The Two Faces of San Francisco

A City I Have Known for Years

I was in San Francisco last week for the Draper Annual Meeting.

I met some very impressive founders there. I will probably write about a few of them separately. But before that, I want to write a little about the city itself.

I have been going to San Francisco for many years.

In the mid-2000s, downtown San Francisco had a very different feeling. It was alive. It was energetic. It felt like the future was being written within a few blocks.

You could feel ambition on the streets.

Today, some of those same streets feel very different. In some parts of the city, it almost feels like the city has been emptied out.

A Chronic Wound

Homelessness is no longer a temporary problem. It feels like a chronic wound.

The sense of safety is weaker. Leaving anything inside a car is not just risky; it is something people simply tell you not to do.

Car break-ins may be slightly better than they were two or three years ago, but the general feeling is still far from good.

And this is where San Francisco becomes difficult to understand.

The Contradiction

This is the region that wants to go to Mars.

It is the region redefining artificial intelligence.

It has produced some of the best technology teams, founders, investors, and companies in the world.

But at the same time, it cannot solve problems that look much more basic, much more human, and in theory, much more solvable.

That contradiction is hard to ignore.

Maybe the problem is not only about a lack of technology. Maybe it is also about incentives.

Homelessness has become a large economic system. There are NGOs, programs, funds, budgets, consultants, city departments, and service providers. Around the problem, an entire structure has been created.

This is not a comfortable thought. But it is an important one.

Why San Francisco Still Matters

Still, despite all of this, one thing has not changed.

San Francisco and the Bay Area are still, by far, the most important startup and investment ecosystem in the world.

This is something people outside the region sometimes underestimate.

Network effects are not built overnight. And they do not disappear overnight either.

Talent, capital, knowledge, risk appetite, storytelling, ambition, and second chances still come together here in a way that is very difficult to replicate.

Many cities want to become “the next Silicon Valley.” Some of them are building great ecosystems. Some have stronger infrastructure, better urban life, lower costs, and maybe even better quality of life.

But Silicon Valley is not only a place.

That density is still here.

AI Is Back in the Rooms

AI has also brought a new kind of energy back to San Francisco.

You may not always feel it on the streets, but you definitely feel it in the rooms.

At the Draper event, the founders I met were genuinely impressive.

Every year, I read hundreds of startups, maybe close to a thousand. I speak with many founders. After a while, you develop a sense of the bar.

You know what average looks like.
You know what good looks like.
And sometimes, you can feel when the bar is higher.

The founders at Draper were above that bar.

Questions Without Brakes

One of the best sessions of the event was a conversation between Sal Khan, Stanford President Jonathan Levin, and Tim Draper on the future of education in the age of AI.

Tim Draper’s style is very direct.

He does not soften the question too much. He asks what he wants to ask.

Some of the questions he asked Jonathan Levin were sharp. Not because they were aggressive, but because they forced everyone in the room to think differently.

That is also part of the Bay Area culture.

Questions are allowed to be uncomfortable.
Ideas are allowed to be unfinished.
People are allowed to challenge institutions directly.

This is one of the reasons why the ecosystem still works.

Both Things Are True

San Francisco today is not the romantic technology dream many of us remember from twenty years ago.

On one side, there are empty streets, homelessness, insecurity, and a city that sometimes feels like it is slowly decaying.

On the other side, there are some of the world’s most ambitious founders, the deepest pools of capital, and ideas that continue to push the future forward.

Both are true at the same time.

Maybe that is what an ecosystem really is.

Not a perfect city.
Not perfect people.
Not a clean story.

But a place where imperfect people, inside an imperfect city, still try to build very big things.

From the trip

Still a Starting Point

San Francisco looks like it is falling.