Daily Archives: April 9, 2022

Someday, a tech giant may hold a major event in person again. But this years Apple Worldwide Developer Conference (WWDC) wont be it.

Now officially on the schedule for June 6-10, the venerable event will stream live for free, as it did in 2020 and 2021. In a small nod to the virtue of in-person gatherings, Apple will invite selected coders and students to its Apple Park HQ on WWDCs first day to watch the keynote and state of the union session. However, even that will be a video watch party, not a return to live onstage presentations.

Apples announcement came soon after Googleand Microsoft said that their own big developer conferences would be virtual (at least for most of us: Certain Googlers and Google partners will be able to attend the I/O conference in person). A new Meta conference, Conversations, will also be online.

If COVID-19 seems to be on the wane as the fall approaches, we might see some tech company opt to hold a flesh-and-blood confab of the sort that were the default until March 2020. But after two years of virtual conferences, it feels entirely possible thatby and largethe industry will decide that it likes holding streaming-first events and has no desire to return to the old way.

This is not a remarkable insight on my part. My colleague Mark Sullivan said something similar way back in June 2020, after Apple held its first virtual WWDC keynote. I wasnt immediately convinced, in part because I have a conflict of interest: As a member of the press, I have attended hundredsthousands?of live tech events in person. There was a time when such events often werent livestreamed at all, giving us journalists in the room the happy opportunity to relay the news in real time to folks who desperately wanted to get it as quickly as possible. (Apple appeared to have mixed feelings about that arrangement: In the early years of live-blogging, it didnt provide Wi-Fi and was not thrilled with reporters snapping photographs from their seats.)

By prerecording everything, its possible to polish it up in a way that isnt possible with a conventional stage performance.

Developer conferences are different.The fact that in-person WWDC used to sell out in minutes might have been tangible proof of the Apple ecosystems vibrant good health, but it was also a problem for the company. The whole point of educating developers is to encourage the building of as many great apps as possible, thereby strengthening a platform; by limiting attendance to the capacity of the San Jose Convention Center, Apple was cutting off the vast majority of its developer base.

And since developer conferences skew heavily toward matters of software rather than hardware, remote attendance is less of an issue. When Apple unveils a new iPhone or Mac, its still nice to see it in person if you have the chancebut upgrades to iOS and MacOS can be demonstrated adequately via a video stream.

Apple in particular has been reveling in another benefit of virtual presentations: By prerecording everything, its possible to polish it up in a way that isnt possible with a conventional stage performance. Like all of the companys pandemic-era events, last years WWDC keynote had a Hollywood-like sheen, with fancy camera shots, background music, digital transitions, and other touches that made it feel more like a high-end infomercial than a press conference. And if any of the presenters flubbed their lines, retakes eliminated the evidence.

Again, my interests here are not the same as those of Apple, Google, or Microsoft. Ive witnessed some memorably odd unplanned scenes at tech events, from Steve Jobs pleading with bloggers to turn off their Wi-Fi hot spots to director Michael Bay abandoning a Samsung CES launch in progress. When Google cofounder Larry Page took questions at one I/O, he mused about technologists needing safe spaces where they could test their inventions impact on society without consequence. The single most famous moment in any Bill Gates presentation might have been a scanner crashing Windows 98.

I love this sort of stuffnot because I take pleasure in other peoples pain but because its a reminder that humans are unpredictable and technology is oh-so-very fallible. But if I were one of the folks responsible for planning tech events, Id probably seize on every opportunity to eliminate surprises of any kind. Kudos, then, to Google, who will be broadcasting I/O live from Mountain Views Shoreline Amphitheatre. These days, that counts as working without a net.

If the tech industry never does bring back splashy in-person gatherings in great volume, I wont brood. Instead, Ill remind myself that the vast majority I ever attended werent all that scintillating. (There was only one Steve Jobs, after all.) And even those of us who are used to being one of the privileged few should acknowledge the democratizing effect of making events available to everybody who wants to experience them, in exactly the same form. Ultimately, its a positive development for the technology world.

See youmetaphorically, at leastat WWDC.

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Apple's WWDC will be a free stream. RIP, in-person events? - Fast Company

In an interesting bit of equivalence, UK-based insolvency specialist Real Business Rescue has compared the market value of the world's richest companies to countries' GDPs to show how big these businesses have become compared to the rest of the world.

As the table below shows, Apple -- which became the first trillion dollar company in 2018 -- would rank eighth in the world, just behind France, while Microsoft is ranked ninth and worth more than Italy.

Amazon's market value of $1.71 trillion makes it worth more than Canada, while Alphabet, worth $1.54 trillion, would rank 15th in the world. Indeed the five tech giants Apple, Microsoft, Amazon, Meta and Alphabet have the highest market capitalisation and GDP worth of more than 90 percent of the countries in the world.

Shaun Barton, national online business operations director at Real Business Rescue says:

Over the last few decades, companies that have become household names have seen eye-watering growth on a global scale, to the point where their market capitalization overshadows the GDPs of entire nations. Although market cap and GDP represent different things, the comparison helps to visualize the wealth and power held by these businesses.

Our data shows that if Apple, Microsoft and Amazon were countries, they would rank in the top ten richest nations in the world -- highlighting how as the world becomes increasingly connected, the sky is the limit when it comes to growth for global companies. Not only can businesses end up wealthier than the countries they were founded in, but they can become wealthier than more than 97 percent of countries' GDP -- with more growth predicted in the future.

Other companies at the upper end of the league table include oil giant Saudi Aramco, with a market value higher than the GDP of 97 percent of countries in the world, Samsung Electronics, worth more than 87 percent of worldwide GDPs, Johnson & Johnson, at 86 percent, Walmart (84 percent), LVMH (84 percent) Bank of America (80 percent) and Nestl (80 percent).

You can see more on the Real Business Rescue site and the graphic below shows Apple's worth in comparison to a number of countries.

Image credit: peshkov/depositphotos.com

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If tech giants were countries Apple and Microsoft would be among the top 10 richest - BetaNews

E-commerce giant JD.com's founder Richard Liu is the latest Chinese tech CEO to quit his public leadership role.

These exits come as Beijing is cracking down on the sector, and as a slower economy crimps margins.

China's class of billionaire founder-CEOs are feeling the heat.

China's class of billionaire of founder-CEOs are feeling the pressure of government scrutiny.

Ultra-wealthy Liu Qiangdong, also known as Richard Liu, is stepping back from his role as chief executive of JD.com, China's Amazon-like e-commerce giant.

JD.com said on Thursday that Liu has left his role as CEO, but that he remains chairman of the company's board.

Liu founded JD.com in 1998 four years after Jeff Bezos founded Amazon and has a net worth of $13.3 billion, according to Bloomberg's Billionaires Index.

He joins a growing procession of founder-CEOs quitting public leadership roles amid a sweeping crackdown by China's government on its burgeoning technology sector.

In 2020, Zhang Yiming, founder of TikTok-owner ByteDance, stepped down as CEO and subsequently from his chairman role. In 2021, Su Hua, founder of TikTok's main rival Kuaishou; and Colin Huang, founder of popular e-commerce platform Pinduoduo, all gave up their roles as CEO.

In 2019, Jack Ma stepped down as chairman of JD.com's main rival Alibaba.

All rank among the richest people on the planet, per Bloomberg, but even their wealth has not staved off scrutiny by Beijing. None of the departing founders have publicly cited government pressure as reasons for leaving or changing roles, but their departures all coincide with increasingly aggressive regulation and threats of breakups.

"These founders may say that they're leaving for personal reasons, but it's too much of a coincidence," said Naubahar Sharif, professor at the Hong Kong University of Technology and Science who researches on China's technology policies. "The predominant driver is politics, and now these old guards need to make way for their successors."

Story continues

The central government has taken aim at labor and consumer rights issues, launched antitrust probes against tech companies, and increased oversight on data security.

The uncertainty has dented investor confidence and hurt company earnings. Last month, Alibaba and social-media giant Tencent both reported their slowest revenue growth on record. JD.com also posted its first annual loss in three years.

JD.com and others are also firing thousands of workers.

Liu has generally stayed out of the public eye since he was accused by a student of rape in 2018. US prosecutors dropped charges against him, citing insufficient evidence. The student, Liu Jingyao, subsequently filed a civil claim in the US against Richard Liu in 2019, seeking damages.

Alibaba's Jack Ma has remained quiet since sparring with regulators in late 2020 over a potential public listing of one of Alibaba's subsidiaries.

Pressure from Beijing means the founders may be making the only calculation available to them, said Sharif. "Maybe their time in the sun is over? Maybe they should let someone else take the role that Beijing can work with?" he said.

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A fourth Chinese billionaire founder-CEO has stepped down as Beijing keeps up the pressure on its tech giants - Yahoo! Voices

In the latest spark from its fast evolving tech ecosystem, Spains scale-ups are banding together to lobby lawmakers and press the economic case for their high-tech, high-growth business model more broadly.

The new lobby group, called EsTech (aka Es for Espaa), had its official launch last week when it unveiled nine founding company members spanning a range of industries, including gig platforms, B2B software, energy, entertainment and health tech namely: Cabify, Factorial, Filmin, Glovo, Wallbox, Holaluz, Neuroelectrics, Jobandtalent and Red Points.

The group wants to create the conditions for a new IBEX35 based in tech as EsTechs president told local journalists covering the launch so the idea is for it to grow substantially in size too.

The hope is that many more of Spains 400+ fast growing startups will soon get big and ambitious enough to join the program, according to Carina Szpilka, a general partner at the Madrid-based VC firm, K Fund, and president of the broader Adigital digital business association which is supporting EsTechs launch, alongside another local trade group, Endeavor, and the Spanish VC association, Ascri.

Other fast growing Spanish startups Typeform, Travel Perk, Heura Foods and Wallapop are suggested as likely candidates to be next in line to join the club.

We are convinced that the contribution of these type of companies, especially the scale-ups, is super significant to the prosperity and to the economic growth of the country. Thats why we started to talk to them, we started to approach them and we started to also share the vision that we want for our country for the future and this is how this initiative was born, Szpilka tells TechCrunch.

Adigital expects Spain to have 20 unicorns by the end of the year. And, seeking to underscore the value to the economy of such high growth startups, Szpilka says that even just that handful of billion-dollar+ valuation tech firms would be contributing 1% of the countrys GDP.

The wider ecosystem of circa 450 scale-ups that EsTech intends to represent will have a goal of reaching 40% tech GDP in 2030.

The [goal for EsTech] is to really facilitate the creation and the growth of these type of companies becoming unicorns or not. I dont care about the $1BN valuation; we care about job creation, sales, the social cash flow that these type of companies can contribute, she adds.

Spains high growth startups have been a bit under the radar domestically when it comes to positive perception of their impact, Szpilka suggests. People really didnt realize the impact that these type of companies are having. And which we are convinced is huge. Last year in terms of sales this group of [nine EsTech founding] companies were more than 4 billion in sales and in terms of job creation they employ currently 10,000 people directly here in Spain.

She also cites job creation stats for the broader base of 400 or so scale-ups in the Spanish ecosystem which, in 2020, were responsible for creating 324,000 new jobs. The expectation for 2021 which is not confirmed yet is going to be around 670,000 employments. So we are talking about a huge percentage already of the employed population in Spain.

Its really impressive the impact and we are convinced that by sharing and making the society be aware of the contribution this will create a positive impact, Szpilka adds.

EsTechs three main objectives boil down to advocacy around 1) talent both promoting talent development within Spain and attracting more international talent to the country (which means lobbying on related tax regimes); 2) regulation, seeking to influence domestic initiatives such as Spains new startup law but also at an EU-level where regional digital policy gets set; and 3) raising the profile of scale-ups on the global tech stage and also locally where entrepreneurs dont always get the warmest reception from wider Spanish society.

On the regulation point, Spains first startup law which was adopted in draft and presented to parliament in December has been well received by the local tech community. But there has also been some grumbling that the thresholds for qualifying for the package of tax breaks and other benefits are drawn too narrowly and will exclude all but very early stage startups.

EsTech seems likely to press that line of argument although at the time of writing it was still preparing its policy plan.

We are leveraging on the new startup law and also trying to bring to the floor some of the best practices around Europe some of them have already been presented in the new startup law, others no. So we are going to take this as a base scenario and try to propose different improvements, says Szpilka. Particularly because there are some things around the startup laws that are just for very small startups but here we are talking about scale ups and here we also want to be listened to.

We need to work all around the different stages, she adds pointing to another draft law, called Crea y Crece, which is more focused on SMEs than tech businesses, and saying EsTechs mission is therefore more to make sure and make everybody aware of how important the contribution of the tech world could also be.

Many, many times I am complaining about the innovation capacity of Spain as a whole the contribution to innovation around the percentage of the GDP in Spain is one of the lowest in Europe but at the same time we have this type of super innovate companies and this should also be an example for other companies in Spain of how you can innovate here and we would love others to see this as a mirror of the type of things that can be done here, she adds.

On the third objective raising the profile and perhaps burnishing the image of scale-ups within Spain the always vocal and sometimes violent protests by taxi associations in cities like Madrid and Barcelona, demonstrating against ride-hailing platforms such as EsTech member Cabify, which are seen as encroaching on rights and livelihoods, look instructive vis-a-vis some of the challenges the group may face in trying to push a positive message of disruption.

Sometimes in Spain the entrepreneurs the empresarios how we call them that are business people have a sort of a bad image, says Szpilka. The entrepreneurs are always looked at as super fancy and smart people but at the end of the day we are the same. So its trying to boost and trying to explain the role that entrepreneurs are playing and their capacity to impact, to transform and to change the society in which we are living.

EsTechs lobbying will presumably seek to establish and/or reframe the narrative around high growth platforms to one of opportunity, job and wealth creation.

Reframe because certain types of digital scaling in Spain have been fast-followed by negative stories especially on the gig economy front, where public concern over issues like the rise of precarious jobs has already led to regulatory reforms.

The countrys center-left government agreed a labor reform targeted at delivery platforms last year which requires them to recognize couriers as employees although, months on, many local gig workers still havent been brought in-house by the platforms they deliver for. And when the labor reform came into force, Glovo another of EsTechs founding companies said it would only hire around 1,800 couriers of the ~10,000 active on its platform in its home market. (As of last October, the company hadnt even hired that fractional amount yet.)

In just one example of synergies and aligned interests within EsTechs club of scale-ups, another of the founding companies, the digital temping agency Jobandtalent, has seen its business valuation soar over the past decade hitting $2.35 billion last December when it closed a $500 million Series E exactly on rising demand for what it bills as a workforce-as-a-service platform that essentially offers a fresh legal workaround for high growth platforms like Glovo which want to keep scaling an on-demand delivery business without having to directly employ thousands of couriers as Spains labor reform intends.

The European Union also recently presented a platform worker reform saying at the end of last year that it would establish a framework to tackle bogus self employment. The final shape of that pan-EU regulation is still pending the blocs co-legislative process so the opportunity for lobbying to influence the detail remains live.

In Brussels, other major pieces of digital regulation are being fast slotted into place too, with political agreement on an ex ante reform of the blocs competition regime (aka, the DMA, which will apply only to the very largest tech giants) recently secured via EU trilogues and a broader update of the blocs ecommerce rules (aka, the DSA) now going through this three-way negotiation process.

The final shape of the DSA will certainly impact how Spains scale-ups operate in the future. While the DMA could bolster the chances of European tech giants being able to compete against global (i.e. mostly U.S.) Big Tech giants at the pan-EU level.

Albeit, any one of these Spanish scale-ups could in theory grow big enough to, one day, end up designed a gatekeeper themselves and face being subject to the DMAs fixed regime of operational dos and donts. Which introduces a new type of cap that scale-ups and their investors may need to consider.

At the end, the EU has a lot to say in this economy, agrees Szpilka, adding: Of course we are talking to Spanish regulators and to the administration here in Spain but EU will be a focus for sure as most of the important things that are coming Digital Markets Act and other regulations around Digital Services Act are in Europe.

Sometimes we think that these regulations only affect the big guys in tech but its more frequent than we think that they are also affecting these scale up companies.

As more scale-ups join EsTech the opportunities to align their respective growth-focused agendas to better amplify shared interests to lawmakers will surely grow although its less clear how successful the domestic bid to re-pitch high growth, high tech businesses to a sometimes sceptical Spanish public will be if socioeconomic divides persist.

Its notable that the government chain-linked its announcement of a 10-year entrepreneurial nation strategy to a very public commitment that no part of Spanish society would be left behind in the scramble to digitally transform its economic model. (Or an ironclad principle that we leave no one behind, as prime minister Pedro Sanchez put at his Web Summit announcement in December 2020.)

So it is perhaps not so surprising that a handful of the largest, fastest growing Spanish scale-ups have responded, fairly quickly, to the government coming with a long term, socially inclusive digital strategy by organizing among themselves with the goal of ensuring their own interests dont get put on the backburner.

Ana Meiques, founder of the health tech scale-up Neuroelectrics and president of EsTech, says the group wants to make sure the needs of these new kids on the block businesses are heard by Spains institutions and policymakers, while simultaneously shouting about scale-up successes internationally to raise the countrys profile on the global stage.

Im spending most of my professional life in the US. There is no connection between Es Spain and tech so this is one of the things that we really want to shout about. We want to show to the world that there is high tech and amazing technology companies being born and growing from Spain, she tells TechCrunch. We really believe that the trade associations that exist today in Spain may not represent this new model.

Some societies like my American colleagues are really good on the selling and speaking and marketing side. I think that in Spain we are quite the opposite. Theres a lot of value, there is a lot of interesting things happening and we dont speak enough about it so this is also a recognition from my point of view to those hidden heroes that go under the radar but they are doing extraordinary things.

If you think of an example like Wallbox, they werent even created six years ago they are 1,000 people today and they went into the Nasdaq. First Spanish company to go into the Nasdaq. They have factories in Texas and China and they are revolutionizing these new electric car plugs. This is a super clear example that we should be proud of. Born and created in Spain. So we want our society to understand that these things are happening here and we want to be part of that community and play the Champions League at the world level. We are as good as others so now is the moment to be proud of whats happening already here.

These companies regardless of who is in their cap table or who are their investors or whether they are at the Nasdaq or in the national stock market, they are bringing thousands of jobs into the countries, Meiques continues. So I think thats one of our biggest social and economical impacts. I think we really have the power, these kind of companies, to transform the economy and the people we employ are high level employees, people with engineering degrees, highly technological.

She also points to the EUs commitment, over ten years, to put 10 billion into investing in scale up companies across the bloc as an opportunity for EsTech to lean out towards regional policies as well as inwards to make the case for disruptive business models locally.

In these kind of associations you need to work both at local and global levels, she adds. We need to attract talent which of course will be from Spain but it will be from all over the world because the war of this decade is going to be on talent.

The other thing that we need is investment. Here the legislators and the regulation has a lot to say to make also the process more streamlined for investors to help us scale up companies. All the tax incentives. Its difficult, currently, to invest in Spain compared to other jurisdictions like the U.S.

The startup law recently proposed by the government as part of its Spain entrepreneurial nation strategy contains a package of reform measures aimed at attracting more tech talent, such as through changes to the visa system and tax regime, as well as interventions focused on pulling in more investment.

But EsTech evidently wants to see more and deeper support support that stretches with startups as they scale.

There are interesting initiatives like the newest Next Tech Fund that the government launched [last summer] particularly for deeptech companies in Spain but we need many more of these, says Szpilka, suggesting Spain has major strengths and growth potential in data startups, clean tech and health. Connectivity is another area she highlights for further growth.

What makes us very unique is we have a very diverse culture in Spain and very entrepreneurial, adds Meiques. And that builds a different kind of view into the world weve got this very perseverant, passionate, fighter character So I think, as a culture, we have the ingredients of creativity and perseverance to be fantastic entrepreneurs. And on the science side I also believe there is a lot of strong universities and labs in Spain which are also under the radar.

So theres this combination and I think that maybe what we are lacking is ambition and a belief that we can be a player.

In the short term, the mission for EsTech is to scale itself by growing its membership. The group will need to add many more high growth tech businesses than its initial cohort of nine to turn up the volume on its claim to being the voice of scale-ups in Spain so local founders appetites for agenda-setting ambition (or at least coordination) are set to be tested.

We already know there are at least ten more [fast growing startups] that are pretty similar to the nine founder members so those will be the first ones well be calling up, says Meiques. And then of course we expect as companies grow and scale and comply with the association that they will join us. So as Carina was saying the idea is to grow our contribution to the economic model and the GDP of the country. The more the merrier.

The criteria for scale-ups to qualify to join EsTech includes being at least post-Series B or C in terms of funding stage; with a consolidated annual growth rate of more than 25%-50%; and an international approach so doing business outside as well as inside Spain, per Szpilka, although the main base of the companys operations or founders must be located in the country.

An acquisition of an EsTech scale-up by a foreign giant wouldnt necessarily cancel membership hence Glovo, which was recently acquired by Germany-based rival Delivery Hero, can still claim a place as a founding member as it retains its local HQ and extensive operations in Spain.

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Spanish scale-ups club together to shift the tech policy agenda - TechCrunch

The Spheres are reflected in one of Amazons corporate office towers at the companys headquarters in Seattle. (GeekWire File Photo / Kurt Schlosser)

As it strives to be Earths Best Employer, Amazon will have to settle for top U.S. company, at least according to LinkedIn and its annual list of the 50 places where people most want to work.

Amazon took the top spot for the second year in a row as LinkedIn ranked companies for the sixth time. The lists top five was rounded out by Alphabet, Wells Fargo, JP Morgan Chase and Walmart. Other tech giants on the list include Apple (No. 9) and Meta (No. 12).

LinkedIn compiled the list by analyzing its data across several categories related to career progression: ability to advance; skills growth; company stability; external opportunity; company affinity; gender diversity; and spread of educational backgrounds.

Amazon added more than 200,000 jobs in 2021 and employs 1.1 million people in the U.S. LinkedIn notes that the most common jobs titles are software engineer, fulfillment associate and warehouse associate.

Even as the countrys second-largest private employer, Amazon continues to compete in recruiting and retaining top talent amid a competitive labor market, LinkedIn said.

Amazon CEO Andy Jassy said in a tweet on Wednesday that there is still plenty more to do. And founder Jeff Bezos also tweeted the results, thanking Amazon workers for their hard work and dedication. It is Day 1, Bezos said.

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Amazon is No. 1 on LinkedIns annual ranking of top 50 companies where people want to work in U.S. - GeekWire

Michael Calore: So what is the thing about Middlemarch that makes you urge other people to read it?

Brian Barrett: It's a very long novel, but basically, as I read it, almost every page is something that's really revelatory about humans and how they work and how they think. It goes on some really fun tangents and diversions into scientific philosophy, so there's something for the science people in there. And it's really the kind of thing where you read it and you think, wow, it's impressive that other people kept trying to write novels after this, because this one kind of did it. Kind of did the thing that novels are supposed to do about as well as you're going to do it. I highly recommend it. It's very worth it.

Lauren Goode: When was it written?

Brian Barrett: It was written a long time ago.

Michael Calore: In the 1800s?

Brian Barrett: It was written in the late 1800s and it takes place in the mid 1800s, which is an important distinction.

Lauren Goode: And George Elliot was Maryanne Evans.

Brian Barrett: Correct, she wrote other

Lauren Goode: Also an English major.

Brian Barrett: There you go.

Lauren Goode: I don't know, I'm guessing.

Brian Barrett: And she wrote under a pen name because she was worried she would not be taken as seriously, unless she had a man's name, which is terrible.

Michael Calore: Sign of the times, I guess.

Brian Barrett: Sign of the late 1800s.

Lauren Goode: So you're enjoying it so much that though you are not finished with the book, you're giving it a wholehearted recommendation?

Brian Barrett: True. So I'm a little over halfway through. Unless Sonic the hedgehog shows up or something, unless it goes terribly awry, I think it's going to keep

Lauren Goode: In the book?

Brian Barrett: Yeah. I'm trying to think of a twist-

Lauren Goode: When new Sonic game drops, I'm done.

Brian Barrett: Yeah. Well, that too. No, I'm about halfway through. Even just the first half alone, I would recommend reading that much. And anything else I think would be gravy.

Lauren Goode: Sonic the Hedgehog.

Michael Calore: I've read the book and I can confirm, spoiler alert, Sonic the Hedgehog does not show.

Lauren Goode: Did you guys have an agreement before the show to drop Sonic the Hedgehog in at some point?

Michael Calore: No.

Lauren Goode: Because that was perfect.

Michael Calore: All right. So Middlemarch. You can buy it pretty much anywhere.

Brian Barrett: You don't even have to buy it, probably.

Michael Calore: It's probably available for free through the library or for like a dollar on the Kindle. All right, Lauren, what is your recommendation?

Lauren Goode: Mike.

Brian Barrett: I also recommend Mike. Mike is great.

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How Pelotons Body-Tracking Tech Fits Into Its Future - WIRED

When Jeremy Hanson moved to Dallas about 1,500 miles from the Goldman Sachs brain trust in New York in 2017, he was one of only three engineers for the bank's consumer business working in Texas. Today, there are hundreds, Hanson told Insider.

But it's not just the consumer team that's rapidly growing in the state. Goldman's presence in the Dallas area which mirrors the New York headquarters in department representation numbers just shy of 4,000 employees in total, nearly double the bank's head count from less than a year ago, it said. And of those Dallas employees, nearly one in four works in the tech organization.

"When we chose Dallas, it was really around the opportunity for sourcing talent," Hanson said, citing the abundance of tech graduates in the state.

After all, Texas engineers have been behind every recent product launch within the bank's consumer division, beginning with personal loans in 2016.

In fact, Wall Street at large is placing a stake in Texas as it looks to strengthen its tech workforce, eyeing both the fresh-out-of-college tech talent and the lower costs than those of longtime tech hubs like San Francisco and New York.

JPMorgan, Citi, and the hedge fund Two Sigma have also built financial-tech foundations in Dallas, Irving, and Houston, respectively. Wells Fargo, which wants to bring on 2,000 technologists this year, is also setting its sights on the Dallas area. Meanwhile, the $7.2 trillion asset manager Vanguard is set to open its new Plano office, home to front- and back-office employees supporting its financial advising services, this quarter.

The saying goes that everything's bigger in Texas. And while no state is immune to the red-hot battle for tech hires, the Lone Star State's vast tech talent pool is quickly turning the state into a key battleground in the relentless war for tech talent. Now competition getting even tighter as financial firms increasingly enter the fray, diverting tech workers away from Amazon, Oracle, Dell, and other tech giants.

Dallas is home to a growing cohort of people who fit within "prime working age," Steve Hagerman, the chief technology officer at Wells Fargo, told Insider, referring to those between the ages of 23 and 38, an age bracket that grew roughly 15% from 2014 to 2019, according to 2019 data from the Bureau of Labor Statistics. Dallas is also one of the top up-and-coming markets for tech-degree completion, he said, with a 71% increase over the prior five years, according to the Bureau.

"If I look at the Bay Area or the New York area, there are skill sets that are just more advanced there," Hagerman told Insider. "But when I look at a place like Dallas, I've got 6,672 tech-degree completions a year and then almost 200,000-person-strong tech market."

Plus, it's cheaper from a corporate view. The algorithm Wells Fargo uses to estimate the annual cost of the presence of 500 workers shows Dallas costs $46 million, compared with a $68 million price tag in San Francisco and $59 million in New York City.

Numbers are an important factor for Wells Fargo, which is looking to hire software developers, database and systems-technology engineers, and engineering management. The firm's Addison office is home to 3,000 corporate (nonbranch) workers, with about 1,000 of those in the tech org, Hagerman said. As for how many of the new hires will be in the Dallas area, that office will undergo "unconstrained growth," he added.

Meanwhile, one of the largest investment managers, Vanguard, is about to move into its new office complex about 10 miles north after spending about $7 million on renovations. The Plano campus, which is set to open in the second quarter of this year, will be home to financial advisors and back-office tech roles with an emphasis on UX designers, cloud-native architecture engineers, infrastructure engineers, and security teams, Joel Dickson, its global head of advice methodology and a senior leader in the new office, told Insider.

Vanguard has been on a hiring spree for that office since November, Dickson said, adding that over the next several years, the firm expected it to house hundreds to thousands of employees.

"Talent availability is going to drive growth in that region," Dickson said.

Citi, which has long had financial-tech operations scattered across Texas, houses the bank's largest technology workforce about 20 minutes away in Irving. It's a hub for the bank's mobile and online applications, Shadman Zafar, the global head of technology for Citi's personal-banking and wealth-management business, told Insider.

The Irving campus has more than 10,000 employees, with the tech workforce made up of software developers, data and machine-learning engineers, infrastructure teams, product managers, and two global command centers accounting for the vast majority of workers, Zafar said. And that share is set to grow, with more than half the bank's open head count for Irving in tech, he added.

Two Sigma, the quantitative fund founded by the billionaires John Overdeck and David Siegel, is also growing its Houston footprint, a key location for the New York fund since the office was established in 2005.

Quant funds rely on computer-based and mathematical modeling to make their bets in the market, and Two Sigma is known for pushing the boundaries on computing and data usage, even among its quant peers.

The $58 billion fund has 80 employees in its software-engineering hub, where its technologists are tackling everything from distributed-computing platforms to big data and financial optimization, Jim Ward, a managing director and the general manager of Two Sigma's Houston office, told Insider. Nearly every engineering vertical is represented in Houston, he added.

Two Sigma is set to add more than 200 engineers to the firm this year, and Houston will be a "key area of focus for growth," Ward said.

While financial firms started growing their tech operations in Texas only in recent years, the state was already home to several tech companies. Texas Instruments and Electronic Data Systems, the information-technology company founded by Ross Perot, for example, were both founded in Dallas. The area also has a burgeoning biotechnology and life-sciences industry.

Tech companies including AT&T, Dell, and Oracle also have strong ties to the state, while Big Tech firms like Amazon and Google have steadily grown their operations in the Dallas and Austin areas. And now, the insurgence of financial firms is diverting a trusty pipeline of new grads away from the traditional tech firms, according to university career-development executives.

Linda Parker has helped engineering students at Dallas' Southern Methodist University land jobs at top local firms like AT&T, Deloitte, and Texas Instruments for almost 10 years as the director of career development at the university's Hart Center for Engineering Leadership. In recent years, she's noticed a growing number of students accepting offers with financial firms like JPMorgan and Goldman Sachs as they've expanded their operations in the Dallas area.

"I've seen this trend where you have a lot more financial-service-type companies that are recruiting engineers because they need that mindset, that different approach to problem-solving," Parker said.

The demand for technical talent spans the state, with engineering students from the University of Texas at Austin also taking more jobs in fintech in recent years. Michael Powell, the director of the school's Engineering Career Assistance Center, said that over the past decade, he'd seen students' interests broaden to include business and finance knowledge alongside their technical skills.

As a result, both UT Austin and SMU have revamped their academic offerings, hoping to better prepare students for a job market where technical skills are more desirable than ever. UT Austin's McCombs School of Business is now home to a blockchain initiative to help students research and better understand topics like cryptocurrency and digital payments, for example. Additionally, SMU's revamped curriculum for MBA students, released in 2020, puts an emphasis on data analytics and project-based learning.

The Texas boom, initiating at the ground floor with college graduates, is also drawing in financial executives at the most senior levels.

Goldman's continued investment in the area, which has mostly been concentrated over the past five years, is largely in response to a growing number of clients in the area, as well as a budding tech ecosystem that's producing top-tier talent, according to Ram Narayanan, Goldman's head of Dallas engineering.

Narayanan is just one of several leaders the firm has recently relocated to Dallas from its New York headquarters. Others are Liz Martin, the bank's head of large partnerships and embedded consumer finance, and Stephanie Cohen, a global cohead of Goldman's consumer and wealth-management divisions. Cohen, for her part, has emerged as a prospective successor to CEO David Solomon.

"There's been a concerted push from the very top of the firm to ensure that we make the right investments in our offices in Dallas, and that's been a consistent theme across the years. There's definitely been a lot of excitement about the quality and quantity of talent that we've been able to find," Narayanan said.

Excerpt from:

Banks, Hedge Funds, and Investment Firms Ramp up Tech Hiring in Texas - Business Insider