Even with a large research university and seaside real estate, it's hard for Santa Cruz to compete with Silicon Valley's pull on engineers and entrepreneurs. Every morning, more than 20,000 people leave Santa Cruz county and commute to work in the Valley.
It's a rare morning when Allison Holmlund is home to help her husband get their kids ready for school. Packing a lunch for her son, James Dean, she explains the ins and outs of her commute. "If I leave before six," she says, "I can make it in about an hour. If I leave after six, it's at least an hour and a half."
Holmlund commutes 48 miles to Redwood City to work for a software startup called Host Analytics. "Having those, call it, three hours of my day, back, would be huge," she says. "But I'm not at the point where I would sacrifice a phenomenal opportunity at a hot startup, which is where I'm at today."
By phenomenal opportunity, she means equity — the chance to own a piece of a company that might pay off like Instagram or WhatsApp. She says Santa Cruz's tech industry can't match Silicon Valley's $700 billion industry, its salaries, or its intense workplace culture. Over the years, companies like Netflix and Seagate started in Santa Cruz, then migrated to Silicon Valley.
But the local tech ecosystem is growing.
Close to 100 people showed up to a recent weeknight tech meet-up downtown, sponsored by the Santa Cruz Office of Economic Development. "Five years ago, we really had to beg to get people here," says Doug Erickson, a regular on the Santa Cruz tech scene.
Afterwards, commuters fill out a survey designed to find out what it would take to make them stay in Santa Cruz. "What percentage of your current compensation would a Santa cruz opportunity have to come up with to get you to forgo your commute?" one question asks.
The man behind the survey is venture capitalist Bud Colligan. He's lived in Santa Cruz for 18 years, but he didn't always invest here. In December, Colligan started a group called the Central Coast Angels with 20 Silicon Valley veterans who live in Santa Cruz.
"It's people from Google, Symantec, Apple, Palm," Colligan says. "At our first meeting, we had a discussion, of, well, 'Should we also do angel investments over the hill?' And my response was, 'You know, there's a thousand angels over the hill. That's not somewhere where we're gonna have a dramatic impact.' Here, we could have a dramatic impact."