Letter from… San Francisco

Johnny Tucker writes from San Francisco - the home of the digital start-up. But is the tide beginning to turn against these icompanies? Raging wage wars to attract the world’s best staff, mean regular Joe’s are being priced out of the city, unable to afford rocketing rent and house prices...


While LA may be a town where every taxi driver is just filling in time waiting for that big film role, up the coast in San Francisco, every Uber driver is working on a new digital start-up.

Uber, which now operates in more than 300 cities around the world, was itself just a San Francisco digital start-up in 2009, UberCab, by Travis Kalanick and Garrett Camp. Transport in this city ranges from vintage tramcars flanked with gawking tourists, through a surprisingly high number of sleek electric Teslar cars (HQ down the road in Palo Alto), to the ever-present tinny rumble of the skateboard (many of them now electric to boot). There are taxis too, but they are crap according to locals, an unreliable law unto themselves - and Uber was born out of irritation for them. This year during a $1bn round of fundraising Uber was valued at $50bn - no wonder everyone is (California) dreaming about a start-up.

Apple is also in Palo Alto, and other ihousehold names from here include Google, Facebook, Twitter, Fitbit, Eventbrite, Pinterest and Airbnb - digital is in the blood in San Fran.

I popped in on the office of a designer who has his fingers in start-up pie - Yves Béhar and his consultancy fuseproject. This intense surfer-dude is of course a household design name, working with everyone from Herman Miller, through Nivea and PayPal (natch, just down the road too, in San Jose) to SodaStream.

He is also CEO of Jawbone and more recently co-founder of august (take it as the month or the adjective - up to you) a new, ahem, start-up looking to take the world of locked doors by storm. Apparently, the vast majority of doors in the US have the same sort of lock, which is compatible with august's bolt on Smart Lock. When linked to its app, will unlock your door using bluetooth, as you approach it.

OK, it's cool, but unlocking a door isn't that much hassle, but you can also do it remotely for say an emergency plumber or even an Airbnb guest. And there are plenty of clever post-rationalised add-ons that make it seem pretty appealing.

The fuseproject office itself, is a hangar-like construction - a former coffin warehouse - with its own independently curated gallery. The space has a stepped seating area for inspirational talks - many from similarly independent, entrepreneurially minded designers such as Tom Dixon and Michael Young, as well as a few surf champions.

Béhar himself is bullish, claiming that designers are the new entrepreneurs and their time has come. He also has a conscience. Fuseproject works on a number of socially minded developmental (for the individual) projects, such as the One Laptop Per Child Foundation, designing a low-cost laptop specifically adapted to children and their environment. He rushes over to his desk and proudly gives me a Rwandan 500 Franc note that features the laptops. This seems to please him more than a lot of the work we have talked about (though he's pretty pleased with that too).

I leave fuseproject and head into the city.

Architecturally, this burgh's skyline is still dominated by the decidedly Seventies Transamerica Pyramid (William Pereira, 1972); less visible and a little way from the city centre are a couple worth visiting: Natoma Architect's hemispherical Congregation Beth Shalom Synagogue (2008) and Rafael Viñoly's - put aside thoughts of the Walkie Talkie - Ray and Dagmar Dolby Regeneration Medicine Building. Norway's Snøhetta has its focus firmly fixed on this city as well, with the opening of the new SFMOMA gallery later this year. The project includes the creation of free, public galleries at ground level, a public space and new entrances to make the building accessible from all directions.

As far as more residential architecture goes the city is in a bit of a mess - a housing crisis is looming as a result of its digital obsession. There are so many major digital companies in this area that the non-digital locals are getting more than a little pissed off. It's fine if you've been here a while and perhaps own one of the colourful old clapboard houses that perch on these preposterously angled roads. The problem is that these companies pay extremely good wages and are attracting people from all over the world. So, property prices in the city are rocketing and those not on the ladder or those looking to rent are getting squeezed out of the city.

The situation is further exacerbated by Airbnb (a start-up in 2008, now worth around $25bn) - or so, many claim, as people are buying up to rent out. This could be seen as ironic, when you learn that Airbnb was born out of a need by two of the city's residents to earn extra cash to help pay their rent.

Recently, something called Proposition F went to the vote by the people of San Francisco. To cut a long story short, Proposition F had become known as the Airbnb Proposition, intended to crack down on short-term rentals, which many see as exacerbating the city's housing crisis. The plan was to reduce short-term rental to 75 days a year from the current 90 if the main resident wasn't living there. The city voted against the plan by 55 per cent. Residents also, however, voted overwhelmingly for building more affordable housing.

I dropped in to see the latest incarnation of the Airbnb HQ (see following pages), which incidentally was stormed by pro-Proposition F supporters before the vote. It's a company experiencing, in its own words, hypergrowth, and you can read more about that overleaf. While visiting, I stayed in an Airbnb apartment. It wasn't cheap and although centrally placed, it was in the city's roughest area, Tenderloin. The city's and the country's social problems are writ large here. Every street is teaming with hordes of homeless, many of whom have a disturbingly loud outer monologue. The smell is overpowering, in fact the assault on every sense is visceral.

There's a massive have and have-nada divide here. How can so many people fall through the net? How can so many still believe in the rags-to-riches American Dream? In many ways, start-up fever is a continuing part of the story, and is perhaps San Francisco's latest Gold Rush.

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