture capital startup game is diversification if investment. VC's expect a lot of their startups to fail (angel investors too), while a few grow and maybe if they are lucky one of them takes off.
• deleted 11y ago
  [deleted]
• outworlder 11y ago
  While I agree with the sentiment, the attitude of the post is appalling. > This reminds me of the first dot com bubble where people with degrees from devry were joining companies and making big salaries Why do you care about where people got their degrees from? What does that have to do with commanding a high salary or not? If the people seem to be overpaid for what they do, fine. But that has nothing to do with their degrees. Or even their abilities.
• uglysexy 11y ago
  I think a good indication of a bubble is measuring the IT job market using Craiglist and Dice job postings. I'd like to ask you all about what you've experienced & seen on Craiglist and Dice that would give you an idea on how good or bad the IT job market in San Francisco (and the Bay Area in general) is or was. I hear conflicting stories of qualified people not able to find jobs after a year of searching (like the SOAP architect below) and on the flip side, of companies not able to find people (the so-called 'IT talent shortage'). I used both websites on & off since the late 90s to find contract & permanent full-time jobs. Back then at the height of the dot-coms, the Dice home page showed 120,000+ jobs, right after the crash (2001-2003) that number fell to around 20,000-30,000. Now it's around 80,000. On Craigslist, at the dot com height, the Software section for the Bay Area (https://sfbay.craigslist.org/search/sof https://sfbay.craigslist.org/search/sof) had so many job postings per day that the list of postings for that day would spill over to the next page (there are 100 listings per page). A year & a half ago (late 2014) there was a good amount of postings and I got a frenzy of replies when I contacted them. Now, there's only a handful of postings per day. I think it'd be good to get an idea of SF/SV IT job market's fluctuation over the years by compiling these data points. I did a Google search for charts with these data points but couldn't find any. If any of you used these two sites anytime from the late 90s to today and remember the # of postings for that specific date or time period, please post. Ideally, month to month data with high interest on data points from 1999-2003 (dot-com bubble) and 2006 to today (credit bubble).
• malandrew 11y ago
  One of the best and most underrated thing about all these crappy startups? It gives a lot of people the opportunity to learn valuable skills on someone else's dime. Those that are good engineers in crappy startups eventually migrate to the unicorns. The shitty startups may not go anywhere, but they allow a lot of young people to accumulate skills that they can take with them to companies that actually need that talent. Without the shitty startups acting as free training wheels, the unicorns would have a much harder time finding quality talent.
• svhoapres 11y ago
  The jobs are all going to h1bs working 168 hours a week for $300.
• svhoapres 11y ago
  The jobs are taken by h1bs working 168 hours a week for $300.
• svhoapres 11y ago
  No one wants to "throw this out there" but I will. SV has been overpriced for decades and it is only the importation of CHEAP h1b labor that has allowed the growth to continue. You know something is a miss when you build ever and ever more future slums being 4+ story apartment buildings resulting in h1bs stuffed 12+ into an apartment paying $3K+ or even more for a 1BR apartment. Americans won't live like that. Or so I hope. If you didn't have h1bs then the jobs most likely would have gone to cheaper parts of the country as the wage costs would have started to rise to levels such that the products couldn't be developed here. Works for me. We have (or had) a choice of allowing IT to be offshored "like everything else" or wreck Silicon Valley making it into a (future) slum. We made the wrong choice.
• scorpion032 11y ago
  Does anybody know of any major open source contributor that lives in SF? I used to be active in the Python/Django community earlier and am getting involved in the JS-React-Redux community. Not only do most people live outside SF, they live in a remote place that you wouldn't have heard about. Software, good software is creative and creativity needs serendipity. The pressure to meet the next funding round criteria or to get an Uber through the traffic hearing my next track not making eye contact with my uber-pooler isn't the best frame of mind conducive to creativity. I'm sure a lot of top CEOs and the top guys in select areas have a great social circle - smartest people who they eat/hangout with, which is very good. But there are also a lot of me-toos, for whom just living in SF is the thing they are achieving that feed their egos.