Only 2 Fortune 500 companies in San Diego County??? (to buy, subsidized)

[docmcstuffin]

Originally Posted by Sassberto

The problem is that the regulatory and high cost of doing business in San Diego (and California) means it is an attractive place to get educated but not as attractive to start a business. Without significant local VC presence I don't see how UCSD can expand beyond the bio-med knowledge-based business cluster that it's already spawned. Most white collar business services will not decide to start up in California anymore and a lot of UCSD grads aren't going to stay in SD to start their startups either - they're going to the Bay Area where the capital is. It's like the Boston / NYC relationship - you go to college and party in Boston, then you get a real job in NY (or increasingly these days, DC)

I agree about the regulatory and cost hurdle here. But it's the same in LA and Bay area as well. I also agree about your analysis of what's happening right now. I'm just pointing out that SD is a very relatively young city. It takes time. Whether SD will become bay area or not, we don't know. How big bio-med and knowledge-based business gets, we don't know for sure. I think it will be quite big. That industry is in its infancy. But only time will tell.

[NYSD1995]

Originally Posted by docmcstuffin

I agree about the regulatory and cost hurdle here. But it's the same in LA and Bay area as well. I also agree about your analysis of what's happening right now. I'm just pointing out that SD is a very relatively young city. It takes time. Whether SD will become bay area or not, we don't know. How big bio-med and knowledge-based business gets, we don't know for sure. I think it will be quite big. That industry is in its infancy. But only time will tell.

I don't disagree, but I think the timeline is potentially many decades out, and San Diego's local government seems particularly inept at attracting and retaining the type of business that grow a high-end economy (via regulation, tax incentive, education and infrastructure development), instead seems more focused on it's historically strong industries - real estate development and tourist & hospitality industry.

[docmcstuffin]

Originally Posted by Sassberto

I don't disagree, but I think the timeline is potentially many decades out, and San Diego's local government seems particularly inept at attracting and retaining the type of business that grow a high-end economy (via regulation, tax incentive, education and infrastructure development), instead seems more focused on it's historically strong industries - real estate development and tourist & hospitality industry.

I totally agree. I didn't mean to say we'll see a change in the next 5-10 years. I was thinking more 10-30 years. As I said, it takes many years for companies to crack the fortune 500 list. I was just pointing out the fact that there's no way SD could have that many furtune 500 companies because of the reasons you stated, especially the education part. But all of that is changing. UCSD is now a top notch research institution and SDSU is doing a decent job churning out MBAs. Both of those institutions I think only reached their strides in the last 10 years or so. So, it'll take sometime to change the landscape. But landscape I think is definitely changing. Especially w/t he projected population growth of 1M people in the next 30 years.

[NYSD1995]

Unfortunately for me, San Diego's economy getting to first-tier status in 30 years means I will be nearly dead by the time it happens. :-(

[earlyretirement]

Originally Posted by Sassberto

Unfortunately for me, San Diego's economy getting to first-tier status in 30 years means I will be nearly dead by the time it happens. :-(

Look on the bright side....at least our kids might be able to someday take advantage of this.

[Think4Yourself]

San Diego produces a ton of start ups but, unfortunately, they usually aim to sell out to larger companies rather than trying to grow a large independent company. That's still an effective economic strategy but it does mean that there aren't many corporate HQs here.

[tonyinsd]

No. First of all, while large businesses are great, it's small businesses that create the majority of jobs in this country.

Second, many tech companies are not large companies. Tech incubators try to create an environment where startups and small companies can find like minded people and the resources to tap into so that they can bring their product to market.

My family friend's company only had about 25 employees when Eli Lilly bought it out.

Originally Posted by SouthCali4LifeSD

Does it bother anyone that San Diego County, a region of just over 3 million citizens, only has 2 of the nation's 500 largest corporations, in terms of revenue? What are your thoughts on this?

San Diego is seen as a research and development mecca, so is that more significant than the sheer number of Fortune 500's?

[S.S. Lazio]

East coast is much better. Closer to capital. Big F500 corps have big, liquid demands. They shred through capital and need it often. I am amazed at how much these corps rely on investment just to fund day-to-day operations.

Most are also public. Proximity to share holders and broad street is strategically important to move forward with decisions.

Take that, combine it with an international presence- it's easier to have a 5 hour difference to keep teams together than an 8. At least you can run a rolling team where the last 3 hours of the day in Europe have the support of the team in the west. Traveling is the same- easier to send a team on a 5 hour direct flight than a 12-14 hour, three stopper.

Just makes too much sense to be there.

[Pedro2000]

Originally Posted by tonyinsd

No. First of all, while large businesses are great, it's small businesses that create the majority of jobs in this country.

Second, many tech companies are not large companies. Tech incubators try to create an environment where startups and small companies can find like minded people and the resources to tap into so that they can bring their product to market.

My family friend's company only had about 25 employees when Eli Lilly bought it out.

The problem with this "small and medium" size business theory is that most of the successful ones, long term ones that provide tons of jobs, usually become because of those large companies. The Bay Area is notorious for tons of people who maybe worked at HP or Apple and now Google, FB, eBay, etc who do the time, get the experience and start their own companies. Those companies wind up being even more successful. If you follow some of the companies that were started, half the people all worked for a couple of companies at one time or another.

The same theory happens on the east coast. When you have tons of huge companies with billions, they tend to create more wealth, they provide tons of jobs, and people leave and start other companies or join new companies.

This theory of "small businesses" is nice, except many small businesses have about 5-10 people. And half the time it's part time work or lower paying jobs just because thats the revenue. They aren't creating tons of jobs. In the Bay Area, some new company who gets 100 Million in VC, can hire 250 people in a year. A new company in San Diego does not have that VC money. So they depend on revenue. And most new companies aren't making a ton of money. So no VC money and not a ton of revenue means not many jobs.

And the biotech industry.... that could take 20 years to make a profit. So it's not really just a young thing.
San Fran and the Bay area has biotech. They've had old school technology since before Steve Jobs was a kid. HP created entrepreneurs. And then it continued with Oracle, Apple, blah blah blah over the years. And now its almost like Stanford is the startup college.

If you ever lived or spent time in San Fran or the Bay Area or even Seattle, San Diego isn't even close. You could go down every corner and find office buildings filled with young companies. Young funded companies who just hired 100 people. Smart people. People being paid six figures. I know of 3 companies who received something like 200 Million in VC capital over the past couple of years and have hired close to 1000 people. All in a year. And the majority of those jobs are over 150K per year. And that's just 3 companies. San Diego doesn't have the same mentality. You don't walk down any blocks and see 100 new companies, funded companies who can hire people, filling office buildings.

So small and medium sized businesses are nice, but they are really only nice when they can hire 100+ people in a year or two. Otherwise you just have small businesses who can't afford to pay 5 people. That's not an economy, that's a family restaurant type of business scenario. Meaning everybody in the family spends their lives trying to make that restaurant run. And in the end, it's a nice story, but it's not exactly a business that's hiring a ton of people. And surely not paying them that well.

[shmoov_groovzsd]

VOSD just published this. Highlights the stronger sectors in SD and not too dissimilar to many great past posts regarding the meat and potatoes here.

http://voiceofsandiego.org/2013/06/2...-makes-a-mark/