As hundreds of tech companies move to Austin, an unlikely competitor is moving from steel city to technology capital.
Pittsburgh, Pennsylvania is well on its way to growing its tech scene to competitive heights, apparently like Austin did several decades earlier when startups began looking into Dell. And in the age of remote work, Business Insider finds that Pittsburgh has emerged as a surprising technology leader.
Audrey Russo, CEO of the Pittsburgh Technology Council, said Austonia Pittsburgh has the potential to catch up with Austin. “Austin is definitely a few years ahead of us and they have won companies that have gone public,” said Russo.
Before Pittsburgh’s expected sustained growth, the two cities are compared here.
Major turning points for Pittsburgh came with the introduction of Google some 15 years ago; It now employs 760 people and more, adding to its $ 7 billion expansion in 19 states. Similarly, Austin’s first Google office opened in 2007; it now employs over 1,500 people and will occupy the entire new Second Street Tower when completed.
While Google and Uber and the notable big tech companies in Pittsburgh were mentioned, Russo mentioned a few other tech companies, particularly life sciences, biotechnology, robotics, and manufacturing. Roland Peña, Senior Vice President of Global Tech and Innovation at the Austin Chamber of Commerce, pointed out the key players in Austin: Dell, Apple, Tesla.
And Austin isn’t the only one with a booming startup culture. While Austin took 20th place in the Global Startup Ecosystem Report 2021, Pittsburgh was just behind in 23rd place.
“I think we finally have a nice variety of real commercialized products that don’t come from research,” said Russo.
Pittsburgh also had four major IPOs this year, including Duolingo and Aurora. Austin saw success that year with Bumble’s $ 2.15 billion initial public offering – the largest in city history – followed by legal tech company DISCO.
As Pittsburgh seeks to grow its tech scene, Austin serves as an example of how the advent of technology is affecting not only the local economy, but the city’s culture as well.
Young talents are a great attraction for companies that orient themselves at these two similar but very different locations. In Austin’s nearly 1 million people, the median age is 33 years. In Pittsburgh’s 300,000 population, the median age is also 33.
Tech giant Google told a local Pittsburgh newspaper it was moving to the city because Carnegie Melon University sponsored “some of the world’s most brilliant computer and software engineers.” Meanwhile, the University of Texas at Austin has long been an incubator for technical talent; Michael Dell from Dell Technologies is a UT alumnus.
And to keep the youngsters there, both offer similar leisure activities. While Austin has its hiking trails and lakes, Pittsburgh has its own number of parks and rivers. In WalletHub’s active lifestyle ranking, Austin came in 7th and Pittsburgh in 25th.
PNC headquarters in Pittsburgh. (Wikimedia Commons)
When it comes to financial technology, Russo says Pittsburgh has a diverse portfolio that includes a few multinational companies, with PNC Bank being a major player. She said they were at the forefront of trying to solve banking problems.
“But now that everyone’s caught up, what’s the next iteration of financial technology?” Said Russo. This is what the people in Pittsburgh look to with a fintech meetup group and more and more startups.
Austin has deep fintech roots too, and Peña says it’s only getting more popular. “In the short term, I think we have a chance to see more of this,” he said. Instead, Austin is at the forefront of the cryptocurrency boom with groups like the ATX DAO and is a leader in the Texas crypto job market.
Crypto is where Pittsburgh falls short as cloud-based currencies have little pull.
Carnegie Mellon University, which Russo describes as a factor in developing local tech talent. (Carnegie Mellon University / Twitter)
Austin has long been known as a place for tech entrepreneurs on a budget – real estate prices were cheap compared to Silicon Valley. But with the advent of technology, long-term residents are being priced out.
Newcomers to the city are intrigued by Austin’s culture, and for those immigrating from California, it’s a haven where backyard homes are affordable in a busy city. Affordability is paramount in Austin, where the city recorded record average home prices and sales month after month during the pandemic.
Average home price rose 21.1% year over year from $ 441,250 to a whopping $ 536,000, according to the latest report from the Austin Board of Realtors; Housing costs near Tesla’s Gigafactory are up 45% year over year. In addition, Austin is slated to be the most expensive city outside of California for the next year.
Pittsburgh, which has one of the cheapest real estate markets in the northeast, sees the same disruption from becoming a technology city. The average home price in Allegheny County was $ 215,000 in November, up from $ 179,000 in November 2020, according to data from BrokerMetrics.
There’s some excitement among some local guides describing an affordable housing crisis, but Russo believes it is possible to grow at a pace that is comfortable and less like Austin’s rapid growth.
“When I’ve gone to Austin, you can see this transformation that happens every few months,” said Russo. “I’ve talked to friends who are down there and I know there’s a lot of tension: apartment hunting, evictions, Californians making new rules.”
On the other hand, Peña looks positive.
“I look at it from a different angle. I take it with, ‘Hey, we have initiatives that create highly skilled talent so they can improve the quality of their lives,’ ”said Peña. “This is a positive impact because such opportunities are hard to come by without the robust nature of economic activity. We have almost every branch of industry that is trendy right now. “