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Pittsburgh Gets a Tech Makeover

135 points| danso | 8 years ago |nytimes.com | reply

148 comments

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[+] pesenti|8 years ago|reply
I lived in Pittsburgh for 17 years. I bootstrapped a company out of CMU, grew it to $25M/year in revenue and sold it to IBM. Pittsburgh is a great place to start a company, lots of tech talent, lots of support and exposure in the community, cheap rent. And it is today a much more enjoyable place to live than 20 years ago (great restaurant scene, bike paths, revitalized downtown).

There are two big drawbacks: finding experienced non-technical talent (our C-suite ended up in DC) and raising significant funds. It's just really hard to get serious VCs to pay attention to Pittsburgh.

[+] theYipster|8 years ago|reply
I've long found a third drawback, which may be linked to the access to capital issue, is Pittsburgh's geographical isolation compared to the Bay Area and other tech hot spots.

There's no major international air hub (anymore) and flights even to nearby cities such as NY, DC, and Philly are relatively pricey with limited schedules. There's no meaningful international service either anymore. This is in comparison to SFO, which has direct international service to many cities in Asia and Europe and fancy flat-bed planes (on the hour) to NYC... Austin has direct service to London and Frankfurt and flights every 30 minutes to mega hubs in Dallas and Houston, and well, New York is New York.

Even by car, the closest nearest city at a two hours without traffic is ... Cleveland, and while Philly, DC, and NYC are drivable, you're looking at 4-5 hours without traffic to Philly or DC and 6-7 hours to NYC if you're lucky. And it's not the easiest of drives either with the winding and truck-filled PA Turnpike.

Even within the metro area, there isn't much outside the downtown core. A few nice suburbs to the north, south, and east, but there isn't anything to the scale of the Bay Area, even with it's housing crunch, nor the Pacific Northwest, nor even Austin / San-Antonio.

In short, it's hard to get to and out of, and while there's an exciting transformation going on, at the end of the day unless someone revives PIT as a major transit hub, it's still going to be a relatively isolated post-industrial mid-western rust-belt city.

[+] 762236|8 years ago|reply
A drawback for us engineers: no moonlighting law. When you work for a tech company in Pittsburgh, they own everything you think and produce, even in your off hours when you're trying to bootstrap that startup. Pittsburgh can never turn into a Silicon Valley with this limitation.
[+] nugget|8 years ago|reply
> It's just really hard to get serious VCs to pay attention to Pittsburgh.

I'm an angel investor in a few dozen tech startups, about half in the Bay Area and half spread elsewhere around the country. The biggest problem with those outside of the Bay Area is that for lack of a better term "they don't think big enough". A lot of the promising ones turn into lifestyle-type businesses (e.g. a focus on services revenue instead of software revenue) when, in my opinion, they could have achieved much greater exits. Whether justified or not, I know many other investors with a similar bias based on similar experiences.

[+] bane|8 years ago|reply
Pittsburgh is a great town. It looks a bit like it was on the barely winning side of a fist fight, but it has lots going for it:

- Two big, well funded, well respected schools cranking out talent. CMU is one of the top schools in the world for CS.

- Cheap rent

- If you want to buy a house, some really beautiful neighborhoods

- SEI - lots of cyber security talent

- Great food and activities, it's not hard to find plenty of things to do, some innovative areas that are turning around dead warehouse and industrial areas

- Some parts of the city are really beautiful and nice places to be, lots of great parks and so on

But there's some realities that I don't think limit what can come from the city, but rather shape what kinds of businesses should set up shop there.

- Geographic isolation

- Parts of the city can be pretty rough still, rougher than what you might find elsewhere

- hard to bring in quality talent if they aren't being sourced from the schools

- Non-tech talent comes from completely different industries

So I think that if you can shape a business that targets a large domestic market and solves real problems, even non-sexy B2B ones, you can probably grow a thriving business there. You probably won't end up hitting it big on social media, but many B2B problems are billion dollar businesses.

[+] z1mm32m4n|8 years ago|reply
> Some parts of the city are really beautiful and nice places to be, lots of great parks and so on

It's hard to understate this point. Compared with San Francisco, Pittsburgh is much more visibly green. There are trees everywhere, grassy areas abound, and the city itself is nestled in green hills.

San Francisco is full of concrete. The Bay Area is still really brown from the recent droughts. There are certainly people who can overlook this and live perfectly contently. But in Pittsburgh, I don't have to give up the greenery for a city life.

[+] shas3|8 years ago|reply
There's a very similarly sized city on the west coast with similar population, etc.: Portland. It is a good illustration of what can help or harm cities.

Portland lacks anchors like the one put down in Pittsburgh by robber barons. Later philanthropists like Vollum of Tektronix in Portland weren't nearly as effective as Carnegie. Silicon Forest turned out to be a bit of a volatile dud compared to Silicon Valley.

Pittsburgh, on the other hand, has great universities in CMU and U Pitt. Portland's equivalents PDX State, erstwhile Oregon Graduate Institute, and OHSU never reached the heights of CMU or UPitt as they lacked the deep and broad foundation of Pittsburgh's universities.

I like both cities, but just on the basis of Shadyside-Oakland-Lawrenceville-etc. and the intellectual atmosphere there, I love Pittsburgh much more.

Disappointingly, in Portland there's no intellectual atmosphere of any sort.

[+] stcredzero|8 years ago|reply
Pittsburgh is a great town. It looks a bit like it was on the barely winning side of a fist fight

I was born in Pittsburgh, and I have some experience with towns in the region and other rust belt river towns. Maybe I'm biased, but I'd say that Pittsburgh, in its good parts, looks better than most in the region. Also, I'm old enough to know the benefits of the Clean Air Act on that town. Once, you could literally smell when you were getting into Pittsburgh, and the sulfur from coal burning literally made it smell like excrement! (Not exactly, but it was a smell in the same family of smells, due to the sulfur.) Today, there's not a trace of this!

[+] BoysenberryPi|8 years ago|reply
Given that Pittsburgh has a lot of security talent, do you think it is a good idea for someone out of state to apply for security jobs there?
[+] closeparen|8 years ago|reply
Won't cheap rent go away as soon as any substantial number of programmers move in?
[+] joeblau|8 years ago|reply
I moved to Pittsburgh a year and a half ago after living in SF for 5 years and I can say that I really love it here. Food is great, people are extremely friendly, and the town is just a great town to be in. I met a Pittsburgh native and I told him that I've noticed that parts of the city are getting "SFed." A few neighborhoods which no one would be caught dead in 5-10 years ago are suddenly bustling with tech company tees from google, uber, duolingo, ibm, amazon, apple and others. Pittsburghers are very prod of their city, as they should be. I just hope it doesn't reach the level of discourse that we've seen in San Francisco.
[+] sAuronas|8 years ago|reply
Every city in the country has the potential to "SF'ed" - zoning laws make it so. If there is one place we would actually benefit from deregulation (as a country) it would be in eliminating zoning regulation. The places that need it most are the places that attract tech-boomification [sic] (Oakland is another example). A solution would be to encourage even growth across a city through targeting neighborhoods with inclusive development from a fungible pot of funds from the new revenues. This, coupled with expedited approvals and (not-yet-create) anti-NIMBY laws could make shit awesome for every one.
[+] CydeWeys|8 years ago|reply
Can you speak to Pittsburgh's zoning policies? SF makes it nearly impossible to add a significant number of new housing units because the zoning policies don't allow less dense housing to be replaced with larger, taller apartment buildings. Hopefully Pittsburgh isn't like that.
[+] thearn4|8 years ago|reply
As a Cleveland native, I look at Pittsburgh somewhat jealously as a city that is achieving what Cleveland has been slow to do over the last 30 years: find a post-industrial midwestern identity.
[+] tcbawo|8 years ago|reply
Cleveland would do well to create industrial and R&D ties to Pittsburgh. It's relatively close in proximity. Creating a regional tech hub would benefit both.
[+] ntsplnkv2|8 years ago|reply
Football rivalries aside, Pittsburgh and Cleveland would do well to partner more often.

Both are very similar cities, they have more in common with each other than others in the rust belt.

[+] moultano|8 years ago|reply
Case Western has to step up its game.
[+] bennettfeely|8 years ago|reply
There's no need to spell it out, we know Cleveland Browns fans look at Pittsburgh jealously.
[+] javra|8 years ago|reply
Wow, this article really doesn't even at least mention some of the problems this new boom bring. Maybe ask long time residents of neighborhoods like East Liberty, Bloomfield, or Lawrenceville how happy they are that they got driven out by rising rents due to rich techies? The "revitalization" of Pittsburgh might benefit some, most of them relatively new to the city, but gentrification will hurt lots of its populace who will then be forced to live in the sprawl ghettos around the city where crime is already a big problem.
[+] thesmallestcat|8 years ago|reply
What I don't understand is why so many young tech dude(tte)s seem incapable of integrating. Any place that experiences a tech boom will also experience a boom in luxury apartments, $10+ cocktails, tapas bars, on demand laundry and so on. This can't help but to displace the old way of living in an area, even if it does bring jobs.

Is it so terrible to find, vet, and rent a normal apartment, do your own chores, and eat "regular" food (non-organic, probably GMO, the horrors!) from the normal grocery store or the nondescript diner/sandwich shop? And just act like a normal person and not carouse like an idiot having brunch exclusively with your well-heeled friends? I guess it's human nature and has more to do with money than anything else, but so much for software engineer exceptionalism.

[+] sumeno|8 years ago|reply
What's the alternative for those neighborhoods? They weren't exactly in great shape before the tech companies came to Pittsburgh.
[+] dmode|8 years ago|reply
It seems to me that there is an article like this for every city in America and abroad these days. Is Pittsburg really that hot ? The numbers I could find for 2015 was that Pittsburg attracted $437mn in VC dollars, while the Bay Area attracted somewhere around $27bn.

http://www.post-gazette.com/business/tech-news/2015/03/19/Ve...

That is a 50x difference.

[+] chapmindustries|8 years ago|reply
I think you're missing the point that a lot of big tech companies are moving there. Google has 500 employees there and Uber has hundreds as well. I think that using the amount of VC funding a city receives as a measure of how hot its tech is doing is a bit misleading.

Also to compare anywhere against the Bay Area doesn't make sense. The Bay Area is obviously going to beat out everywhere else. It's like someone saying that they built a pretty big wall and then coming in and saying "Yeah but look how big the Great Wall of China is."

[+] hessproject|8 years ago|reply
Remember that Pittsburgh only has a population of 300k. Obviously the Bay Area has a more bustling tech market, but for such a small market Pittsburgh (with an h) is doing pretty well, especially when you factor in how badly it was hit when the steel mills closed
[+] ta201707|8 years ago|reply
Last year I was going through a long and grueling job search after taking time off for family reasons. I was based in the midwest after living around the country over the past decade for my recent three jobs. It was the first time I felt totally untethered and able to look at any US locations for a new job. I work in scientific computing and machine learning, so there were various employment hubs to consider.

Knowing the cost of living on both coasts in large cities, and wanting to be close to my midwest family, I really badly wanted a job in a techie midwest place. Pittsburgh and Minneapolis were the top choices, but I also considered everything I could in Chicago, Madison, Dayton, Ann Arbor, Detroit, Grand Rapids, and a handful of other one-offs.

I have to say I was so thoroughly disappointed by the types of jobs and job offers, particularly salary and compensation -- even adjusting for cost of living -- that it was just not doable.

The companies were pitching the same cramped, over-crowded "collaborative" open offices despite private office space being so much cheaper. The salaries were genuinely around half of what they are in Boston and New York for similar work, probably less than half compared with SF. It seemed that bonuses and significant equity compensation were also pared down.

In the end, I took a new job in New York and decided that living with any of the perfectly workable strategies to reduce cost of living here (mainly, live with roommates however you must to have a short commute) was absolutely worth it to make 2x salary, greater bonus potential, and greater equity, and, realistically, greater chances at career growth.

Don't get me wrong. I actively didn't want this choice and wanted the comfort of Pittsburgh, the possibility of actual home ownership, more private space (except that damn open plan office man), and easy drive to my extended family.

It was just not exonomically attractive to pay the cost of earning roughly 40% of the conpensation for this, especially compounded. Maybe if I am lucky to rise to a senior position in the future and can transfer with less of a pay cut, it would be good.

To put some numbers on it, I am an ML engineer, somewhere between midlevel and senior with about 6 years of experience and a graduate degree, and I was looking for non-management and non-research-focused ML engineering roles across companies like (formerly) Silicon Graphics, Uber, DuoLingo, Google, random start-ups, some finance and insurance firms in Chicago, and PNC Bank outside of Cleveland.

I earned just under 200k at my most recent long-term role in Boston prior to my current role in NYC, not including cash bonus and equity.

The best offer I found out of all the midwest searching was in Minneapolis, at 130k with small anount of equity and no bonus. Every other company suggested that, for their area, pushing 100k was the best they could do.

I've lived in the midwest a lot, and I know that financially, 220k - 250k plus career growth in NYC is probably better, in pure earnings terms, than say 120k in Pittsburgh. Obviously other considerations could make a midwestern city attractive despite lower earnings, but the gap was big enough for me that I decided the cramped city rat race will have to do for now.

My general feeling was that a lot of the new focus on the midwest as a tech job region was more or less a rebranding event, trying to rebrand jobs to enable companies to pay lower salaries and reduced compensation for the same value proposition from the engineer, even after adjusting for cost of living.

[+] autokad|8 years ago|reply
i grew up in pittsburgh, and had to leave because there simply wasn't a job for me - (most of the cmu startups threw my resume in the trash as soon as it wasn't cmu) though that was a long time ago and things have changed.

however, the numbers still show slim pickings. search glass door or any job posting website, you will find that philadelphia (not a tech city) has ~5x the amount of positions available. NYC has 15x. a lot of people retort about per capita openings, but I don't think that matters as much as people think. people do have geographic preferences but also apply to many other cities, and CMU graduates more engineers than pittsburgh has data scientist openings.

as you said, sure you have a 'lower' cost of living, but the jobs in pittsburgh pay significantly less.

pittsbugh is not a walk-able city, its one of the least walk-able ones that I know. Its almost 100% certainty you will need a car if you live/work in the city, and if you normally get around without a car, moving to pittsburgh and needing to buy/upkeep a car will wipe away most of those cost of living savings.

traffic and parking in pittsburgh is a nightmare. you can be in a car and see the building you want to get to, but not make it within 30 minutes.

[+] Game_Ender|8 years ago|reply
You are assuming just because it's Pittsburgh pay from companies like Google, Apple, Amazon and Uber will not be competitive. If there is any discount on salary it's on the 10-15% range, not 50%.
[+] sjg007|8 years ago|reply
Well if it's the best they can do it's they can do. Did you have multiple offers to leverage? Also how big was your network in the area? Sometimes you have to start something as well in some places to get what you want. Anyway thanks for sharing. Nice to hear that Minneapolis is a techie place.
[+] natejackdev|8 years ago|reply
I was there is May for a college visit and It seems to be the next up-in-coming tech center.
[+] smaili|8 years ago|reply
The author seems to place most of the credit for the recent 'boom' on CMU for its rich history in the Machine Learning and Robotics fields. So my question is, what happens when other top universities begin to catch up or even possibly dethrone CMU? Would Pittsburg still continue to attract talent and businesses?
[+] carrendi|8 years ago|reply
I graduated from CMU (SCS) 15 years ago. The school is so far ahead of nearly every other CS school in the world in regard to machine learning/AI, it's laughable to think it will ever be dethroned. They have ties with DARPA and other government agencies that have deep pockets. They've also successfully courted every major tech corporation in the country. I have to applaud their board of trustees/president/provost. They know what they're doing.

The article paints a rosy picture of Pittsburgh, but I remember these types of articles appearing back in 2000. The state of Pennsylvania even had a campaign (commercials, marketing, etc) to try to convince college graduates to stay in the state. It didn't work. Most of the talent will eventually leave. All but 2 of my 30 or so friends from graduate/undergrad left after they finished their degree.

In my last semester I was dying to leave because the weather is absolute shit for half the year. CMU was really the only thing there that was worthwhile to me.

[+] munin|8 years ago|reply
CMU has intense advantages that make that unlikely to occur within the next 50 years.
[+] adventured|8 years ago|reply
> So my question is, what happens when other top universities begin to catch up or even possibly dethrone CMU?

What happens when CMU gains an even greater advantage over other top universities? Will Pittsburgh be able to handle the deluge of talent and businesses wanting to move there?

[+] Hydraulix989|8 years ago|reply
CMU has consistently been ranked #1 in the world for computer science. Generally, university rankings are VERY consistent over time. Harvard isn't going to stop being Harvard any time soon.

Also, "Pittsburgh" is spelled with an "h" at the end.

[+] graphitezepp|8 years ago|reply
It would be folly to not mention Pitt and their place as a top tier medical institution as an aside. It's not just CMU and comp sci making PGH what it is today.