[LUAU] Top 10 Best / Worst Cities For Software Developer Pay
Maddog
maddog at heavymetalradio.net
Sat Mar 24 09:12:53 PDT 2007
All that is good but by many standards those with money from the single
family market won't become VC investors. By real estate I meant more along
the lines of hotel, condo and timeshare developers and investors. Even that
market is in decline and we will see the same problems that happened here in
the late 80's and through the 90's when the place was over built and the
market had to absorb the excess. That took 12 years.
Real estate overall is a safe bet. Over time the investment gains in value.
VC investing is much riskier. I think tax breaks and a concentration on
turning out quality software engineers will go a lot farther to help build
an industry. It has been proven time and again to work. In the short run
there are setbacks but in the longrun it is very profitable. Look at San
Diego, Raleigh, NC, and the Boston/Jersey areas. All the technology
companies there were attracted by tax breaks and the universities
concentrating on turning out IP and a workforce.
The VC problem is a large part of the puzzle though and I don't what the
hell can be done about that. The Hawaii Venture Capital Association has
tried to get the state to create a fund but I think the only way to get VC's
here for the second round or to convince some of the RE investors to part
with their cash, is to have matching government funds (for now). How about
you Jim, any ideas? Maybe something can be hatched on this list and passed
on to the governor?
MD
----- Original Message -----
From: "Jim Thompson" <jim at netgate.com>
To: "LUAU" <luau at lists.hosef.org>
Sent: Saturday, March 24, 2007 12:47 AM
Subject: Re: [LUAU] Top 10 Best / Worst Cities For Software Developer Pay
>
> On Mar 23, 2007, at 5:56 PM, Maddog wrote:
>
>> Jim,
>>
>> I think it's a perpetual chicken and egg thing. More companies would
>> consider moving here if the talent pool existed and more software
>> engineers would stimulate more growth of software companies.
>>
>> There are rich people here but it needs to be rich people that are
>> interested in investing in tech companies. Most of our riches are
>> invested in Real Estate. There is not very much venture capital here.
>
> Thats because for the past several years, (starting in 2001, after the
> dot-com crash), Real Estate has been a fairly good investment.
>
> Here are the last ten years of stats for Oahu, based on the state report,
> single-family homes only (no condos, though the condo picture is worse!)
>
> Year Units median % change %change
> Sold price Unit Sales price
> Year/Year yr/yr
> 1997 2,025 $310,000
> 1998 2,495 $295,000 23.3% - 4.8%
> 1999 2,855 $291,000 14.4% -1.1%
> 2000 3,181 $295,000 11.4% 1.1%
> 2001 3.406 $299,900 7.1% 1.7%
> 2002 3,906 $335,000 14.7% 11.7%
> 2003 4,419 $380,000 13.1% 13.4%
> 2004 4,702 $460,000 6.4% 21.1%
> 2005 4,617 $590,000 -1.8% 28.3%
> 2006 4,041 $630,000 -12.5% 6.8%
>
> but look at what happened last year. Home sales were down (a lot) and
> prices mostly flattened. Look around, the "for sale" signs are back
> out, at least
> over here on Windward Oahu. If you graph median price .vs sales, you'll
> see that we've 'nosed over'
>
> Now, for those people who "get out" at or near the peak, what do they do
> with their money?
>
> Bigger house? Some will, but who really wants a bigger, more expensive
> house in a market that is flattening?
> Eject to mainland? Some will, but it sucks there.
>
> Essentially there will soon be a largish pool of cash that needs
> investing. Yes, folks will need someplace 'new' to live, and they'll
> spend some on that, but
> the 'rich' people, the people who can fill out the rule 501 (and 505 or
> 506) paperwork, are the people who become the "investors" (actually
> "limited partners")
> in a VC fund. The guys you meet when you go to pitch your idea are
> typically the "general partners" or their lackeys.
>
> (Perhaps you know all this, but I'll bet that some on the list don't.)
>
> These people are going to find themselves with windfalls off their real
> estate (if they're selling it and goodness knows, a lot of them *are*
> selling it). The Internet
> did not cease when the dot-com bust happened. They all use Google, and
> some of them use (or at least know about) several "web 2.0" companies
> (Flickr, last.fm,
> Odeo, Delicious, Digg, reddit, twitter, ... skype, etc.)
>
> I predict a flight to quality.
>
> That said, there is only "so much" VC (and Angel capital) here.
> Typically the firms in Hawaii aren't large enough to support a second (or
> subsequent) round, other
> than in a non-lead role. This is the stage that crushes VC-funded
> Hawaiian companies, as they are forced to go to California for a lead,
> and the lead doesn't want to
> have to travel to Hawaii for board meetings (etc), so they lead with the
> proviso that the company relocates back to the mainland.
>
> The idea then, is to avoid a second round. Get bought, or get in the
> black, early.
>
>
>> Holy Crap Batman! Did Jim just agree with me?
>
> Were you correct?
>
>> MD
>> ----- Original Message ----- From: "Jim Thompson" <jim at netgate.com>
>> To: "LUAU" <luau at lists.hosef.org>
>> Sent: Friday, March 23, 2007 12:46 PM
>> Subject: Re: [LUAU] Top 10 Best / Worst Cities For Software Developer
>> Pay
>>
>>
>>>
>>> On Mar 23, 2007, at 6:09 AM, Maddog wrote:
>>>
>>>> I think it's more of a supply and demand proposition. There are not a
>>>> lot of software development companies here and worker demand is low,
>>>> therefore employers can pay whatever workers will accept and workers
>>>> have to accept what is offered or not work.
>>>
>>> Why would a bright, motivated college grad go to work for someone else?
>>>
>>> What we need are more startups in Hawaii.
>>>
>>> http://www.paulgraham.com/siliconvalley.html
>>>
>>> Quoting: I think you only need two kinds of people to create a
>>> technology hub: rich people and nerds. They're the limiting reagents
>>> in the reaction that produces startups, because they're the only ones
>>> present when startups get started. Everyone else will move.
>>>
>>> We have a plethora of rich people here. What we need are more
>>> "nerds". If Hawaii could get off its ass and educate more people with
>>> programming skills, in a generation we would have a lot more startups.
>>>
>>> So yes MD, I agree, the solution is "more software companies", but I'm
>>> not sure that getting existing software companies to "move here" is
>>> the right move.
>>>
>>> Jim
>>>
>>>> In some sectors there is a high demand, such as network engineers.
>>>> There are several network integrators that have had to hire workers
>>>> from out of state. Higher demand means better wages and employees
>>>> have the upper hand and can demand more money. The employer has to
>>>> accept the higher salary demand unless he wants to take his chances
>>>> and look outside the state to find someone for less (unlikely).
>>>>
>>>> So if Lingle was to "do something" about the situation, it would be
>>>> to encourage more software development companies to move here, i.e.,
>>>> tax breaks. That would increase demand and competition for better
>>>> workers and would increase salaries.
>>>>
>>>> MD
>>>> ----- Original Message -----
>>>> From: "Jim Thompson" <jim at netgate.com>
>>>> To: "LUAU" <luau at lists.hosef.org>
>>>> Sent: Tuesday, March 20, 2007 9:39 AM
>>>> Subject: Re: [LUAU] Top 10 Best / Worst Cities For Software Developer
>>>> Pay
>>>>
>>>>
>>>>>
>>>>> On Mar 20, 2007, at 7:42 AM, Eric Hattemer wrote:
>>>>>
>>>>>> Jim Thompson wrote:
>>>>>>> Where are the "exports" for Hawaii?
>>>>>>>
>>>>>> I think this is the key question. You can't pay people with money
>>>>>> you don't have. It's not so much about how much are "they" paying
>>>>>> as "who is there that can actually pay?" I think the only way to
>>>>>> solve this problem would be to get more companies with more cash-
>>>>>> earning products to Hawaii. It's not direct, but there's
>>>>>> definitely a small correlation between corporate earnings and
>>>>>> employee salaries. How many giant (Microsoft, Adobe, IBM, Apple,
>>>>>> etc.) software/computer companies have offices in Hawaii? The only
>>>>>> one I can think of is IBM.
>>>>>> -Eric Hattemer
>>>>>
>>>>> Sun has one. I don't know the current status, but they're still in
>>>>> the phone book. It could be an 'e-suite' for a salesperson and
>>>>> perhaps an SE. That said, IBM is unlikely to be doing development
>>>>> here, either.
>>>>>
>>>>> The biggest problem with Hawaii is logistics. While its no more
>>>>> expensive to FedEx from here than from many locations on the
>>>>> mainland, its impossible to ship "overnight" from here. You could
>>>>> setup to do most everything over the Internet, but there is a huge
>>>>> lack of local infrastructure in terms of co- location, etc. Having
>>>>> "lava.net" host my servers just isn't going to cut it.
>>>>>
>>>>> And then there is the simple fact that we're currently 6 hours out
>>>>> of 'sync' with the East Coast, and even California is 3 hours away.
>>>>> If you think that doesn't matter, consider the 'window of
>>>>> opportunity' to speak with customers, suppliers, fellow employees,
>>>>> etc on the East Coast.
>>>>>
>>>>> By the time you're sitting at your desk, with the second cup of
>>>>> coffee consumed, its 8am (haha!) here, and 2pm on the East Coast.
>>>>> They won't want to schedule conf calls past 4pm their time, so there
>>>>> is a mere 2 hours of "overlap" per day. Of course, if you're
>>>>> willing to stay up past 2am, then you can catch them mid-doughnut,
>>>>> explain the issue du jour, and perhaps have a solution by their COB.
>>>>>
>>>>> There is also the none-too-subtle suspicion on their part that you
>>>>> spend every spare moment on the beach, ogling the gender of your
>>>>> choice, or surfing, that you have achieved a state of "permanent
>>>>> vacation", and they are none-too-happy that your off- hours are spent
>>>>> in in a tiki-lit paradise while they return home to either sub-urban
>>>>> blandness or urban blight.
>>>>>
>>>>> After that, you're faced with a workforce that (in the large) isn't
>>>>> technology savvy, (the Microsoft-touting sheeple are as thick here
>>>>> as anywhere), and can't even find the motivation to return to work
>>>>> reliably. ("Sorry I fo'got to call eh...but chu know I always got
>>>>> choke aloha foa ya brah!")
>>>>>
>>>>> All that said, I don't think its impossible to 'do' high-tech here,
>>>>> but its very difficult to 'scale' it.
>>>>>
>>>>> Jim
>>>>>
>>>>> _______________________________________________
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>>>>> http://lists.hosef.org/cgi-bin/mailman/listinfo/luau
>>>>
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