The Bay Area, led by Silicon Valley, has been the global epicenter of innovation for more than five decades. Yet as we approach a pivotal national election, some question whether our region can continue to fight off competition from other technology-rich areas.
There is a certain logic to the concern: The rise of remote work and our region’s high cost of living could push some companies and talent to move elsewhere. But despite the challenges of uncertain times, our economy has remained dynamic and resilient, even as other regions have found it difficult to replicate our success.
To protect that economic strength, we must make sure that the Bay Area is home to the next wave of breakthrough technologies, address the region’s housing crisis and increase access to capital for a diverse set of company founders.
With the next big shift upon us — the rise of AI — our region remains at the center of things. According to Crunchbase, more than 50% of all global venture funding for AI-related startups in 2023 went to companies headquartered in the Bay Area. An entire ecosystem has built up — semiconductor R&D, the development of large language models, and companies working to integrate AI into existing platforms and products.
Beyond AI, we want to be the home of the next transformative technologies — fully autonomous transportation, fusion power, advanced robotics and neural networks, quantum computing and other frontier technologies.
To do so, we must make it easier for startups and other ventures to locate and expand here; provide reliable, clean energy and advanced facilities to support R&D and manufacturing; head off outdated and costly regulations and red tape; and avoid punitive taxes that can change CEOs’ calculus of where to headquarter their businesses.
We will never win the battle for the least expensive region. That’s why we must continue to embrace our strengths and support policies that encourage investment. What’s at stake? Opportunity and jobs, not just for tech but across all industries.
Meanwhile, affordable housing is at the crisis level. We need to dramatically increase the number of housing units in our region and continue to streamline permitting. We should also be open to innovative ideas such as 3D printing of new homes, which has become a reality over the past few years.
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Our biggest cities, facing commercial vacancy rates up to 34.5%, should develop plans to convert office space into mixed-use or residential units. This can help our downtown cores in San Jose, Oakland and San Francisco bounce back. There’s no silver bullet to our housing crisis — it requires an all-of-the-above approach.
Additionally, we need to increase access to capital for company founders from a diverse range of backgrounds. Our region gets anywhere from 25% to 40% of all venture capital investments in the nation. It is vital that Silicon Valley remain a haven for those launching new companies by providing early-stage support, strengthening partnerships with leading universities and academics, fostering development of young leaders, and connecting them to meaningful career pathways.
No other region has managed to replicate the Bay Area’s formula, but we cannot rest on our laurels. As the election approaches, leaders in the public and private sector should work together to ensure that our region continues to be the world’s leading global hub for innovation.
Ahmad Thomas is the CEO of the Silicon Valley Leadership Group.
