Silicon Valley‘s mild climate, educational opportunities and job prospects have attracted workers for more than a century and helped make the region the epicenter of the tech industry. However, its status as the center of the technological universe may be fading. Here’s why.

A technological exodus

An impossible real estate market, high tax rates and strict regulations have made it difficult to live, work and do business in Silicon Valley. Many CEOs choose to leave California in search of lower real estate prices, better tax laws and fewer restrictions.

Where are tech companies going?

Texas is a state that has been gaining ground as a technology hub. Industry leaders such as Advanced Micro Devices and Dell already have a presence in Austin, aka “Silicon Hills.” In 2020 alone, 45 companies announced relocations or opened new facilities in the Austin area, according to data from the Austin Chamber of Commerce.

Austin has many qualities that make it an attractive option. “There are a lot of things about this community: it has a great local flavor, a great music scene, it’s an outdoorsy town,” said Laura Huffman, former president and CEO of the Austin Chamber, as CNN Business reported. “This is where people want to be. I think 2020 has taught us all that we have more choices when it comes to where we live.

Which companies are leaving?

Here’s a look at some of the big tech companies that announced plans in 2020 to leave the Bay Area for Texas.

• Hewlett Packard companies…Houston is HP’s largest employment hub and the company is currently building a new campus there. The company also announced plans earlier this month to move its headquarters from San Jose to Texas.
• Oracle-As Oracle plans to keep some of its operations in California, it has announced plans to move its headquarters from Redwood City, California, to Austin.The company said the move would “position Oracle for growth and provide our staff flexibility in where and how they work.” spokesperson Deborah Hellinger told CNN.
• 8VC—The venture capital firm, led by Palantir co-founder Joe Lonsdale, is moving its headquarters from Silicon Valley to Austin.“It’s really becoming apparent that there are a lot of places to build all over the country, not just in Silicon Valley, because of the cost of living, talent and all sorts of other things, culture and so on”, Lonsdale told the Austin American Statesman in November.
• FileTrail—The company, which makes case management software for law firms, moved from San Jose to Austin earlier this year.
• DZS inc.—The telecommunications equipment company announced plans earlier this year to move its headquarters from Oakland, California, to Plano, Texas.
• QuestionPro—In January 2020, the online survey software company announced its move from the Bay Area to Austin.

Some CEOs are also moving to Texas. as reported by TheInformation.coma website that covers the technology industry.

• Drew Houston…Dropbox CEO Drew Houston has purchased a house in Austin, which will become his permanent residence.
• Douglas Merritt…Splunk CEO Douglass Merritt recently purchased a home in Austin, intending to make it his permanent home.
• Elon Musk—Tesla is building a large factory near Austin. Its CEO, Elon Musk, announced in late 2020 that he had moved from California to Texas to be closer to the facility.

Florida is another option for tech companies and CEOs

Florida, with its sunshine, affordable real estate and low taxes, is also growing as a tech and startup hub. Reddit co-founder Alexis Ohanian moved to Florida from San Francisco several years ago. Additionally, New York-based Goldman Sachs is considering moving some of its operations to Miami, according to the New York Times.

According to TheNextMiami.comthree tech investors have announced their move to Miami. David Blumberg, founder and managing partner of venture capital firm Blumberg Capital; Keith Rabois, general partner at Founders Fund and former executive of Paypal and LinkedIn; and Jon Oringer, a former New York resident who is the founder and executive chairman of Shutterstock. Oringer recently purchased a $42 million home in Miami.

The essentials

Silicon Valley – and its many technology companies – have been attracting talent for decades. Today, however, exorbitant housing costs, high taxes, and strict regulations have made it a difficult place to live, work, and do business.