Why I Made the Move to Texas

Nov 10, 2020

Nov 10, 2020

Some people like to hold up Texas as a model for the country. There is a reason for this. Texas IS a model for the country, which is why I’m moving here. It is open, dynamic, business-friendly, and continues to be a land of opportunity for all people. Whenever I return to Texas, I’m excited about the size and possibilities of the state. Everything is bigger here, including the dreams, even though everything is more affordable here.By contrast, it is hard to exaggerate how bad things have gotten in California. I’m coming from a state where fires burn up larger portions of the land every year, where smoke blankets our cities, where our streets are littered with needles and human waste, where property crime has surged to the highest in the country, where the electricity turns on and off as in Third-World countries, and where a middle class family can never hope to afford a house.

If you’ve listened to the national media, however, you may have thought that it was Texas that was the wasteland and California a model for the future. What if we compare the perception with the reality:

  • California has a reputation for helping the poor, yet 19% of Californians are in poverty, the highest rate in the nation. Texas’s rate is about a third lower. While California claims to be fighting income inequality, it is one of the most unequal states in the nation, much higher than Texas.
  • The number of homeless in California is five times that in Texas, and 3/4s of those homeless are unsheltered in California, the highest rate in the nation.
  • The main reason for this poverty is that California’s cost of living is the highest in the nation, and 80% higher than in Texas. Ask any poor person if they want to cut their income almost in half, and you’ll know why they don’t want to move to California.
  • California has a reputation for being welcoming to all, but for the first time since its creation it lost population at the end of last year. Texas continues to gain over 1,000 new residents a day.
  • In the past ten years California has lost almost a million people to other states. In fact, almost half that number went directly to Texas. In that same period, Texas has added more than 1 and a half million from other states.
  • California has a reputation for being the center of dynamic new businesses. But Texas has created almost 60% more jobs than California since 2008. Relative to its, for now, smaller size, it also has more Fortune 500 companies.
  • California has a reputation for restricting guns and crime, yet the violent crime rate is higher in California than in Texas, and it’s been going up just as Texas’s continues going down. San Francisco now has the highest property crime of any large city in the country.
  • California has a reputation of a successful and liberal education system, but on the national tests, Texan students rank above the national averages, while Californian students rank below them, this despite spending almost 20% less per student. Texas also graduates a higher percentage of low-income high school students and a far higher percentage of Hispanics.
  • California has a reputation for being a green oasis and Texas a polluted nightmare. In reality, The American Lung Association ranks the most polluted cities, and of the top 5, all are in California. No Texas city even cracks the top 10.
  • Somehow Texas manages to achieve all of these great outcomes with some of the lowest taxes in the nation. Texas has a constitutional clause forbidding income taxes at all. Yet California now has the highest income tax in the nation, 13.3%, and they are proposing to add another 3.5 percentage points and a wealth tax to boot. If added to proposed national increases in capital gains taxes, and proposed tax changes on carry, my colleagues would face marginal tax capital gains rates of 60 or 70%, the highest in the free world.
  • Also, if I switch my lights on in Texas, they will come on. In California, who knows. In Texas, I get all the benefits of this 19th century technology whenever I want it.

The reality of Texas and California is almost the opposite of what you hear in the media.

There are many others reasons we left California: its corrupt government beholden to public employee unions; environmental reviews that take a decade of bribing lawyers to build anything; nonsense like AB5, which makes it impossible for new businesses to hire contractors; and the out-of-control state spending. We were also tired of an intolerant far-left in California that would rather demonize opponents than discuss honest differences of opinion.

I am still doing business in California and will keep fighting to help the state. I’m optimistic that over the long-term California can return to the values that made it the dynamic center of global technology entrepreneurship. But, in the meantime, while its bad policies continue, I expect the state to keep losing its top builders and creators. Some of our most prolific and entrepreneurial California friends have moved with us here to Texas, but also to Miami, Jackson Hole, Sun Valley, Nashville, Las Vegas, and other great cities.Back in 2000 or 2010, it made sense to build in San Francisco, since that was where all the talent was. Today, except for a few concentrated fields like biotech, with its specialized PhDs coming out of UCSF, Stanford, and Berkeley, talented people are building top technology firms across the country, which is good news. This will spread prosperity across this great land. We have already been investing in states like Iowa, Tennessee, Oklahoma, Virginia, Florida, Arizona and so forth.

But I’m most excited about the future of Texas. Our venture capital firm, 8VC, already has six companies around Austin with hundreds of employees. 8VC is also opening a major office here – just like in San Francisco, we plan to have the coolest space in Austin. We’re already starting more companies here out of our 8VC internal “Build” program. Who knows what else we will build here to complement our efforts - maybe a new town nearby; maybe a new university. I am still focused on recruiting top talent, but we’re betting that the future of America is going to be built in the middle of the country, in places with good government and a reasonable cost-of-living that allows average income families to thrive. That means, most of all, places like Texas.Texans worry about Californians fleeing their state and bringing their “Californian values” here. But I came here because I love those Texan values, because they are the same American values that made our country great and will one day return to the rest of the country, maybe, even to California. I’m looking forward to helping Texas show the way to the rest of America and the world.









Continue Reading