Austin Next 1 Year Anniversary - The Journey and What We Have Learned so Far

Michael Scharf: Is the new innovation powerhouse, not the next Silicon valley, but the first Austin, we are adapting to the future in real time.

Jason Scharf: I'm Jason Scharf, a biotech executive, and early stage investor.

Michael Scharf: And I'm Michael Scharf advisor and board member for multiple private companies.

Jason Scharf: You can call us optimist abundance minded up wing, and even solutionists we see a bright future ahead that can be achieved through innovation and entrepreneurship.

Michael Scharf: In this podcast, we explore Austin superpowers, the people and companies driving our growth and the macro and microtrends that come together to create Austin today.

Jason Scharf: This is Austin next.

Michael Scharf: Hi, and welcome to the one year anniversary show of Austin next. Today, Jason. And I thought we talk about where we're going and what's next. We've had 40 episodes so far, and we have a lot of people to thank, obviously our families, Nick Chamberlain, and every word media, our producer, and all of our amazing guests.

I figured we'd start today with each of us talking a little bit about our favorite three episodes. for me. It's three of the episodes we had early on our first episode with John Butler, where we talked about where Austin's been and how we got set up to become the city. We are today. Marc Nathan, the great connector who talked about the network that we have here and why Austin connects best.

And finally Ross Devol who did our first research episode, where we had more of the numbers in terms of what's happening in. Jas,. What were your three episodes

Jason Scharf: before I jump into one, my three, I find interesting when we look at, you know, our numbers and the episodes that are resonating with the audience, the John Butler episode, which is again, been a year ago, still is constantly listened to.

It's probably one of our top episodes. And it's people are trying to understand what is Austin as they're kind of going through you can't, you can't understand the future before the, the past. And so it's always interesting that that's, that continues to be one of our highest rated and continues. Have a shelf life long beyond the kind of the standard podcast of, you know, a month or two.

When I think about my favorite three, and I want to change the question up a little bit, it's almost the, the three that are resonating with me at the moment. And it's on the other side of the spectrum, right? So it's much more recent episodes. So it really comes down to the Cullum Clark future of city's episode, which was actually our last episode.

The multi hub region with John Garrett from community impact. And then the super regions, the Texas triangle with Ed Curtis. And what we're seeing is the change of how cities and ecosystems connect and converge. And what does that, what does it downtown mean? And what does the periphery cities, is it this sun with the orbiting planets kind of situation that, you know, John had described?

Is it this polycentric geography that Cullum talked about where. It really is. You've got a downtown in each of these cities and they kind of live, work, play environment, and yeah, you kind of commute in to each of these, but how do we then maintain that connectivity? And then you take that exact same question that we're talking about in from Austin to Georgetown to Bastrop right.

And then bring that into Texas triangle. We're talking like, okay dallas and San Antonio and Houston. How do you maintain this interconnectivity and creative collisions when the geography is, is ever increasing? It's not everybody going downtown. And so, so that's the question that's really resonating with me at the moment.

And then also kind of driving what are what's happening then?

Michael Scharf: It's interesting in that everything we thought might have happened when we looked at the pandemic has turned out to be wrong and everything that the pandemic did was accelerate the trends that were already in place. Whether it's hybrid work environment, we used to call it telecommuting, whether it's dependence upon video calls instead of air travel, all that stuff that we saw growing slowly but surely.

it's like somebody little match to a rocket ship in March of 2020. And look at all the things that have happened since then,

Jason Scharf: but you have the pendulum going both directions, right? Like, you know, I take me personally, if you had asked me in 2019, does geography matter? I would've said absolutely. You gotta be in one of these hubs.

If you'd asked me in 2020, I would've said no, which of course is the reason we move. But then at the same time we did move to a hub. So that is something interesting there. And then in 2021, While have spending the last year as a remote worker, I've seen the challenges of work, especially that remote being out of state, right?

Like how do we build collaboration with people that you're not seeing day to day beyond just, you know, having a, a video conference. How do you deal with it from an activity base? If I gotta do a one on one. Great. Zoom's fine. If I wanna do a strategic planning session, that's gonna take eight hours.

Probably don't wanna do that via zoom.

Michael Scharf: No, absolutely.

Jason Scharf: Right. But then it's not something you need to do every day. If you're a specialized equipment, say manufacturing in the lab, that's a kind of a different environment. And so where I'm kind of landing on today is you think about this and it's almost this, this cross between the Texas triangle and the Austin region is when we think about hybrid.

And I always kind of don't like that word because it's, it's so vague. It means it can mean so many different types of things. Is, can I be in the office tomorrow? Is it, is it a situation where like we have an emergency, can I get in the office tomorrow? We have to meet whatever it may be. Well, if I'm in Austin and, and clearly that's a center point.

Well, the answer to that is Houston, San Antonio to Waco. I can do all those that that's just driving. That doesn't count kind of the plane. So it's, it really is kind of something I'm trying to think a lot about is if that's the, let's say that becomes the new region, right. Where you have kind of Austin center and those kind of at the, the tips of this kind of mini triangle.

how do you really kind of get the knowledge and the talent and everything flowing as we have the spread out, but it, but it's what people want. And I think it's, it's how we see the, the trends moving.

Michael Scharf: And the future is the past is prologue. The future is the past, whatever, that's something I used to do. 22 years ago, I used to fly up to the bay area once week for a meeting with a client.

And it was every Wednesday morning. We climbed on an airplane out of orange county when we had our meeting. Worked from 11 to four or 11 to five and then flew back home. So it's absolutely possible with the tools we have today to expand the meaning of where you work and how you have those creative collisions, because you're right.

You're going to need to have that combination of alone time and video conferencing and face to face. If you're a knowledge worker. Obviously, none of that's true in a factory environment. None of that's true in a service environment, but if you're a knowledge worker, that is where we are now. And I think where we're gonna be much more going forward.

Jason Scharf: And then you have the gravity of the local environment. I, I don't know what percentage of people are, are like me in Austin right now where you, you know, we live here. Every everything is here except for physically the rest of the company. Right. And you start having this gravity. I think that over time, if all things being equal, wouldn't you just be at a company that's here versus a company that's that's somewhere else.

And I think you're gonna have that as an interesting talent pool that is going to get back to the geography does matter.

Michael Scharf: I think you're right. You talked about this several times a while ago and. Austin is in a unique situation where we've attracted people who were remote workers. And now we have the opportunity to convert them into Austinites working for Austin based companies,

Jason Scharf: or at least companies that have a stronger regional presence in Austin and understanding that's kind of that you have this kind of talent pool, and I think that's.

Why is that? I mean, getting back to, you know, this is the anniversary episode, right? And we look at what we've observed. And I don't like to necessarily say that we've built out seasons, but if you kind of listen and structure the whole podcast, there's a seasonality form to it. I mean, if you look at, from July to December of 2021, it was very observational.

It was very. We're new and we're gonna look at things at the 50,000 foot level, and what's going on here, right? Trying to understand things. You also could always tell what was on our mind if. There was a good, like, you know, five or six episodes in a row that was Samsung might be coming. Samsung might be coming.

Samsung might be coming in the course.

Michael Scharf: Oh, wait a minute. Samsung's here.

Jason Scharf: Right? Yeah. And it was funny actually, you know, because Sara, those, my wife made this comment that, you know, the other day she's like, oh, and this other semiconductor company is coming it's it's funny how it was. The number one topic for a long time.

And now it's, it's old hat because micron and NXP is adding and you just, all this new, you know, it it's it's once you broke the dam, it's just going.

Michael Scharf: And that's true. In other industries, we are becoming chip city. I hate the term, but not only that, but this is the center of gravity for EVs today. Obviously Tesla, Rivian and others are here and.

So they're here and now their vendors and their partners are coming here as well. And I think the same thing is going to happen as we move out into the healthcare field more. I think the same thing is going to happen with Oracle, expanding their presence in software and databases. And now healthcare, this is definitely a change in Austin in terms of being a poll for other companies, rather than a push a great one, by the way, by folks like, you know, the Austin chamber and the round rock chamber and the other Dallas and everybody else going out and soliciting companies coming here. But now you talk to Ed Curtis of yTexas and. All about, they've made the decision to come here. How do we help them succeed when they get here?

Jason Scharf: Right. You had caterpillar moving to Dallas without any incentives or anything kind of going. I also think it's you see the pull from a talent perspective, that's very much what you had in the bay area. You see also the kind of startups that want to be in the shadow of X, Y, Z company, because I'm here, hopefully that X, Y, Z will buy me.

Right. And I think that's gonna take a little bit longer as a reason as we start getting more unicorns, becoming term companies. Now, to your point, you Oracle Tesla, Dell, you've got some possible major requires here, but I think the other part is the supply chain and the fact that we have such a strong manufacturing base.

That actually pulls another level. Right. So, you know, Apple's manufacturing is all in China. So nobody who is in that realm and the supply chain is moving to the bay area. Right. Versus, okay. Tesla has the Gigafactory here. Samsung has additional you know, chip capacity. So the downstream of companies that are filling those, those needs need to be physically close by. So I think that becomes a further building block as we go.

So wanted to step back. One of the big things we, why we wanted to do this episode was what are our big observations? What have we learned in a year? Right. And if you've listened to it a couple times, we've, we've talked about the Austin superpowers is we've kind of identified them what it makes it unique because I think, you know, pound the table on this, hit it, you know, becoming a broken record is I, I don't wanna be Silicon X, right?

Silicon hill, Silicon beach, Silicon alley. You always are in that position of, well then why don't I just go to the original, right. Instead we wanna be the first Austin. And what does that mean? And how does that create its own flare and things start to look Austin, like, and so it's been over the time that we've identified these it's also been interesting is people have brought up their own secret sauce.

And a lot of times there's some overlap with with these as well, which is always validating that you know, we're, we're seeing something that's there. So what we're gonna do, you know, we'll, we'll, I'll introduce them and we'll kind of dive into them a little bit. One of the things that, you know, if you listen to our, you know, Amber Gunst episode, we've had these same kind of superpowers, but we've recently kind of changed how we're, we're thinking about them.

And so the way that we have thought about them and changed is we're kind of grouping them now, right? If you listen to an old episode that I did with Thom Singer I, I talked about what we are or who we are and what we do. I've changed the framework a little bit now, and we've broken them down to we're calling like the Austin mindset, the Austin environment and the Austin way, and really what those are.

So the Austin mindset, the Austin mindset is. We're living in the future. And what does that mean? That means we are developing innovative technologies and we're deploying them here. We're cool. I think is rather self-explanatory, but we'll go get into, you know, we've got all sorts of amazing events and reasons that people enjoy being here. It gets down to the lifestyle.

When you think about the Austin environment, this is really about, you know, the zeitgeist that's going on. Right? So we have a culture of helping which leads to open networks and collaboration. People want to work together here. Back to what we were talking about in the beginning, we're part of the Texas triangle and more and more, what does that actually mean? And how does that interplay with each other?

The final grouping is we're calling the Austin way and that really is we build kind of back to that same manufacturing, physical product type of situation we're talking about. And then the final is we leverage the power of, and, and how that kind of convergence of everything of talent of ideas of sectors really is a powerful combination. And that's leading us to be some amazing results and makes us really optimistic. We're not naively optimistic. We see the challenges ahead as you kind of said in the beginning, but I think that's really what kind of is driving us, having us forward.

Michael Scharf: So let's take a look at those superpowers in more detail and, and start with the Austin mindset. We are absolutely living in the future. Here. There is no doubt about it. And as Jason mentioned, that's not only building the future, but deploying it here. Great examples, icon 3d. The homes that they're building are here in Austin.

They're gonna be doing these things on Mars. They're gonna be doing these things, you know, all over the place they started here. We're deploying it. I don't think there's a day that goes by if you're in the central business district, downtown in Austin, where you won't see one of those little autonomous delivery vehicles running around the streets, you know, taking stuff wherever they're taking it.

And that's just nothing I'd ever seen before I got here. And it's great that we're deploying that we've got multiple drone products. I mean, let's see capital factory and a couple other folks just opened a new area for drone companies to be able to build and test their drones up by the 360 in the bridge.

And finally, Hey, blockchain NFTs web three. We just had another one of those fairs. If you will here, one of those conferences here talking about where NFTs go and where they come from, I'm really involved in it. Cause I'm on the board of one of those companies. But I will tell you right now that there is no way that we've even scratched the surface of what we're gonna be doing with web three and, and, and the blockchain.

Jason Scharf: I think the first Austin, so Consensus moving here is a great example of that. So it was in New York conference. It's obviously outside of my room a little bit, your New York conference that's been around for about five years, moved to Austin. And one of the first things that they did was say, Hey, We need to be more festival-like.

Like we need to be more like South By because this is the particular Austin flavor. So not only are we having that gravitational pull then in these kind of things, but then they're becoming distinctly Austin.

Michael Scharf: Right. And that ties into obviously that We are Cool Meme. And this is right in line with that old slogan for Austin about keeping Austin Werid.

There is so much going on here south by ACL F1 out at COTA the consumer package goods companies that we have that are Austin based, Austin focused and exporting our culture. I don't care if it's tequila or whole foods. And then of course, Texas football. We've got a growing food scene here, film. And you came up with this one and I hadn't heard about it, Texas, especially Austin is the hub for bachelor and bachelorette parties.

Jason Scharf: I was told this, I have no background in doing this,

Michael Scharf: but no, actually I did look it up and, and it's true.

Jason Scharf: What I think the key with the, with the bachelorette parties is as an example, the, the football at these things is that we, we got to back to the superpowers because of the question. Why do we seem to punch above our weight?

We, we started with calling it the Austin narrative before we talked about the superpowers. Right. And because if you ask anybody on the street, you know, whatever metric you want to use, where did Austin's ecosystem rank right in the us. And, and most people would say five, right. Somewhere around there, just below, you know, New York bay area, Boston LA.

And if you look at the static figures, not the dynamic, right. You know, whether it's VC funding or. We tended to be 8, 9, 10. I think some of the interesting data that's coming out this year as we're having a bit of a divergence, right? Like just using VC funding. The first couple of quarters for VC funding globally is down 20% looking at the data so far, that's gone out, you know, from this year or for this quarter, we're gonna have by far, our biggest quarter ever.

You know, we have, I think our highest is 1.9 billion. Based on my back of the envelope, we're gonna be closer to 2.2, 2.3, because you know, boring company and set point alone is like 1.5 billion.

Michael Scharf: Yeah. And that talks a lot about thing, a thing that we've been talking about quite a bit here, and we're looking at, I'm not gonna use the R word, but we're looking at an economic storm, a brewing, and I don't know if it's gonna hit.

First quarter, second quarter of this year, third quarter and fourth quarter of this year. It doesn't matter. The point is that we're obviously having some rough times economically. And the question for Austin is how best to weather that storm, whether we're gonna weather that storm better than other areas, it looks like we're going to, and how do we come out of that storm stronger than.

I think that we've got so much going for ourselves here and I don't need to be too overly optimistic. Cuz gas prices are almost five bucks a gallon. But if you look at the coast, there's seven bucks a gallon. So yeah, it's hard here, but not as hard. Same thing. We've talked about a lot with regard to housing, we permitted a, just a ton of homes here.

In the Austin Metro area, same amount as the New York Metro, but New York is 10 times the population. So, you know, we're doing that kind of stuff.

Jason Scharf: The strength that we have. And I wanna circle back to why the we are cool is, you know, as we said, we're, we're, we're positioned well, we, we seem to punch above weight.

And what was the reason for that? And I think the, the coolness factor. Has left a strong, positive impression of anybody that touches Austin in some way, right. Or, you know, somebody, whether you are, I mean, I think one of the fact we export people as well. We have, UT is one of the largest, if not always forget it's one or two, and that probably changes on a constant basis, you know, largest universities.

So you have people, you know, UT grads. All over the country you have. So you, you have people consuming our, you know, CPG, alcohol, those things that have the kind of the Austin flavor. So everybody has that positive experience that positive experience. And so there's this natural inclination to when you see the good news, Hey, it's the fastest growing Metro, or it is the job numbers are up or whatever it may be that just permeates into kind of the narrative.

And I think that's one of. The important parts outside of just, yeah. South By and ACL and F1 is all are all fun and cool, but they, how they actually link back to the innovation system, right.

Michael Scharf: They all give people, like you said, a chance to touch Austin and walk away with a smile on their face. The first and second, the third time they come here, eventually they think I want to be part of that.

And gee, that's what we thought. And we came here.

Jason Scharf: Yeah, no, I mean, it's funny because for us, yeah, this is, I always kind of joke. This is the, the fourth time that, you know, Sara and I had considered coming here, you know, between for undergraduate, you know, UT was her second choice for grad school was her second choice.

We almost moved here in 11, 12 for job reasons. And then, so it was just kind of there. And then we, you know, we took that opportunity. Which then leads to the, the next set, right? The Austin environment. What happened when we landed? And I, I really wanna talk about, you know, the, that we have a culture of helping which, what that means with open networks and collaboration.

Right. And it was amazing to me how fast I like to always use the onion metaphor for an ecosystem. Right? If you go the, you know, the layers that go down between, and you know, whether you. Influence money, power, whatever it is, as you kind of go down to the center. Right. And it was amazing to me how fast I descended into the ecosystem and met a whole variety of really interesting people who had strong influence really quick.

And part of that being the, when somebody said they were going to. Make an introduction, 80% of the time they did, which outside of Austin's, I'd be like, that's not the normal hit rate of something like that.

Michael Scharf: No, not at all. And I think I've said this a couple times in the 18 months we've been here and all the people we've met almost without exception, they've been welcoming and willing to help and make those introductions.

And. Coming outta Southern California. You know, the fear was always that they were gonna look at us as, you know, the, the least desirable of all people to come here. No, we don't want to change it. We want to enjoy it. So that,

Jason Scharf: that culture's meaningful. I mean, when I was at south by right, there were a couple of quotes that stood out.

So one, there was a Jim Breyer Michael Dell, and I've said this before you know, Panel and you know, and Jim, I think it was obviously a playoff of Michael's book that recently came out and said, you know, you can play nice and win in Austin, which was different than every other ecosystem.

Michael Scharf: The interesting thing is that, and I've said this a lot.

There are a lot of things about Austin today that remind me of California back in the sixties and what you're describing about being able to play nice and win. Is exactly the way you'd see people describe Silicon valley in the sixties with the Fairchild in the beginning of Intel and everything else.

And there was a collaborative spirit, you know, the home brew PC club has to be the birthplace. I don't know how many tech companies in Silicon valley, but it was that kind of cooperation that grew the valley to be what it is today. And I see it a lot here. Good for us. Keep it up guys.

Jason Scharf: Yeah. I mean, when I was at the Texas unicorns panel and asked the question, what's our secret sauce.

It was, you know, Julia Creek said, it's the lack of pretense. You know, the, the guy from self financial it's James Garvey was like, it's the people. So this real kind of it is this kind of collaborative nature and people willing to go out in a limb, like, I'll call it, you know, Cain from KDT. , you know, I was introduced to him, met him once kind enough to do at the time.

He extended me an invite to a curated happy hour. And I'll just say three different podcast episodes were the result of that. So Cain, thank you for that for that invite and it just kind of shows that the. That kind of extension that wanting to pull people in and wanting to be apart and where the things go.

And I think that's, that's been a strong piece of my journey here, and I think what's also made why the podcast is resonating.

Michael Scharf: Yeah. But I don't want to forget some of the things that make Texas unique, not just Austin and central Texas, because Texas is physically so large. We can talk about the Texas triangle.

We could talk about, you know, Dallas and Fort worth. We could talk about Austin and San Antonio or Austin space, San Antonio, and then Houston to have those kinds of powerhouses in one state is unheard of. And each one has their own specific superpower, if you will. And that makes all the rest of the triangle that much strong.

Jason Scharf: There's a, there's a connective tissue amongst that. So I think the only other, obviously California with LA San Diego and the bay area, but as someone who've spent my entire life there, I obviously have connections and contacts in, in those those areas. But there's not a real connective tissue.

There's not, I know there are people trying to create the SoCal innovation, you know, ecosystem with Santa Barbara to the border. I'll say, as somebody who came from there that doesn't exist.

Michael Scharf: No.

Jason Scharf: And where that comes in here, which was interesting. As I remember, I'll forget this, you know, I put out on LinkedIn, you know, January 1st, 2021, Hey, I'm here.

Anybody know anybody in Austin Love to meet people. Right. And what was interesting is without trying, I met people in San Antonio, Dallas, and Houston. So there was already this kind of, you should meet this person. You should kind of connect in. And so when we've had these conversations with you know, the road trip to Tennessee, to Nashville and Atlanta in the super Southeast, and while, you know, we talked with flyover coalition, the Heartland, all of these kind of super regions, but there's a question of what happens when you leave the state.

Right? There's some. There's enough of a singular environment in the state and Texas, one of the few states that's large enough to do that.

Michael Scharf: Exactly. Yeah. And, and although we used to joke, okay. Pop, geography, quiz folks. Where's the Pendleton wall. For those of you that have been in the armed forces, you know, camp Pendleton's the west coast home of the Marine Corps and it is north San Diego county.

And we used to joke on either side of that wall, that it was a fairly tall wall to get across people in San Diego didn't deal with people in orange county or LA county and people in LA county and orange county didn't deal so much with folks in, in San Diego. I know I was commuting from orange county to San Diego for a little while.

And people didn't realize it was the same distance from my home in central orange county to lax as it was to San Diego airport. So I could take either one of those and I didn't care which airport I used.

Jason Scharf: Well, the funny thing is I think from a distance perspective, they were very, they were much shorter to get to lax from a time perspective.

It's a whole different ballgame.

Michael Scharf: Yes, yes,

Jason Scharf: no. It was funny because when we're moving from LA to San Diego and we lived in orange county for that year. And so, you know, Sara was commuting to LA. And I think she think she had to go 30 miles and I was commuting to San Diego and had to go 70. And there were, we'd leave at the same time.

And there were definitely times I'd beat her back.

Michael Scharf: The connective tissue that we talk about being in Texas doesn't exist in many other places. It doesn't exist on the Eastern seaboard. It doesn't exist in California. I don't think it exists between Chicago and Madison or whatever, Chicago and Detroit.

This is a uniquely Texas kind of, of attitude. I guess we see it because Texas has its own electrical grid and nobody else is on it.

Jason Scharf: There's a lot of that. And, and of course the funny part is we are not talking about obviously west Texas and, you know, I've started to meet some people in Midland and.

How all of that kind of connects together. And I know we talked about that with with Ed, about to have the Texas of the future and the transportation. You needed drones to go from, you know, Waco to Midland delivery, medical supplies. And it, it asked the question of how do we get back to what I'd said with things that resonate?

How do we keep the connective tissue and the collaboration as we are physically spread out.

Michael Scharf: Right. And that's a great segue into the Austin Way.

And the Austin way really is, you know, we build, we've talked about icon in the 3d printed homes. We've talked about housing coming here and, and that's not to say that it's not uncomfortable because we are going through a housing shortage in Texas and house prices.

Aren't what they used to be. But, you know, we have a manufacturing base here and, and one of the powers that come from that manufacturing base is the support of a middle class. Without that middle class areas fail. And we're gonna try to get, you know, a couple of demographers on later on and, and talk. how that happens and, and what what not having a middle class does

Jason Scharf: we get, we build all sorts of things.

Michael Scharf: Exactly.

Jason Scharf: We build chips, we build EVs, we build rockets, we build semiconductors, we build houses. It's all of these different things. That one keep us safer from any individual, you know, kind of recessionary environment to that. But then they're all, it's this new, it's the new level of manufacturing, right?

It's not. You know, it's not the assembly line. It's not Henry Ford anymore. You're doing different things. You're managing the robots. But when you hear about, you know, 60,000 a year jobs straight out of, you know, high school, like that creates a whole different kind of you know, middle class, right.

Michael Scharf: We talked to Garrett at, at Austin community college about the partnership they have with Tesla.

It's I think a 16 week program and Tesla pays for students to go through that program. And if you end up graduating, you've got a job at the Gigafactory. You know, originally, I think when we first were talking about moving, it was gonna be 5,000. Now it's 10,000 or more. And that doesn't include the vendors manufacturing today is going and making sure the robots are doing what they're supposed to be doing in a lot of ways.

And that's not the dirty factory jobs of a hundred years ago.

Jason Scharf: No, there's a, there's a great drone video. It's more, it's the Berlin Gigafactory, but. It reminds me like the SIM the thing I think about the semiconductor factories and, you know, the Tesla factory, they're so clean. Mm-hmm, , it is very kind, you know, steriles not the right word necessarily.

And I, well, on the chip side that is, you see them in the, the has almost the hazmats or whatever, but it's just this kind of, it, it is a very different image than, and then kind of that. And I think that's, you know, we're getting back to kind of that being such an important part and it's continuing, you know, to.

Yeah to move south, right. It was in, you know, the north, the north. Right. And then it was the, the Heartland. And that's one of the reasons I think that when I think about, you know, I don't like Silicon X, but that doesn't mean we can't see symbols. We can't see metaphors or, and you know, I've said this before.

Like I think that there's a possibility that Austin, if I was to compare it. Can possibly be Silicon valley at its peak and Detroit at its peak. Right. And that, and is this,

Michael Scharf: and that's the power of, and, and that's the superpower. And like you said, sector diversity, manufacturing versus service, jobs, and knowledge working.

middle class, along with folks doing very, very well. And unfortunately folks doing not so well, but you look at where we are. Space, life science, consumer package goods, the internet hardware chips services. Who do you wanna talk about? You wanna talk about visa with their campus here? How about meta? How about apple?

By the way apple actually does manufacture one comp specific computer here in Austin. Yeah. It's their lowest volume thing, but it's their only stateside manufacturing. I don't know what's gonna happen when they upgrade that computer, but all of these folks are coming here. All of these folks are building here, even if they don't have a headquarters here.

I don't know how many people, well let's look at Oracle. Oracle started in the valley, started Redwood shores. And now their facility here can hold 6,500 employees and they're building more and they're building more and they move their headquarters here. But if you look at at meta or you look at Google, they're gonna take that amazing new building downtown.

And they're gonna take the whole thing. I don't know offhand, but I'm sure somebody will tell me that Google has X number of people here, and that compares very favorably to what they have in mountain view. and visa has X number of people in the south bay area in California. And they have Y number of people here.

And that compares very favorably. It's interesting because in, in, when we had Ross on for the fourth episode, he went back in terms of his history. He talked about when he was doing consulting for apple. How, when Steve jobs asked him, where should we put this other facility, his first answer in the nineties was Austin and look where, you know, look where apple is now and, and they're still building more buildings here.

Jason Scharf: And I think the, and the gets back to that challenge that I'm I'm concerned about, right. Is the, and is also the idea exchange and the talent exchange, right? Because that convergence, you know, biology and computation Create synthetic biology, which is, you know, engineered biology.

Right? You have business model shifting in different ways. Right.

Michael Scharf: Look at Everly well,

Jason Scharf: right.

Michael Scharf: Yeah. Great example of business model innovation there, right

Jason Scharf: at the core, there's no product necessarily innovation. It's just taking e-commerce to labs and, and that is not at all. Me negating what they, that actually we need more business model innovation in, in life science and, and, and healthtech.

And so one of the things I remember we were talking about with Farshad on the, the Startup Genome, which I think may have been a new data point, I, I may be wrong in this was the importance of he called it legacy, right. That having, it's not just the, the startups, right. This is one reason you and I continuously use the word innovation ecosystem than the startup ecosystem.

Right. Right. Because having these large companies, both as training, as acquirers, as talent as partners all within the ecosystem, it goes, it kind of has that goes back and forth and you need

all of that. Right. And you need, I wanna see, Hey. How does e-commerce work for life science? How do I think about subscription models for electric vehicles?

I don't know, making it up right. But really having those business

Michael Scharf: Ferry is, is doing that.

Jason Scharf: Yeah. So having all of these different kind of modes, both from the technological perspective, both from the business model perspective, the talent coming together, that's that's, I think that, and is so much more of our secret sauce and I think that's one of.

One of the areas that I think some of the, we really outscore and out punch other ecosystems is they end up being extraordinarily dominated by a single, you know, sector, which is, can be good, be the leader of that type of sector. Right. I think we're seeing that, you know, whether we call it consumer internet, web three, I mean, I think web three is kinda the next, that's a lot of what the bay area is becoming.

Right. And so you have the world class institutions of that. And it crowds out a little bit of those things, but now the moment that we have such a, kind of a, a diverse ecosystem of the types of things, you keep that going. Right. And how do we think about those collisions when. Downtown and, and like preview, you know, we're having you know, an episode coming up with the managing director of Gensler to talk about the innovation districts.

And well, if we have a polycentric geography and an innovation district, how do those things kind of work together? How do we get people to talk? I remember Tom singer talked about, used to be able to do the three,

Michael Scharf: three name tag day. Yeah. Yeah. And I was just gonna bring that up.

Jason Scharf: Yeah. And that's. That's not as doable anymore.

Right. So how do we think about that? How do we keep that going? Especially as we keep expanding and then, and it's, and once you solve the Bastrop to Georgetown connectivity, I think the Austin to Dallas is relatively the same model, right. Maybe slightly longer. And I think those are gonna be really the challenges outside of building the infrastructure that we need going forward.

And the, the growth, I don't say problems, the growth challenges that we have. Right.

Michael Scharf: Yeah. And, and. Clearly all the things we've spent the last half hour. So talking about have led to Austin's incredible results. And that makes me, and I think Jason will say the same thing, incredibly optimistic around about Austin's future.

So we always end up with the same kind of questions, but we're gonna split it today into two questions. So first. What's next Austin. And I'm gonna steal this from Marc Nathan in a word more, there's more, that's going to be here in terms of more companies, more headquarters, more great people, more culture and more music.

And one of the things that's going to make that happen. As our startup and innovation ecosystem grows and matures is this great recycling of capital. We're about to see the same kind of thing that people talk about. The first time Dell went public, where they had the dellionaires and they started recycling that money.

We're gonna see that now multiple times over, we've got, I think, 16, 17 unicorns, maybe a couple more now. And you know, as those things reach exits. If everything works well, then they're gonna stay here in Austin and they're gonna want to do their next gig and they're gonna want to have their next act.

And that's just gonna be explosive.

Jason Scharf: So I wanna talk about what's next Austin, next podcast. So, first off, we're gonna take next week. Off's the July 4th week gonna go take a vacation, celebrate the holiday. So there won't be any podcast that. and then, you know, year two starts. We're gonna back with more.

We've got a lot of really interesting stuff already, already set up. We're talking with some interesting people wanting to new topics, new questions, try out some new formats, love to get any feedback. You know, this is our second episode. That's just you and I, and. Do people like this, or should we like stick to interviewing people?

Like , I'm, I'm, I'm, I'm open to whatever, right? We're also gonna try to submit a podcast panel, whatever you wanna call it for the, for south by next year. So we're gonna be going through the panel picker and. We'll definitely be pushing that link out and hopefully for all your, all your support to help us kind of get through that.

Michael Scharf: If you like what we're doing now, imagine what we doing live at south by yeah.

Jason Scharf: Another, another, almost another whole year under our belt of getting better at this. Right. We're talking about starting a newsletter. So, you know, we, we're gonna put into this show notes to this, a link to kind of a survey of what people would want to see in that.

This is not a situation of trying to be, what's already out there. We wanna try to bring other new things. So we're open to all that. And yeah, the biggest thing is, you know, thanks for the support. This has been an amazing year and you know, wouldn't have done this without the people listening and the people who are really supportive both on the audience side and on the guest side and, you know, want your input.

Follow us everywhere and yeah, let's keep going.

Michael Scharf: Thanks much, everybody. You have a great, great independence day week,

Jason Scharf: so what's next Austin. We're glad you've joined us on this journey. Please subscribe with your favorite podcast. Catcher, leave us a review and let your colleagues know about us. This will help us grow the podcast and continue bringing you unique interviews and insights.

Thanks again for listening and see you soon.