How San Francisco Became the Tech Startup Hub

For over fifty years the fast paced and dynamic Silicon Valley has been considered as the world’s leading technological hub for innovation and invention. In 2008, an era of doubt hit the American economy in the form of the Great Recession. The job market shifted to the San Francisco area allowing it to become the new central hub to technology startups.

The 90’s Tech Boom

With less than 1% of the city’s population working in technology, San Francisco was mainly a residential area. Most citizens worked in Silicon Valley and would commute south every morning to work. In the mid 90’s to early 2000’s technology continued to be drawn towards Silicon Valley, talent flocking towards the area as the valley dominated the tech industry. Companies such as PayPal, Facebook, LinkedIn, and eBay started up at this time.

The Great Recession

Hitting the stock market hard and causing the banks to collapse, 2008 hit America with the Great Recession. Companies struggled to stay open, often having to downsize employees, close locations, and significantly shrink their efforts in order to stay afloat. This recession played a significant part in the shift of roles between tech hub Silicon Valley and urban city San Francisco.


Before the recession, San Fran was a sizable financial hub in its downtown district. Many of the companies that closed were related to the financial industry, causing an increase in industrial power and open office space. This created the perfect opportunity and set of conditions for businesses in San Francisco to form.

Bringing Jobs Back

The Community Benefit Agreement was a tax break incentive passed in San Francisco to motive economic growth. Businesses in the San Francisco area quickly moved in with the combination of the tax break and the open office space. Google, Apple, Facebook, and LinkedIn are some of the few companies which built their own San Francisco offices in order to take advantage of the Community Benefit Agreement terms.

On the Rise

Taking up employees, resources, and even office spaces away from Silicon Valley, San Francisco has become a thriving tech startup hub. Young talent and energy continues to flow into the city, creating new opportunities for entrepreneurial success. The shift to San Francisco can be visibly seen by the reverse in commute, from Silicon Valley to San Fran.


Continuing To Grow
San Francisco is the hottest tech startup hub the United States has ever seen. Companies in technology varying from video games to social media and even video marketing production teams are rapidly growing and thriving within the tech valley environment. Venture capital is rapidly flowing back into the city at an arriving rate as San Francisco continues to develop and grow. The world can only guess what’s next in store for this great city.

What’s next?
Will San Francisco be able to stay on top compared to other cities in the US? Technology businesses in San Francisco are thriving beyond all belief. It will be interesting to see what this city has in store for the future.