On moving to San Francisco, the city of serendipity

My wife and I moved to the Bay Area just about two and half years ago. It seems to often come up in conversation that we're from the Midwest. Even when I reconnect with friends and family, there's a familiar question I get a lot.

"How are you liking it so far?"

Good.

"You think you'll stay for a long time?"

It's quite different from the Midwest, and I want to talk about that for anyone that might wonder why anyone moves here, or why they'd stay. But ahead of that, I want to unpack the major takeaway I have living from my time here:

San Francisco is the city of serendipity. The longer you can afford to stay here and be "in the scene", the more likely you are to meet interesting people, get involved in some project/ startup/ exploration, get advice, get asked for advice, attend events, overhear interesting conversation, find a better role, build momentum.

Don't ignore what I said at the beginning of that takeaway - "the longer you can afford to stay here". This is a very personal limitation.

Finding a Quality of Life Balance

When I was a senior in college, I had been tinkering on some stuff that I'd put somewhere between idea and startup. I had a proof of concept, had good mentors, validated a business case, and done pretty much everything except find and maintain users. I was trying to build something in a really regulated space, and I had somewhat convinced myself that the only way forward was to move to San Francisco, raise money on the concept I had, and use the funds to navigate the regulatory environment, and hire actual developers. I was still pretty new to programming, and without the help of ChatGPT a decade ago, I was moving slower than I would have liked.

I ended up going in consulting, somewhat by luck, but that's a story for another day. I did not make it to San Francisco right out of school.

When you're 22, right out of undergrad, you have a few things going for you:

1. You have no dependents/ obligations. You don't have a family, you don't have a mortgage, you probably don't have a pet dog/ cat. Maybe you've got a significant other, but that person is still a self-sustaining individual, so you can still operate without too many requirements.
2. Your standard of living is likely quite low. You might have finished college in some crappy off-campus apartment. And you probably ate quite poorly, or at least got pretty good at eating cheaply.

You often hear people say watch out for lifestyle creep. Very practical advice, but I think it's quite normal, dare I say healthy, for someone to incrementally improve their quality of living once they graduate - notably if your salary allows it, which assumes you've landed a job.

My original master plan of moving to San Francisco was a calculated risk, where I figured if I could maintain a "poor college student" lifestyle in SF, I had a runway of at least a good portion of year to figure out how I was going to unlock the next step with my fledging business.

Connecting the dots to my earlier point - At 22, my financial standing would have bought me, let's call it a year in "poor college student" conditions.

In my 30's, after spending my time in Kansas City in a rented high rise condo, then a home in the suburbs, with a 2 year old Golden Retriever, we had somewhat higher requirements for living to accommodate our lifestyle. Don't get me wrong, we definitely downgraded our quality of living moving to the Bay Area, but my belief was that we were dramatically increasing the probability of "succeeding" by being here. So the longer we could tolerate living here, the more chances I'd have at "succeeding" in a way that might make it possible to live here indefinitely. And to be blunt, this mostly means financial stability.

The Runway to Succeed

In my eyes, the goal of anyone living in a high cost of living area is to make enough money to minimize the burden and stress that housing and their lifestyle represents, while simultaneously increasing your quality of life from living in a nicer home, in a nicer area, with less commute (maybe none at all). Maybe you can afford an au pair or nanny to make it easier to raise kids, or at a minimum get into an afford day care without it being a burden. Maybe you have a house cleaner, a landscape crew, maybe even a private chef that takes grocery shopping, cooking, and cleaning off your plate for some part of the week.

Money buys time, no way around it.

Money also buys access. This can be really tangible like joining the yacht club, but it's also the groups you're in, and the "happenings" you become privy to. SF is a big collection of loosely formed clubs, organizations, groups, cohorts, etc. Probably true in every city, but it feels much more tactile here. Ironically, having money also makes things cheaper. I don't mean this in the way one might say that it's expensive being poor (which is it to be clear), but more so in the sense that when you're accomplished (reasonably well correlated with financial wellbeing), you aren't paying an entry fee to go to an event. Maybe you're even being asked to speak, maybe you're commanding value for your time while others have to pay for the privilege of being there at all.

My crude analogy to this point is wealth accumulation is sort of like pushing a snowball up a hill. In San Francisco, the hills are steep and long, but if you make it to the top of the hill, your snowball will keep growing, keep compounding as it rolls down. In the Midwest, literally and figuratively, the hills aren't long, nor steep. You can get your snowball rolling more easily, but you don't have the same opportunity to get momentum.

At the crux of this is that the entry point for quality of life is higher in the Bay Area, but you might also argue that the ceiling is equally high. There's year round "jacket weather" (maybe not always good?), you can be within 30 minutes of a beach (although you probably aren't swimming), there's hiking opportunities in most directions, and you can't forget about Napa and Sonoma just 90 min North. Drive a few hours for Lake Tahoe, you can ski at Palisades in the winter. And that's just on the leisure side, the professional gain of being here is implied, right?

Think about this heuristic in a lower cost of living area. You may have few chances to really "make it" (however you want to define this), but you might be very comfortable with everything in your life (housing, career, family/ friends, etc). You may never tip the scale.

The one dimension I think people somewhat underestimate, particularly when you're young, is if you have the right trajectory in your growth to afford a future lifestyle that you cannot yet imagine or predict. At somewhere between 2-3% inflation, prices will double every ~25 years, even less in high inflation periods like we've seen. So in a ~40 year career, the starting expectation you might have had for where you needed to end up needs financially needs to be doubled at a minimum to keep pace. This doesn't even include the lifestyle creep that I hope you'd aspire to between 22 and 62.

In the Bay Area, if you make enough money, if you get a windfall from an exit, a tender offer, some other form of wealth building, then you can buy the $3M home in Pacific Heights or the Peninsula, send your kids to private school, and ignore the fact that it is a grind to even exist here, let alone succeed.

I don't think everyone is as lucky. No one is saving enough money from their job to afford the down payment on that nice home without being crazy levered with laughable debt-to-income ratio.

My second core takeaway is that you need to find the right balance of optimizing for quality of life, while equally enabling your runway to keep getting a chance to sit at the table that is San Francisco.

As you get older, as you accrue obligations in life, to your spouse, your pet, your parents, your relatives, your friends, your career, the debt on your car, your mortgage, etc. So you may not be able to keep living like a 20 year old when you're 30 and beyond. And you don't want to look back and feel like you over-indexed, sacrificing too much of one part of your life for another.

This also works the other way around. I think if I had stayed in the Midwest my whole life, I would have always wondered if I had settled, if I had traded some relative comfortable lifestyle with a lower professional ceiling, or at least a slower trajectory.

The strange analogy that just popped into my head: imagine you were attending a party. As you were about to walk into the door, a guy offers you money to go home and not attend the party. Suddenly you now have to weight the value (however you want to define that) of the party, versus the value (in this case monetary, but also consider other forms of value like time) of the stranger and their offer. The party is a lot more enticing, and you aren't giving up much to be there. As you age, the value proposition changes for a variety of reasons. At what point do you not feel the need to attend the party?

The Scale to Stay

As a tangent, I think everyone tolerates where they live. There is some deeply interwoven mix of practical, emotional, social, and psychological forces that tether you to a place. Some of the most practical forces that come to mind:

• Housing/ Cost of Living
  • Access to stable housing, buy vs rent, quality of housing, risk of displacement, cost of food
• Career/ Work
  • Opportunities, industry concentration, network density, local prestige, commute, earning potential, labor competition
• Relationships/ Social Ties
  • Family, friends, partner, community, neighbors, proximity/ availability of care takers, stage-of-life alignment, ease of meeting new people
• Community/ Belonging
  • Sense of identity, cultural/ lifestyle alignment, language, demographics, "safety net", shared values/ worldview, volunteering, religion
• Emotional / Psychological Forces
  • Fear of change, comfort with routine, attachment to personal history, city-based identity, nostalgia, perception of "special"
• Politics/ Governance
  • Local government, social services, safety/ crime, trust, education system, civic engagement, representation, tax system, infrastructure, land zoning
• Physical Environment
  • Proximity to nature, walkability/ transit, climate, density, natural disaster exposure, parks/ public spaces, water/ mountains, greenery
• Inertia/ Friction/ Flywheel Effects
  • Logistics of moving, career setup, kids in school, career licensing, immigration status, social capital accumulation

Some factors are positive, some are negative. Wealth impacts a lot of these. At some point, the scale might lean so far that it doesn't feel like tolerating anymore. You might not even be wealthy, but you might have a flywheel from family, friends, your career, etc. that makes it hard to even consider leaving where you're at.

So when you do eventually move, the scale resets. It's not quite equal, as you move elsewhere, you start to optimize for other things, you make tradeoffs, sacrifices, you reassess the weight of each element.

The Juxtaposition of Entrepreneurship in SF

Living in such an expensive area means that it's very difficult to quit a salaried job to go full time on something unless someone/ something has already backed you, or you're willing to materially cut/ reduce your living expenses. The latter can be particularly difficult if you've built up any level of obligations in life, or lack a runway (e.g. most people don't quit their job on conviction when living paycheck to paycheck). The largest accelerators somewhat cater to this idea of judging your commitment based on the conviction to do something increasingly illogical, or give up a cushy lifestyle and the credential of working at Big Tech.

So the ultimate irony is that you're asking potential entrepreneurs to take a massive leap of faith to even be there. Or perhaps the Bay Area has conditioned young people to keep their burn rate as low as possible, such that there is little difference when they do quit a salaried position. It's hard to adopt that culture if you didn't start on it, at least be privy to it growing up. As someone who grew up in the Midwest, the "culture" of Silicon Valley was almost fictional.

In the HBO series, "Silicon Valley", although the show is largely satire, you'll notice that in the first few episodes, Richard and his friends from the "hacker house" they share all work at Hooli, which functionally could be any big tech. Presumably getting paid a salary from Hooli, with a reduced rent for the obligations of their "hacker house", Richard functionally had an unlimited financial runway. Quitting Hooli to work full time on Pied Piper didn't produce any notable change in Richard's living conditions, community, relationships, etc. I can't judge how realistic this is since it doesn't describe me.

But I digress.

Looking Ahead

Living in San Francisco is both a privilege and a strain. A pleasure and burden. Higher highs and lower lows. I'm glad we're here, but I'm not sure it's the endgame for us, although we only have to make that decision a year a time, in sync with our rental agreement.

I've somewhat accepted that the “Midwest version of home” probably doesn't exist here, at least not in the same form. The longer I'm here, the more I re-baseline against the norms of the Bay Area. The weather, the ocean, the opportunity. Things I'll miss when we leave. The cost of living, the distance from family... things I won't miss.

I'm pretty confident that when I look back at my life, regardless of how long we stay here, I won't (and don't) regret the decision to move here. Although I wonder how I would have adapted moving here right out of college versus in my late 20s, I'm pretty happy with the balance we've achieved.

So that's a Midwesterners take on San Francisco, the city of serendipity.

The Tactical Things about San Francisco

If you read this wanting even more tactical opinions of what housing, utilities, food, transit, community, leisure, and politics are like here, I'm working on that in parallel and will update here when published.