Yahoo Finance From ‘brain drain to brain gain’: Miami mayor’s plan to turn the city into a tech hub
It all started out with a tweet. Now, Miami Mayor Francis Suarez is hoping to jump start a movement that establishes his city as the next great tech hub.
“What we're doing is, is creating an ecosystem that has grown as an accelerator in the last few days and months and weeks, so that we can make sure that we have an economy that serves not just my generation, but my children who are six and two,” Suarez told Yahoo Finance Live. “When I was 20 years old, we were an intellectual talent exporter. And so we're trying to transfer it from a brain drain to a brain gain here in Miami, but we're looking at our educational system from elementary school, making sure that we're coding as a second language.”
Suarez’s very public courting of tech executives and venture capitalists began back in December, in a response to a tweet posted by Varda Space Industries co-Founder and President Delian Asparouhov, who suggested “Silicon Valley move to Miami.”
How can I help? https://t.co/hIC1k8ka1i
— Mayor Francis Suarez (@FrancisSuarez) December 5, 2020
Suarez’s one-line response “How can I help?” garnered more than 5,000 likes and set in motion a string of meetings and calls to actively recruit some of the biggest tech names from California to the Magic City.
From Eric Schmidt, former Google CEO, to venture capitalist Andreessen Horowitz, rumors have been swirling around who Suarez will pluck from the Bay Area next. Early this week, Suarez reached out directly to Tesla’s (TSLA) Elon Musk, offering to host him at City Hall, to discuss battery cell production. That came, after he offered up Miami as the “prototype city” that would allow Musk to develop The Boring Company’s tunnels to alleviate traffic congestion.
Count me in! No brainer...we would love to be the prototype city. https://t.co/waRwj0dprJ
— Mayor Francis Suarez (@FrancisSuarez) January 18, 2021
Suarez’s public recruitment comes on the heels of some notable exits out of the Valley. Last month, Oracle (ORCL) announced it would be moving its headquarters from Redwood City, Calif. to Austin. That came after Hewlett Packard Enterprise (HPE) announced it would be moving to Houston, and Palantir moved its headquarters to Denver. Even tech billionaires like Musk have followed suit, re-establishing themselves outside of California, all the while keeping a majority of their business operations in the state.
A progressive tax structure, culture clashes, and the new work-from-home environment have all reportedly contributed to the changes. While taxes on California’s highest earners remain the highest in the country, Florida has no income tax. California Gov. Gavin Newsom has maintained one of the most stringent restrictions during the pandemic, but Florida’s Gov. Ron DeSantis has largely adopted a looser policy, without imposing lockdowns in restaurants and bars.
Suarez’s marketing pitch includes a promise to establish “the most advanced crypto laws in America” to eliminating non-compete employment agreements that limit the ability of workers to move between companies within an industry. Suarez said he is also considering additional tax incentives.
“I've never been huge on incentives, but I will say this, I don't want to lose a competition to another part of the country, because we're not competitive on incentives,” he said.
Still, the amount of venture capital funding spent in Miami remains a trickle, compared to the flood in Silicon Valley. According to PitchBook, the city attracted less than 1% of all venture funding present in the U.S. last year. And while the allure of lower taxes may attract the richest tech entrepreneurs, Miami faces many of the same challenges that have plagued communities around the Bay area, including affordable housing and the impact from climate change. Rising sea levels have exacerbated an affordable housing crunch, as residents flee flood-prone communities, and developers eye property in high elevation, low-income neighborhoods.
Suarez said the promise of newer, higher paying tech jobs won’t come at the expense of affordable homes.
“The city of Miami, with its form-based land use code has the ability to grow, 10X, basically 1,000%, in terms of its growth,” he said. “We have the ability to grow significantly so we can keep prices down by creating supply.”
Akiko Fujita is an anchor and reporter for Yahoo Finance. Follow her on Twitter @AkikoFujita
