April 24, 2024

Life in Bend, Oregon is idyllic for Doug Fulop and Jessie Fischer. The couple moved there last year to work remotely in a 2,400-square-foot house surrounded by trees and convenient to skiing, mountain biking and wineries. It’s an upcycling of their old apartment in San Francisco, and once a stranger entered Mr. Fulop’s home after his lock wasn’t locked properly.

But the pair of tech entrepreneurs are now on their way back to the Bay Area, fueled by a key development: the artificial intelligence boom.

Mr. Fulop and Ms. Fischer are both startups using AI technology and are looking for co-founders. They tried to make it work in Bend, but after an eight-hour drive to San Francisco for hackathons, networking events, and conferences, they decided to move back when their lease expired in August.

“The AI ​​boom is bringing energy lost during Covid back to the bay,” said Mr Fulop, 34.

The couple are among a growing number of boomerang entrepreneurs who see opportunity in San Francisco’s expected demise. The tech industry has been plunged into its worst recession in a decade for more than a year, with layoffs and a flood of vacant offices. The pandemic has also sparked a wave of immigration to places with lower taxes, fewer coronavirus restrictions, safer streets and more space. Tech workers have been among the most vocal critics of the city’s worsening drug, housing and crime problems.

But such a bust is almost always followed by another boom. With the latest wave of artificial intelligence technology — known as generative AI, which generates text, images and videos from cues — the stakes are too great to miss.

investors have Announce According to PitchBook, which tracks startups, $10.7 billion was given to generative AI startups in the first three months of this year, a 13-fold increase from the same period last year. Tens of thousands of tech workers who were recently laid off by big tech companies are now eager to join the next big company. Best of all, much of AI technology is open source, meaning companies can share their work and allow anyone to build on it, which encourages a sense of community.

“Hacker Houses” where people create startups are popping up in San Francisco’s Hayes Valley neighborhood, dubbed “Brain Valley” because it’s the epicenter of the AI ​​scene. Every night someone hosts a hackathon, meetup, or demo that focuses on the technology.

In March, a few days after the well-known startup OpenAI launched a new version of its artificial intelligence technology, “Emergency Hackathon’ Organized by a pair of entrepreneurs, it attracted 200 participants, with almost as many on the waiting list. That same month, Clement Delangue, CEO of artificial intelligence startup Hugging Face, A hastily organized social event on Twitter, Be attracted More than 5,000 people and two alpacas descend on San Francisco’s Exploratorium, earning it the nickname “Woodstock of AI”

Madisen Taylor, who runs Hugging Face and organized the event with Mr Delangue, said its community vibe mirrored that of Woodstock. “Peace, love, building cool artificial intelligence,” she said.

All told, the activity is enough to make someone like Ms. Fisher, who is starting a company that uses artificial intelligence in the hospitality industry, cringe. She and Mr. Fulop were involved in Bend’s 350-person tech circle, but they missed the inspiration, hustle and connection of San Francisco.

“There’s nowhere else like the bay,” said Ms. Fischer, 32.

Jen Yip, who has been organizing events for tech workers for the past six years, said the calm in San Francisco’s tech scene during the pandemic began to change last year as artificial intelligence boomed. At nightly hackathons and demo days, she sees people meet their co-founders, secure funding, win clients and network with potential hires.

“I’ve seen people go to events with an idea they want to test and pitch it to 30 different people in one night,” she says.

Ms Ye, 42, runs a secretive 800-person organization focused on artificial intelligence and robotics called the Society of Artificers. Its monthly events have become popular tickets, often selling out within an hour. “People are definitely trying to break down,” she said.

Another of her speaking series, Founders You Should Know, targets leaders of AI companies, primarily engineers looking for their next job. Ms. Ye said that in the last event, more than 2,000 people applied for 120 places.

Bernardo Acetuno moved his company, Stack AI, to San Francisco in January to become part of startup accelerator Y Combinator. He and his co-founders had planned to base the company in New York after the three-month program, but decided to stay in San Francisco. The community of entrepreneurs, investors and tech talent they found was so valuable, he said.

“If we move out, it will be difficult to rebuild in any other city,” said Mr. Aceituno, 27. “What you’re looking for is already here.”

After years of operating remotely, Y Combinator began encouraging startups in its program to relocate to San Francisco. Of a recent cohort of 270 startups, 86 percent had local involvement, the company said.

“Hayes Valley really became the Valley of the Brain this year,” Y Combinator CEO Gary Tan said at Demo Day in April.

The AI ​​boom has also attracted founders of other types of tech companies. Fintech startup Brex declared itself “remote first” early in the pandemic, closing its 250-person office in San Francisco’s SoMa neighborhood. The company’s founders, Henrique Dubugras and Pedro Franceschi, travel to Los Angeles.

But when generative artificial intelligence started to take off last year, Mr Dubugras, 27, was eager to see how Brex adopted the technology. He quickly realized that he was missing out on coffee, casual conversations and community events around AI in San Francisco, he said.

In May, Dubugras moved to Palo Alto, California, to start working in a new, streamlined office a few blocks from Brex’s old office. San Francisco’s high office vacancy rate means the company is paying a quarter of the rent it paid before the pandemic.

Mr Dubugras, sitting in Brex’s office under a neon sign that says “growth mindset”, says he has been holding coffee meetings with the AI ​​staff since his return. He hired a Stanford Ph.D. The student tutors him on the topic.

“Knowledge is concentrated at the forefront,” he said.

Mr. Fulop and Ms. Fischer said they will miss living in Bend, where they could ski or mountain bike during their lunch breaks. But getting two start-ups off the ground required a strong combination of urgency and focus.

In the Bay Area, Ms. Fischer participated in multi-day events where people worked through the night. Every time Mr. Fulop stops by the coffee shop, he encounters engineers and investors he knows. In addition to San Francisco, they also considered living in suburbs like Palo Alto and Woodside, which offer easier access to nature.

“I’m willing to sacrifice the amazing tranquility of this place in order to achieve my ambitions, be inspired and know that I can meet great people to work with,” Mr Fulop said. Living in Bend, he added, “feels like an early retirement, to be honest.”

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