This story appears in the February 2019 issue of National Geographic magazine.
Teslas jockey for one of 12 electric-vehicle charging stations in the parking lot. A sea of mostly men gathers in the lobby of the Computer History Museum, some giving each other quick hugs. “How’s my investment going?” one shouts to another across the room. A bell chimes, and it begins to feel like church. The boisterous crowd files quickly into the auditorium and becomes quiet. The doors close. Demo Day is about to begin.
Over the next two days, entrepreneurs from 132 start-ups pitch well-rehearsed two-minute spiels about how they are going to change the world. Turns out, there are countless ways to do that. Radar sensors on bedroom ceilings in nursing homes. Drones that check utility lines. Machine learning for cargo shippers. A laundry-detergent subscription service aimed at men.
On average there’s a future billion-dollar company in every group, Michael Seibel, CEO and partner at Y Combinator, tells the Silicon Valley investors. “Your job is to figure out which one it is,” he says. His firm helps entrepreneurs develop their ideas.

Minds, Money, and Machines
Evolution of
a Revolution
It’s been 80 years since a start-up called Hewlett-Packard was dreamed up in a Palo Alto garage. The networks fueling the subsequent rise of Silicon Valley have included not just those connecting our ever smaller devices
but also the networks of innovators who’ve made it all happen.
43%
Of U.S. venture capital into the internet goes to Silicon Valley
50b
Devices will be connected to the internet by 2020
Analog to
Wireless
Transistors to
Smartphones
From room-size computers to pocket- size smartphones, our technology is getting smaller and more powerful.
Electrical signals of ones and zeros move faster and faster over expanding networks.
1950
0.25
inch
telephone
transistor
Computers “talk” over phone lines through modems originally developed for transmitting Air Force radar signals.
Newly invented
transistors replace
vacuum tubes and
are the first step to integrated circuits—
arrays of densely
packed transistors.
Professors to Coders
From academics such as Frederick Terman—who first encouraged students
to start electronics firms—to today’s
CEOs in hoodies, Silicon Valley’s leaders have been networking.
Shockley Semiconductor Laboratory brings transistor technology to Silicon Valley. A few years later, eight engineers leave to form Fairchild Semiconductor.
ElectronicS Firms
Frederick Terman
knowledge
exchange
Stanford University
Shockley
Semiconductor
departed
Shockley Eight
founded
Fairchild
Semiconductor
Military Money to Venture Capital
Tech dollars flow after electronics
companies such as Hewlett-Packard
win military contracts over
East Coast rivals in 1943.
MILITARY/
VENTURE
CAPITAL
1960
0.1 in
Integrated Circuit
arpanet
Stanford Research Institute is one of
the first two nodes of the U.S. government’s ARPANET, later known as the internet.
Texas Instruments’
Jack Kilby and Fair- child Semiconductor’s Robert Noyce invent the integrated circuit,
or “chip.”
Fairchild Semiconductor is an incubator for talent that leads to more than 120 spin-offs, building a family tree of risktakers and company founders.
Fairchild
Semiconductor
departed
fairchildren
founded
Gordon Moore
Robert Noyce
founded
firms
firms
intel
Venture capitalists start to invest in the region, often sitting on boards and advising firms.
Shockley defectors, including Moore,
form a new transistor company, Fairchild.
VENTURE
CAPITAL/IPO
1970
ethernet
apple-1
Local-area networks
The Ethernet standard is developed at Xerox’s PARC, connecting computers and
printers over local-
area networks.
Apple-1 is one of
the first personal computers; video gaming begins.
Friends Jobs and Wozniak attend meetings of the Homebrew Computer Club and start to work together on what will become the Apple-1.
Steve Jobs
Former
employee
Steve Wozniak
Nolan Bushnell
founded
apple
atari
oracle
3com
Xerox’s PARC lab creates a graphical user interface, with windows and menus, that inspires the Apple Macintosh.
Xerox’s PARC
VENTURE
CAPITAL/IPO
1980
192.168.1.0
tcp/ip
Connecting networks
The TCP/IP standard states how networks should talk to each other, laying a foundation for the internet and World Wide Web.
IBM PC, Apple
Macintosh, and Sun-1 workstations become common.
Doug Engelbart of Stanford Research Institute develops an “X-Y position indicator” that will later be known as the “mouse.” The technology is leased to Apple.
Cisco
adobe
The first cybercriminal hacks into Lawrence Berkeley National Laboratory.
VENTURE
CAPITAL/IPO
1990
www
websites
First public access to the internet
WWW “browsing” software is available from several sources. The most popular early browser is Netscape Navigator.
The World Wide Web (WWW) is born.
Start-ups take advantage of their proximity to Silicon Valley’s venture capital, law, and public relations firms, further raising their profiles in the national consciousness.
Larry Page
founded
Sergey Brin
Stanford students Larry Page and Sergey Brin invent Google in their dorm rooms.
Ebay
netscape
The first private companies attempt to capitalize on the World Wide Web.
paypal
VENTURE
CAPITAL/IPO
2000
192.168.1.0
ipv6
Seamless connection
Each internet-
connected device needs an address; the IPv6 system is created to expand address space as it runs low.
Apple unveils the iPod
and iPhone; Google creates the Android phone.
Mark Zuckerberg and Jack Dorsey create technology that shapes our lives and connects us but that also raises privacy and other concerns.
Mark
Zuckerberg
founded
Jack
Dorsey
founded
Uber
tesla
Silicon Valley’s leading internet companies are publicly traded on the stock market.
Venture Capital and IPO
23andme
VENTURE
CAPITAL/IPO
2010
Internet of things
The Internet of Things concept
refers to a network of devices connected to
the internet and each other, such as
your phone and thermostat.
The IPv6 system can cover up to 340 undecillion (trillion trillion trillion) addresses. 4G mobile networks increase their reach, allowing an explosion of mobile-device use.
Scientists are able to store massive amounts of data on synthetic DNA.
Anne Wojcicki’s 23andMe decodes family history; pools of genetic data help advance medicine.
Anne Wojcicki
VENTURE
CAPITAL/IPO
The symbol of Silicon Valley creativity—the humble garage—is attached to million-
dollar homes.
Manuel Canales, NGM staff. Patricia Healy.
Art: Matthew Twombly
Sources: Martin Kenney, University of California, Davis; Dag Spicer, Computer History Museum;
PwC/CB Insights

Minds, Money, and Machines
Evolution of a Revolution
It’s been 80 years since a start-up called Hewlett-Packard was dreamed up in a Palo Alto garage. The networks fueling the subsequent rise of Silicon Valley have included not just those connecting our ever smaller devices but also the networks of innovators who’ve made it all happen.
43%
50b
Of U.S. venture capital into the internet goes to Silicon Valley
Devices will be connected to the internet by 2020
Analog to Wireless
Transistors to Smartphones
Professors to Coders
Military Money to Venture Capital
From academics such as Frederick Terman—who first encouraged students to start electronics firms—to today’s CEOs in hoodies, Silicon Valley’s leaders have been networking.
Electrical signals of
ones and zeros move
faster and faster over expanding networks.
From room-size computers to pocket-size smartphones, our technology is getting smaller and more powerful.
Tech dollars flow after electronics companies such as Hewlett-Packard win military contracts over East Coast rivals in 1943.
Computers “talk” over phone lines through modems originally developed for transmitting Air Force radar signals.
Shockley Semiconductor Laboratory brings transistor technology to Silicon Valley. A few years later, eight engineers leave to form Fairchild Semiconductor.
1950
Shockley
Semiconductor
0.25
inch
ElectronicS Firms
departed
Frederick Terman
telephone
transistor
Shockley Eight
knowledge
exchange
Newly invented transistors replace vacuum tubes and are the first step to integrated circuits—arrays of densely packed transistors.
founded
Stanford University
Fairchild
Semiconductor
Stanford Research Institute is one of the first two nodes of the U.S. government’s ARPANET, later known as the internet.
Fairchild Semiconductor is an incubator for talent that leads to more than 120 spin-offs, building a family tree of risktakers and company founders.
1960
departed
Venture capitalists start to invest in the region, often sitting on boards and advising firms.
0.1 in
fairchildren
founded
Robert Noyce
arpanet
Integrated Circuit
Gordon Moore
founded
Texas Instruments’ Jack Kilby and Fairchild Semiconductor’s Robert Noyce invent the integrated circuit, or “chip.”
firms
Shockley defectors, including Moore, form a new transistor company, Fairchild.
intel
firms
The Ethernet standard is developed at Xerox’s PARC, connecting computers and printers over local-area networks.
Friends Jobs and Wozniak attend meetings of the Homebrew Computer Club and start to work together on what will become the Apple-1.
1970
Nolan Bushnell
Steve Jobs
Former
employee
founded
atari
Local-area networks
ethernet
apple
founded
3com
apple-1
Steve Wozniak
oracle
Apple-1 is one of the first personal computers; video gaming begins.
Xerox’s PARC lab creates a graphical user interface, with windows and menus, that inspires the Apple Macintosh.
Xerox’s PARC
The TCP/IP standard states how networks should talk to each other, laying a foundation for the internet and World Wide Web.
1980
Doug Engelbart of Stanford Research Institute develops an “X-Y position indicator” that will later be known as the “mouse.” The technology is leased to Apple.
192.168.1.0
Connecting networks
Cisco
tcp/ip
adobe
IBM PC, Apple Macintosh, and Sun-1 workstations become common.
The first cybercriminal hacks into Lawrence Berkeley National Laboratory.
Start-ups take advantage of their proximity to Silicon Valley’s venture capital, law, and public relations firms, further raising their profiles in the national consciousness.
WWW “browsing” software is available from several sources. The most popular early browser is Netscape Navigator.
1990
The first private companies attempt to capitalize on the World Wide Web.
Larry Page
First public access to the internet
www
Ebay
websites
founded
netscape
Sergey Brin
paypal
The World Wide Web (WWW) is born.
Stanford students Larry Page and Sergey Brin invent Google in their dorm rooms.
Mark Zuckerberg and Jack Dorsey create technology that shapes our lives and connects us but that also raises privacy and other concerns.
Each internet-connected device needs an address; the IPv6 system is created to expand address space as it runs low.
2000
Silicon Valley’s leading internet companies are publicly traded on the stock market.
founded
Mark
Zuckerberg
192.168.1.0
Seamless connection
ipv6
founded
Apple unveils the iPod and iPhone; Google creates the Android phone.
Uber
Jack Dorsey
23andme
tesla
The IPv6 system can cover up to 340 undecillion (trillion trillion trillion) addresses. 4G mobile networks increase their reach, allowing an explosion of mobile-device use.
2010
founded
Scientists are able to store massive amounts of data on synthetic DNA.
Anne Wojcicki’s 23andMe decodes family history; pools of genetic data help advance medicine.
Anne Wojcicki
Internet of things
The Internet of Things concept refers to a network of devices connected to the internet and each other, such as your phone and thermostat.
The symbol of Silicon Valley creativity—the humble garage—is attached to million-dollar homes.
Manuel Canales, NGM staff. Patricia Healy. Art: Matthew Twombly
Sources: Martin Kenney, University of California, Davis; Dag Spicer, Computer History Museum; PwC/CB Insights
First up is Public Recreation, which offers group workouts in parking lots and other open spaces to exercisers who pay a subscription. “Our secret sauce is, we don’t pay rent,” says one of the founders.
Is that a big market, I wonder as everyone claps. And what about rain, snow, insects, and high-pollen-count days? But we’re on to the next big idea—container optimization for ports using predictive algorithms. The hush in the room is respectful.
During my years as a reporter writing about Silicon Valley, I’ve learned to stifle the urge to guffaw at business ideas. Billions have been made on start-ups I dismissed as toys, solving problems I didn’t know people had. Maybe if Plan A doesn’t work, Public Recreation can switch to Plan B, like Justin.tv, which started by live-streaming the antics of one person, Justin, then anyone, and then turned into Twitch Interactive, which enables one to watch others play online games. In 2014, Amazon bought it for $970 million.
Maggie Ford, engineering director of the Stanford Solar Car Project, demos a solar car with her team at a September activities fair at Stanford University.
Silicon Valley is a place that is always “fleeing into the future,” says Paul Saffo, a longtime Silicon Valley observer. The entrepreneurs pitching on this Demo Day paint a picture of lives made better by artificial intelligence, augmented reality, robots, drones, and sensors everywhere.
Silicon Valley’s optimism and the pragmatic dreamers who keep it going have long fascinated me. But recently there’s been a sobering-up of sorts.
Responsibility and empathy are the new buzzwords. Silicon Valley knows it is being held accountable for everything: the demographics of its workforce, the industries upended and the pain caused by technology, the hate spread faster because of its social networks, and even the effects of innovation on people here. Even some workers with six-figure incomes have trouble affording housing. And around the world in places such as Bolivia, mining the lithium needed to power the devices Silicon Valley invents is raising concerns about exploitation and the environment.
Technology rules the future, but there’s also a grudging acknowledgment that sometimes in the pursuit of making things better and more efficient, you may be hurting people along the way.
“We are surrounded by people who are dreaming big,” says Anne Wojcicki, co-founder and CEO of 23andMe, the personal-genomics and biotechnology firm. “The reality of Silicon Valley is on the right side of history—whether we like it or not, the world has changed. But those transitions can definitely be hard,” she says. “I think we have a responsibility to all those places that are being impacted.”
Everyone has a dream
“Where is Silicon Valley?” out-of-towners ask me when they visit. There’s no capital city or ground zero. There’s no Hollywood-like sign in the hills announcing Tech Town! With low mountain ranges to the east and west, Silicon Valley is a horseshoe-shaped flatland of offices and neighborhoods. Dazzling at the center are the waters of San Francisco Bay, indifferent to the roar of the traffic clogging the roads or the latest breakthrough from Elon Musk, the chief executive of Tesla and SpaceX. I point visitors to the Facebook thumbs-up “like” sign, next to the company’s expanding headquarters. Facebook doesn’t offer tours, nor do most tech companies.
Of course, that “like” sign might not make everyone happy. We know Facebook’s data policies failed to protect users after a researcher sold personal information that was later used to target us with political ads, and Russian operatives stoked political hostilities in the United States by using Facebook as a propaganda arm. Tech’s epicenter might be the site in Mountain View where one of the inventors of the transistor started a company, a place that Apple co-founder Steve Wozniak visited just to touch the building and see the historical marker there. It can be found in a home on a cul-de-sac in Los Altos, where an Indian-born software engineer tucks her kids into bed and gets back online to work on her start-up. Or it can be found in a recreational vehicle with three flat tires parked near Stanford University, where Jim, a Marine Corps veteran and handyman, lives with his dog, Smokey, and bathes each day with hand wipes.
It’s a much different place from what it was in 1982, when National Geographic wrote about Silicon Valley’s “freewheeling egalitarianism that has replaced the rural pace” and said, “this dynamic growth happens behind a deceptively sedate facade … a monotone sprawl of low, rectangular buildings on which corporate nameplates display fusions of high-technology words that give few clues as to what goes on inside.”
Along winding roads in the surrounding hills where deer feed, one can imagine the people here living at a rural pace. Once the home of apricot and plum orchards, the valley has just last year seen the shuttering of a landmark cherry stand and the closure of Orchard Supply Hardware, which was founded in San Jose during the Great Depression. Yet Silicon Valley can fool you: It looks egalitarian, open, and casual, with CEOs in hoodies and venture capitalists in bike shorts, and it is often whimsical, with workplaces that require people to remove shoes or allow them to bring their dogs.
But it’s serious about its ambition. “People are more interested in your start-up than your actual name,” complains Tristan Matthias, 24, an Australian visitor.
The seeds of Silicon Valley’s appeal today began in the early 1990s. As a reporter arriving then, I thought the place felt kind of dead. The decline of the defense industry at the end of the Cold War and a downturn in the economy resulted in layoffs throughout California. The hot categories were desktop publishing, multimedia CD-ROMs, and video games.
Even the great rebel—Apple—seemed to be in decline. Steve Jobs was gone, having left in 1985 after a dispute with the CEO and board; his triumphant return to the company he founded would happen more than a decade later.
An idea was spreading in the mid-1990s: If people could be connected through computers, lives would change. I visited a school that was trying out connected computers with its students so teachers could send messages to parents through a dial-up modem. America Online appeared with its idea of a digital mall you could visit and order flowers from. It was clunky and hard to use, but something big was percolating.
There was a party happening to the north, in Seattle. Microsoft was making computers useful and becoming rich. In August 1995, Microsoft seemed like the winner in a winner-takes-all tech contest. Its executives danced at midnight outside electronics stores, celebrating the launch of the operating system Windows 95. Meanwhile a bomb of sorts was going off in Silicon Valley.
Netscape, which made “browser” software that allowed users to move around the internet, went public less than a year after its signature product was released. Although Netscape was an unproven company with pages of risks outlined for investors, its stock price closed at $58.25 on opening day, giving the company an instant market value of $2.9 billion.
Netscape’s initial public offering (IPO) was the beginning of what came to be known as the dot-com boom, which saw the creation of great lasting companies such as Amazon and Yahoo!—as well as firms that cratered, such as Webvan and Pets.com.
Excitement over what could be done on the internet—sell makeup, rent trucks, find dates, and more—fueled a speculative stock market. In 1999 more than 400 companies, most of them tech related, went public.
Then the market crashed in 2000. More than 200,000 jobs were wiped out.
Embarrassment. Suffering. And yet: “All those start-ups were right,” Wozniak, Apple’s co-founder, told me. “They were all right about what the internet would do for us. It’s just that you can’t change your ways of life that quickly.”

The High Price of
Living High Tech
Silicon Valley, nicknamed for its early days of silicon-chip innovation and manufacturing, has grown from a techie outpost around Palo Alto to a sprawling Bay Area region of high-tech industries and ever higher housing prices that’s known globally as the ground zero of our digtal age.
Detail
below
San
Francisco
Oakland
San Jose
20 mi
20 km
A typical single-family home costs
about $1.3 million in San Francisco and $750,000 in Oakland—prices perhaps within reach for tech workers earning $123,000 annually on average but not for service-industry workers making $30,000.
Median sale prices of existing single-family homes, 1975–2017
(inflation-adjusted 2017 dollars)
$400,000
0
1975
San Francisco-
Redwood City-
South San Francisco metro division
1985
U.S.
Oakland-
Hayward-
Berkeley
metro division
1995
San Jose-
Sunnyvale-
Santa Clara
metro area
2008
housing
market
crash
2005
2015
0
$400,000
$800,000
$1.2
million
Estimated
monthly
mortgage cost*
Based on median
home sale prices,
August 2018
Median rent
list price
2-bedroom unit,
September 2018
$5,592
$4,720
SAN FRANCISCO
$88,000
Median household income (2012–16)
$2,938
$2,950
OAKLAND
$58,000
$4,257
$3,000
SAN JOSE
$90,000
*Estimate based on A 30-YEAR FIXED-RATE
MORTGAGE WITH A 20% down payment and
4.75% interest rate (DOES NOT INCLUDE PROP-
ERTY TAXES OR HOME INSURANCE)

CRADLE OF INNOVATION AND INEQUALITY
The High Price of
Living High Tech
Silicon Valley, nicknamed for its early days of silicon-chip innovation and manufacturing, has grown from a techie outpost around Palo Alto to a sprawling Bay Area region of high-tech industries and ever higher housing prices that’s known globally as the ground zero of our digital age. Its universities, innovators, and entrepreneurs have transformed the area into a massive engine of wealth. But the prosperity has not reached all, and as the “valley” grows and continues to transform, it is deeply divided along lines of homeownership, wealth, and opportunity.
HOMEOWNERS
High price of entry
RENTERS
Search for affordable housing
Census block group with more owner-occupied housing units than renter-occupied housing units
Census block group with more renter-occupied housing units than owner-occupied housing units
Rental cost as a proportion of median household income (2012–16)
Median
home value (2012–16)
No residential housing
40%
or more
30%
or less
$1 million
or less
$1.5 million
or more
Estimated monthly
mortgage cost*
Based on median
home sale prices,
August 2018
$2,767
$2,250
Median rent
list price
2-bedroom unit,
September 2018
SAN LEANDRO
$64,000
Median household income (2012–16)

CRADLE OF INNOVATION AND INEQUALITY
The High Price of
Living High Tech
Silicon Valley, nicknamed for its early days of silicon-chip innovation and manufacturing, has grown from a techie outpost around Palo Alto to a sprawling Bay Area region of high-tech industries and ever higher housing prices that’s known globally as the ground zero of our digital age. Its universities, innovators, and entrepreneurs have transformed the area into a massive engine of wealth. But the prosperity has not reached all, and as the “valley” grows and continues to transform, it is deeply divided along lines of homeownership, wealth, and opportunity.
HOMEOWNERS
High price of entry
Census block group with more owner-occupied
housing units than renter-occupied housing units
Median
home value (2012–16)
$1.5 million
or more
$1 million
or less
RENTERS
Search for affordable housing
Census block group with more renter-occupied
housing units than owner-occupied housing units
Rental cost as a proportion of median household income (2012–16)
40%
or more
30%
or less
No residential housing
Estimated
monthly
mortgage cost*
Based on median
home sale prices,
August 2018
Median rent
list price
2-bedroom unit,
September 2018
$2,767
$2,250
SAN LEANDRO
$64,000
Median household income (2012–16)

Detail
below
$4,257
$3,000
San José
State University
$9,473
A closer look at poverty
Poverty rates in Bay Area regions
can be nearly 19 percent, double the
official rates, according to the Califor-
nia Poverty Measure, an index that
factors in regional differences in
housing costs and noncash benefits
such as food stamps.
$5,467
Direction
of view
SAN JOSE
$90,000
$3,100
San Francisco
$3,350
SANTA CLARA
$103,000
$7,094
42 miles
(68 kilometers)
CUPERTINO
$148,000
$4,632
$10,349
$3,600
San Jose
$2,690
SUNNYVALE
High-tech hub
Thirty-three Fortune 500
companies, including Facebook,
Apple, Netflix, and PayPal, as well
as other top high-tech companies,
are based in the Bay Area.
Wealthy enclaves
Many of the most expensive
homes are nestled among the
foothills on the peninsula.
Several tech-giant headquarters
are a short commute away.
FREMONT
$112,000
MOUNTAIN
VIEW
$109,000
$3,727
$4,500
$2,470
PALO ALTO
$137,000
EAST
PALO ALTO
UNION CITY
$92,000
Stanford
University
$2,754
MENLO PARK
$2,210
ATHERTON
HAYWARD
$68,000
REDWOOD CITY
Lower rents but poorer renters
Rents are cheaper in Oakland than
across the bay in San Francisco, but
residents’ typically lower wages trans-
late into a higher portion of their
earnings going toward housing costs.
Counting the costs
A typical single-family home costs about $1.3 million in San Francisco and $750,000 in Oakland—prices perhaps within reach for tech workers earning $123,000 annually on average but not for service-industry workers making $30,000. The highest home values of all are in Atherton, with a median approaching $7 million. Compare that with the median cost of a home in the U.S.: $217,000.
$2,767
$2,250
$5,676
$3,730
SAN LEANDRO
$64,000
SAN MATEO
$96,000
Controversial commute
Some argue that shuttle services
that help tech workers commute
to the suburbs are further exacer-
bating housing costs in urban areas
such as San Francisco.
OAKLAND
INTERNATIONAL AIRPORT
San Francisco Bay
$4,257
$2,600
SAN FRANCISCO INTERNATIONAL AIRPORT
$2,950
$2,938
$4,757
$3,400
Median sale prices of existing single-family homes, 1975–2017 (inflation-adjusted 2017 dollars)
ALAMEDA
$83,000
UC Berkeley
Higher rents but richer renters
Although mostly covered by rent control laws,
San Francisco is still among the most expensive
rental markets in the U.S. Wealthy renters are
often able to spend less than 30 percent of
their income on rent.
OAKLAND
$58,000
$5,091
SAN BRUNO
$89,000
$3,100
2008 housing market crash
$1.2 million
SOUTH
SAN FRANCISCO
San Jose-
Sunnyvale-
Santa Clara
metro area
San Francisco-
Redwood City-
South San Francisco metro division
BERKELEY
$70,000
$5,592
$4,720
San
Bruno
Mountain
$800,000
Oakland-
Hayward-
Berkeley
metro division
SAN FRANCISCO
$88,000
Founts of innovation
Students and graduates from
Stanford University and the Uni-
versity of California, Berkeley
have a long history of entrepre-
neurship in the region. Since 2009,
they have founded nearly 3,000
companies and raised more
than $63 billion.
Treasure Island
$400,000
United States
Angel Island
Alcatraz Island
*Estimate based on A 30-YEAR FIXED-RATE
MORTGAGE WITH A 20% down payment and
4.75% interest rate (DOES NOT INCLUDE PROP-
ERTY TAXES OR HOME INSURANCE)
GOLDEN
GATE
PARK
GOLDEN GATE BRIDGE
0
2015
1985
1995
2005
1975
SOURCES: IPUMS NATIONAL HISTORICAL GEOGRAPHIC INFORMATION SYSTEM, UNIVERSITY OF MINNESOTA; California Association of Realtors; Zillow Group; Bay Area Council Economic Institute; BLS; PPIC; U.S. Census Bureau; Moody’s Analytics
Silicon Valley has its own words that turn failure into something positive. “Iteration” means getting a product on the market without worrying about perfection—the tweaks can come later. “Pivoting” (said without embarrassment) is sharply changing course before the money runs out.
Failure and downturns clear the way for new ideas and new entrants. Google occupies part of what was once the site of Silicon Graphics, Inc., a computer company whose co-founder helped start Netscape. Facebook has updated the old Sun Microsystems campus as it has grown. The attempt to link the internet and television was a bumpy ride. But then YouTube showed up.
The social media era launched. Facebook co-founder Mark Zuckerberg moved to Palo Alto to grow Facebook with its hacker creed “Move Fast and Break Things.” In San Francisco a group of friends and co-workers found a way for people to give updates throughout their day in 140 characters, and Twitter was born.
The great churn of Silicon Valley masks what happens to individuals. For many, innovation’s great “creative destruction” cycles are not observed from 30,000 feet but are wrenching on a personal level. Jobs lost. Skills made obsolete. Households and families upended.
Apple offered another template: the comeback. With Steve Jobs back in the driver’s seat in 1997 after the company bought the other firm he started, NeXT, Apple began a slow recovery. The company released the iPod and then its digital entertainment store, iTunes. The iPhone launched in 2007, delivering on the promise of General Magic’s Magic Cap and Apple’s Newton more than 10 years earlier. Fast-forward to today, and tech companies are grappling with their dramatic impact on people’s lives. Their leaders have been called to Congress to testify about the use of customer data, the ways foreign actors have used these prized technologies to disrupt elections, and potential bias in the algorithms that control what we see.
With the advent of artificial intelligence—computers learning to think like humans—data (with its partner, computational speed) has become the most important resource. The new oil. If computers can “think” one day and make decisions, then what?
After more than 3,000 of Google’s employees signed a letter in protest, the company chose to not extend its contract with a Department of Defense project that uses artificial intelligence to analyze drone images. Then, in November, 20,000 Google employees worldwide walked out to protest the company’s handling of sexual harassment and pay-equity issues. Salesforce created an Office of Ethical and Humane Use of Technology following criticism of its contract with U.S. Customs and Border Protection.
I visit John Hennessy, a former president of Stanford University and now chairman at Alphabet, the parent company of Google. He is congenial but not in a relaxed, academic way. The tech industry’s current moment of reckoning is spurring deeper questions about Silicon Valley’s purpose, he says.
“The tricky thing right now is for companies to figure out how they’re going to take responsibility and govern themselves in ways that are seen as aligned with not just the interest of their shareholders but also the interest of society broadly,” he says.
The start-up life
The young out-of-towners keep coming.
“You sit in a coffee shop and hear a pitch and people talking about crypto and Google, and that’s a turnoff for some people. But I like it,” says Shriya Nevatia, a product manager from upstate New York who left Boston after graduating from Tufts University.
In three years in Silicon Valley, Nevatia is on her third job. “It sounds bad, but I prefer tiny start-ups,” she says.
In a leafy Palo Alto neighborhood, Joshua Browder sits poolside at the home where Facebook’s Zuckerberg stayed in the summer of 2004 as the social media site was taking off. Inside the house, Browder’s colleagues work at a dining room table on his company’s app—DoNotPay—which is like a robot lawyer fighting parking tickets and finding price loopholes for airline and hotel bookings. The condition of the kitchen—a pan caked with tomato sauce—is just part of the gestalt of the hacker life: living, working, eating, and sleeping in one place as they race to launch the product. The past and present are entwined in tech legends—people who live, work, and invest in tech. Wozniak is a sought-after speaker, getting well over a thousand invitations a year. Part of his appeal is that he’s the “other Steve” in Silicon Valley’s favorite origin story, the creation of Apple. Woz, as he is known, may be a genius, but he sees himself as a regular guy. He retells one of the most famous stories about himself: Around the time of the company’s IPO in 1980, he sold some of his Apple stock at pre-IPO prices to about 80 employees.
“I have a lot of concerns about the distribution of wealth,” he says.
The ‘bro culture’ endures
This is Immigrant Valley today as much as Silicon Valley. The influx of foreign-born people is helping to offset an outflow to elsewhere in the U.S. In some fields, such as computers and mathematics, foreign-born workers now make up more than 60 percent of the workforce. The figure is even higher for women in those fields—78 percent are foreign-born. Indians, Chinese, and Vietnamese are the main groups of foreigners in the region’s tech industry, but people come from dozens more countries: There were 42 people from Zimbabwe working in tech in 2015 and 106 from Cuba.
The international nature of Silicon Valley means companies, even small ones, have become a jumble of cultures and languages. But it also highlights who isn’t making it into the Silicon Valley dream. On average African Americans and Latinos combined make up just 12 percent of the workforce at major tech firms. Women also are vastly underrepresented in what has been called Silicon Valley’s “bro culture”: Slightly more than 30 percent of the workforce at Google, Apple, and Facebook is female. A survey released last September found that women make up just 13 percent of start-up founders and hold only 6 percent of founder equity.
But women are also slowly gaining traction. In 2018, women made up 24 percent of technical jobs and 18.5 percent of firms’ leadership, according to a survey of 80 U.S. companies by AnitaB.org, a nonprofit that works to increase women in tech fields.
When it comes to pay, women in tech are offered less than men more than 60 percent of the time for the same role (with an average gap of 4 percent), according to a report by Hired, a job-hiring firm. Major tech companies say they want more diverse teams, but it’s hard to change employee demographics quickly.
“I’ve heard young women say Silicon Valley is bad for women, and they brace themselves for it,” says Shriya Nevatia, the product manager, over a cup of tea. She has created a group called the Violet Society to help women and nonbinary people during the first 10 years they are in tech, to help get start-ups going. She’s intrigued by the wide networks men have developed during college, through roommates, and in their early careers. Companies, seemingly founded through what seem like chance connections, actually arise from these networks. “We need more women for happenstance,” says Nevatia, who wants to bring women together in the same way.
Squeezed by the boom
As out-of-towners continue to pour into Silicon Valley, driving up real estate and rental prices, many people here who aren’t part of the tech economy—and some who are—see life becoming more difficult, mostly because of the rising cost of housing.
No place is perhaps more squeezed than East Palo Alto, a city of about 30,000 with formidable neighbors: Facebook is just to the north, and Google is to the south. For the past 50 years, the city largely has been a mixture of African-American and Latino families. Now new families, many white and Asian, are moving in. The median home price has already passed one million dollars—up from around $260,000 in 2011, according to Zillow. One million. That’s what passes for affordable housing along the peninsula that stretches from San Francisco to San Jose.
For many longtime residents here who haven’t enjoyed the current tech boom, rents have escalated, and buying a home is out of reach. They move out to the edges of the area, driving for hours each day to and from work. Or they move in with family and friends. Or they leave the area altogether. “They are building one-million-dollar homes right next to homeless shelters,” says Pastor Paul Bains, who with his wife, Cheryl, runs a human-services nonprofit in East Palo Alto.
Patricia Carter lives in East Palo Alto and has a full house: her grown son, his three young daughters under four, and her daughter, plus her son’s ex-partner, who lives in the garage and pays rent. Carter, a UPS driver, faced the threat of foreclosure on her three-bedroom ranch-style home, bought in 2003 for $447,000, but with help was able to save her home.
Michael Seibel, the CEO of Y Combinator, sees a roughly generational shift in Silicon Valley today. Younger workers want their companies to hire diverse employees and act with a bigger social conscience. Firms, desperate to hold on to talent, are falling in line.
And what about his purpose? After graduating from Yale University, Seibel planned to spend his 20s making money, his 30s being a parent, and his 40s going into politics. He moved to San Francisco in 2006 and started a company. He was co-founder and CEO of Justin.tv and Socialcam. Socialcam was sold to Autodesk in 2012, and Justin.tv eventually became Twitch Interactive. Now 36, he just became a father. But politics are out; he feels he has more social impact now.
If Silicon Valley has a spiritual center, it might be the Internet Archive, a nonprofit inside a former church in San Francisco. Servers churn away day and night, archiving much of the public web in its many forms. Nearly every Wikipedia article. About four million tweets a day. More than a half million YouTube videos a week. It’s archived more than 340 billion web pages. The internet’s lost and found.
Fog blowing in through open windows keeps the archive’s servers from overheating.
Scattered among the pews in the archive’s Great Room are more than 120 three-foot-high statues of people who have contributed at least three years to the archive. The internet’s terra-cotta army. I recognize some of them in this eerie but powerful scene.
It’s kind of creepy, these lifelike statues, some holding a book or a cup or a guitar, as if they were interrupted while working on a project or taking part in a sing-along. Or, perhaps, while arguing with each other about the right thing to do.
Michelle Quinn is the Silicon Valley bureau chief for Voice of America and has covered the region since 1994. San Francisco–based photographer Laura Morton is the winner of the 2018 Canon Female Photojournalist Award.