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The continued exodus of Silicon Valley is a warning signal for the way forward for the state, former Cisco CEO John Chambers advised CNBC on Thursday.
“We’re in hassle. We’re a state that’s taking an entitlement strategy, it is not a superb state to do enterprise,” Chambers, who based JC2 Ventures, stated in a “Squawk Alley” interview. “You are seeing many firms fascinated by leaving and, even worse, none of my start-ups are fascinated by coming to California.”
“If California is not cautious, they are going to lose their management and the roles created with it,” he added.
Founders, executives and tech workers of all ranks, who’re usually based mostly in Silicon Valley, have been shifting out of the realm in an exodus sparked by the Covid-19 pandemic. Since they don’t seem to be going into an workplace every single day, individuals are in quest of cheaper lease, extra space and decrease taxes.
Amongst them is Tesla and SpaceX chief Elon Musk, who confirmed final 12 months that he moved to Texas, although his firms nonetheless preserve their main operations in California. Palantir co-founder Joe Lonsdale additionally introduced a transfer from the Bay Space to Austin, Texas.
Some firms are additionally getting on board, both shifting their headquarters or permitting workers to proceed working remotely lengthy after the pandemic ends. Oracle, one among Silicon Valley’s older success tales, modified its company headquarters from Redwood Metropolis, California to Austin, Texas. Hewlett Packard Enterprise introduced it’s going to relocate its headquarters from San Jose, California, to Houston, Texas. Knowledge analytics software program firm Palantir Applied sciences additionally moved its headquarters to Denver, Colorado from Palo Alto, California.
Hordes of founders and buyers, together with Keith Rabois, have additionally not too long ago relocated to Miami, partly resulting from Mayor Francis Suarez’s huge Twitter push.
The Silicon Valley exodus might bode nicely for different states throughout america that may get in on the wealth, Chambers stated.
“Does this chance create alternatives for Texas, North Carolina, Ohio, my dwelling state of West Virginia? Completely,” he stated. “You must create the appropriate atmosphere for start-ups and we have realized that, with the pandemic, you’ll be able to put your sources wherever.”
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