Is Indianapolis Becoming the Silicon Valley of the Midwest?

Is Indianapolis Becoming the Silicon Valley of the Midwest?

Flipper/Rehabber · Indianapolis, IN · Member since 2015 · 204 posts · 89 votes

Locations of high concentrations of technology workers are, more often than not, found in coastal cities such as Seattle, the San Francisco Bay Area, Boston or New York and New Jersey. However, there are some places, like Indianapolis, where the standard perceptions about high tech companies are starting to become an exception to the rule as to where a high tech company might be located. Companies such as Sales force are creating jobs there, and a few companies are even moving to Indianapolis from more traditional areas like the San Francisco Bay Area. There are other Midwestern cities who are growing the high tech job sector, but their growth rate isn't as high as Indianapolis' rate. Some attribute the growth in Indianapolis to a certain loyalty factor among the workers there. Job-hopping doesn't seem to occur in Midwestern cities the way it does in other areas. And while the growth rate in Indianapolis is strong, it's not so strong as to affect employment rates in the more traditional centers of high tech industry; Silicon Valley doesn't need to worry, yet, about their workers moving en masse to Indianapolis any time soon. What Indianapolis has going for it, however, is the fact that there is a 20-year history of a group of companies located there that has served to boost the area's ability to make gains in the high tech sector. Still, areas like San Francisco enjoy the advantages that come with having a highly concentrated number of companies that are geographically dense. It will take places like Indianapolis some time to catch up in this regard.

Key Takeaways:

  • Indianapolis is a rapidly developing player in the tech industry.
  • Most people don't think of Indianapolis as a tech city...but they are wrong.
  • Several Indiana colleges are supplying the talent needed for the tech industry.

"The Indianapolis region stands out as somewhat of an anomaly: A Brookings Institution analysis published earlier this month suggests newly created tech jobs are becoming increasingly concentrated in coastal centers and a small number of other established hubs."

Read more: http://www.governing.com/topics/mgmt/gov-tech-jobs-indianapolis.html

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Investor · Orange County, CA · Member since 2015 · 2k+ posts · 3k+ votes
9y

Do you have a bunch of artists, hippies, hipsters, and otherwise rough vagabonds in Indy or recently moving in? For some reason they usually come right before the techies, then get PO'ed when the techies price them out. Happened in SF ... happened in Venice Silicon Beach, same with Portland Silicon Forest, same with Austin, etc. Follow the hippies, my friend, especially if they are congregating near a University with a decent computer science department, and get in just before the first successful tech IPO :) 

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  • Specialist · Indianapolis, IN · Member since 2016 · 841 posts · 480 votes
    9y

    @Dustin Ruhl  Thanks - this is great info!

  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    9y

    @Dustin Ruhl  one cannot discount that Palo Alto down through the southern part of Santa Clara county probably has the finest weather year round weather than anywhere in the continental US>

    Along with what attracts  the younger tech workers..  from Silicon valley

    30 minutes to SF world class city.. 1.15 hours to the world famous Napa Sonoma wine country

    1.3 hours to Monterey and big Sur  Santa Crus 45 minutes..  Wilderness 15 minutes away up in the coast range.. 2 to 3 hours to the Sierra Nevada .. 2.5 hours Yosemite.. etc etc.  My point Is with these young techies who have money to enjoy themselves also look at lifestyle past work.. Now if you can afford to buy a home there that's another thing with average home price in Palo alto pretty close to 2 million for a house in Indy that would sell for 150k  LOL.. that's the value prop of Indy

    One reason Portlandia is known as the Silicon forest as well.. lots of out door options close to home and work.

    Don't get me wrong I love what's going on in INdy I have a substantial operation running there and enjoy taking those old great lady houses and modernizing them.

  • Investor · Orange County, CA · Member since 2015 · 2k+ posts · 3k+ votes
    9y

    Do you have a bunch of artists, hippies, hipsters, and otherwise rough vagabonds in Indy or recently moving in? For some reason they usually come right before the techies, then get PO'ed when the techies price them out. Happened in SF ... happened in Venice Silicon Beach, same with Portland Silicon Forest, same with Austin, etc. Follow the hippies, my friend, especially if they are congregating near a University with a decent computer science department, and get in just before the first successful tech IPO :) 

  • Flipper/Rehabber · Indianapolis, IN · Member since 2015 · 204 posts · 89 votes
    9y

    @David Faulkner - Absolutely my friend... Downtown, St. Clair, Fountain Sq and Bates Hendricks are full of the "hipster" community!  The millennial movement is in full effect!

  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    9y

    @Dustin Ruhl  those are my happy hunting grounds and since they don't cash flow much its wide open for guys like me that are not concerned with cash flow just making big gains.

  • Flipper/Rehabber · Indianapolis, IN · Member since 2015 · 204 posts · 89 votes
    9y

    @Jay Hinrichs Exactly right!  I love the area, do quite a few wholesale and FLIPS in the area.  We spend a lot of time downtown and its starting to pay off.

  • Investor · Orange County, CA · Member since 2015 · 2k+ posts · 3k+ votes
    9y
    Originally posted by @Dustin Ruhl:

    @Jay Hinrichs Exactly right!  I love the area, do quite a few wholesale and FLIPS in the area.  We spend a lot of time downtown and its starting to pay off.

    May want to consider holding onto a few as rentals, then ... you will have to bear the brunt of being labelled a speculator by the BP community like Jay and my other left coast brothers have been for years, but I suspect you may be laughing all the way to the bank. Hedge your bets by buying it like a wholesaler, remodel it like a flipper, but then hold it like a landlord. The worst part will be all those damn hippie tenants in the meantime before it turns, LOL.

  • Real Estate Entrepreneur / Investor · Chicago, IL · Member since 2016 · 688 posts · 367 votes
    9y
    Indianapolis is definitely on the uprise. With the addition of low property taxes and much lower taxes in general compared to Illinois/chicago it becomes an investors treasure chest lol. More and more companies will migrate to Indianapolis and the surrounding area. But don't snooze on Milwaukee as well a lot of people in the northern part of chicago is beginning to migrate there as well.
  • Investor · Orange County, CA · Member since 2015 · 2k+ posts · 3k+ votes
    9y

    So my question is if Bay Area is Silicon Valley, Venice is Silicon Beach, Portland is Silicon Forrest ... what would you call Indianapolis? Silicon Ice-cycle?

  • Investor · Berkeley, CA · Member since 2015 · 1k+ posts · 713 votes
    9y
    Originally posted by @Dustin Ruhl:

    Locations of high concentrations of technology workers are, more often than not, found in coastal cities such as Seattle, the San Francisco Bay Area, Boston or New York and New Jersey. However, there are some places, like Indianapolis, where the standard perceptions about high tech companies are starting to become an exception to the rule as to where a high tech company might be located. Companies such as Sales force are creating jobs there, and a few companies are even moving to Indianapolis from more traditional areas like the San Francisco Bay Area. There are other Midwestern cities who are growing the high tech job sector, but their growth rate isn't as high as Indianapolis' rate. Some attribute the growth in Indianapolis to a certain loyalty factor among the workers there. Job-hopping doesn't seem to occur in Midwestern cities the way it does in other areas. And while the growth rate in Indianapolis is strong, it's not so strong as to affect employment rates in the more traditional centers of high tech industry; Silicon Valley doesn't need to worry, yet, about their workers moving en masse to Indianapolis any time soon. What Indianapolis has going for it, however, is the fact that there is a 20-year history of a group of companies located there that has served to boost the area's ability to make gains in the high tech sector. Still, areas like San Francisco enjoy the advantages that come with having a highly concentrated number of companies that are geographically dense. It will take places like Indianapolis some time to catch up in this regard.

    Key Takeaways:

    • Indianapolis is a rapidly developing player in the tech industry.
    • Most people don't think of Indianapolis as a tech city...but they are wrong.
    • Several Indiana colleges are supplying the talent needed for the tech industry.

    "The Indianapolis region stands out as somewhat of an anomaly: A Brookings Institution analysis published earlier this month suggests newly created tech jobs are becoming increasingly concentrated in coastal centers and a small number of other established hubs."

    Read more: http://www.governing.com/topics/mgmt/gov-tech-jobs-indianapolis.html

    Doubtful. Salesforce have offices everywhere.   That doesn't make them tech cities or tech hubs.

    Chicago also has salesforce and google.  I would not call it a tech city and it will not experience the same level of growth of San Jose, Seattle, Portland or Austin.  Check the us census population forecasts and bureau of labor statistics job forecasts.

  • Investor · Berkeley, CA · Member since 2015 · 1k+ posts · 713 votes
    9y
    Originally posted by @Jay Hinrichs:

    @Dustin Ruhl  one cannot discount that Palo Alto down through the southern part of Santa Clara county probably has the finest weather year round weather than anywhere in the continental US>

    Along with what attracts  the younger tech workers..  from Silicon valley

    30 minutes to SF world class city.. 1.15 hours to the world famous Napa Sonoma wine country

    1.3 hours to Monterey and big Sur  Santa Crus 45 minutes..  Wilderness 15 minutes away up in the coast range.. 2 to 3 hours to the Sierra Nevada .. 2.5 hours Yosemite.. etc etc.  My point Is with these young techies who have money to enjoy themselves also look at lifestyle past work.. Now if you can afford to buy a home there that's another thing with average home price in Palo alto pretty close to 2 million for a house in Indy that would sell for 150k  LOL.. that's the value prop of Indy

    One reason Portlandia is known as the Silicon forest as well.. lots of out door options close to home and work.

    Don't get me wrong I love what's going on in INdy I have a substantial operation running there and enjoy taking those old great lady houses and modernizing them.

    Are you developing, flipping or holding?  If the latter two,  you don't need to be concerned with long-term growth potential of the area. Population and job growth here is not nearly as strong as San Jose, Seattle, Portland and the other top 20 fastest growing markets in the U.S.  per the U.S. Census population  and bureau of labor statistics forecasts 

  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    9y

    @Jon Q.  its a far cry from west coast tech hubs.. I have been doing business there since 03.

    nice steady eddie market.. although you have some serious re gentrification going on in some of the inner city neighborhoods.. I target those nation wide.

  • Real Estate Investor · Encinitas, CA · Member since 2016 · 3k+ posts · 3k+ votes
    9y
    Dustin Ruhl It's not a mini-Silicon Valley, it's just not. But then again no other place is. You have sprouts in Los Angeles, Seattle, Boston, Austin, etc. but it's not the same. Salesforce growth in Indianapolis is tied to their acquisition of ExactTarget in 2013. So you lost a corporate HQ of a tech company and replaced it with a division of SFDC. Celebrate Indy for whatever makes it special, not by trying to paint it as a Tier 2 or Tier 3 tech city.
  • Los Angeles, CA · Member since 2015 · 176 posts · 48 votes
    9y
    What areas/zips are most of these jobs located at?
  • Indianapolis, IN · Member since 2013 · 549 posts · 310 votes
    9y

    @Rohan J. most of this is going on square in the middle of downtown. Tech jobs are bringing in a white-collar millennial work force, who have a high demand for downtown living. Therefore, all of the downtown apartments and surrounding downtown neighborhoods are booming, and values are going nuts for a rust belt Midwestern city.

    @Andrew Johnson Not sure that anybody called it a mini Silicon Valley. Post made entitled Indianapolis as the Silicon Valley of Midwest...big difference. Leave Chicago in its own universe, and what other city in the Midwest would you call the "Silicon Valley" out here?  

    I love and respect Indy for what it is, and what it isn't...but also recognize the city is changing in a big way. Eventually others will too.

  • Specialist · Indianapolis, IN · Member since 2016 · 841 posts · 480 votes
    9y

    Indy is a great city.  It has really bounced back!  I manage rehab projects and get to work with a lot of different remote investors & great wholesalers - right now investors are loving Indianapolis.  The downtown area is going through a gentrifiction process.  We are seeing alot of millenials wanting to live close to the downtown area.  

    We have the NBA/WNBA, NFL, professional soccer team, great zoo, great children's museum, Indianapolis Motor Speedwday, NCAA and Big Ten are always hosting a tournament in town, great shopping.  We also have some great restaurants.  Many people don't know, but Indy is a huge test market for many of the better restaurant chains.  Our demographics make it a great test market for many industries.  

    If I can help anyone get connected - please let me know.

  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    9y

    @Ritch Bonisa  its also a logistic center.. IE Fed Ex moved in.. along with mile after mile of wharehouse and logistic's operations.. literally a 3 to 6 hour truck to 2/3 of the population in the US...

    logistics is a little tougher out our way with massive size states and distances between Metro areas.

    you have Seattle and Portlandia 2.3 hour drive but then its 10 hours to SF  SF to LA basin 5 to 7 hours and of course LA to San Diego is only 2.1 hours.

    This location is one reason INdy is a HUB of many sorts.

    however its worth noting you just can't beat that dog gone BAy Area weather..   NO snow.. No ice NO thunderstorms ( rare) NO humidity temps rarely day time even in winter below 50  and on the peninsula rarely over 85..  NOw granted all  this greatness comes at a huge cost to house one self and it does sit smack dab and top of the Loma Preita Earthquake fault which can see 7.0's  ( I lived through the 89 one.  but other than that simply does not get better weather wise and people come from the mid west and they think Oregon is great but then go to Northern CA and they are in Weather heaven.

  • Real Estate Investor · Encinitas, CA · Member since 2016 · 3k+ posts · 3k+ votes
    9y
    Clay Manship Respectfully, I think you made my point for me, trying to paint any city as the "Silicon Valley of the Midwest" doesn't make sense. It doesn't make sense to me to call Los Angeles "Silicon Beach" to me even though it has over 500 start-ups and Snap. If Indy wants to brand themselves as "Silicon Valley of the Midwest", more power to you, but saying trying to use "Salesforce hiring a lot of people" isn't a good reason. Did they hire more people last year than Anthem and Eli Lilly? Genuine question, I don't know the answer!
  • Specialist · Indianapolis, IN · Member since 2016 · 841 posts · 480 votes
    9y

    I hear you @Jay Hinrichs!  Don't forget our tornadoes!  Earthquakes in a city environment - a little scary to us Midwesterners.  Thanks for reminding me of how great location can be!  Never been to Oregon, I hear it's wonderful.  It's on my list!

    In Indy you can also go sledding in the winter and you can water ski in the summer!  

  • Flipper/Rehabber · Crown Point, IN · Member since 2009 · 482 posts · 216 votes
    9y

    I live about 2 hours north of Indy. I'm not here to bash anyone, but I hardly see Indy becoming a "silicon valley" or anything close to it.  I could be full of you know what, but the weather there is cold, they have tornadoes and the closest shoreline is hundreds of miles away! Yes, the cost of living compared to California is....well...there is no comparison. But I just don't see techies moving to the middle of Indiana any time soon. Even though the cost of living is low, the city just doesn't offer much for the younger crowd.  At least up north we have Chicago and Lake Michigan. But yes, we have cold weather and tornadoes here too! I guess time will tell. 

  • Investor · Orange County, CA · Member since 2015 · 2k+ posts · 3k+ votes
    9y
    Originally posted by @Jay Hinrichs:

    @Ritch Bonisa  its also a logistic center.. IE Fed Ex moved in.. along with mile after mile of wharehouse and logistic's operations.. literally a 3 to 6 hour truck to 2/3 of the population in the US...

    logistics is a little tougher out our way with massive size states and distances between Metro areas.

    you have Seattle and Portlandia 2.3 hour drive but then its 10 hours to SF  SF to LA basin 5 to 7 hours and of course LA to San Diego is only 2.1 hours.

    This location is one reason INdy is a HUB of many sorts.

    however its worth noting you just can't beat that dog gone BAy Area weather..   NO snow.. No ice NO thunderstorms ( rare) NO humidity temps rarely day time even in winter below 50  and on the peninsula rarely over 85..  NOw granted all  this greatness comes at a huge cost to house one self and it does sit smack dab and top of the Loma Preita Earthquake fault which can see 7.0's  ( I lived through the 89 one.  but other than that simply does not get better weather wise and people come from the mid west and they think Oregon is great but then go to Northern CA and they are in Weather heaven.

    Then from the Bay Area you head south to SoCal and the weather gets EVEN BETTER ;)

    San Diego has the best weather in the nation for my money (Hawaii may give a run for the money) ... I'm in OC which is close enough for me, LOL

  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    9y

    @David Faulkner perpetual summer is not weather.. bay area has 4 seasons.. so best 4 season weather :).. and Hawaii has Vog  which can be a total bummer.. not to mention 4 to 6 hour plane flight to anywhere you can get seriously rock bound there.

  • Investor · Orange County, CA · Member since 2015 · 2k+ posts · 3k+ votes
    9y
    Originally posted by @Jay Hinrichs:

    @David Faulkner perpetual summer is not weather.. bay area has 4 seasons.. so best 4 season weather :).. and Hawaii has Vog  which can be a total bummer.. not to mention 4 to 6 hour plane flight to anywhere you can get seriously rock bound there.

    Yeah, its a real bummer to have to wear a t-shirt, shorts, and flip flops all year round ... how boring ... you know I was just thinking how bad it was that my winter coat was not getting any use. Call it whatever you like, but I'll take a never ending summer all day, any day, 24/7/365. YMMV :) 

    Getting back to the topic, though, I agree with Jay in that weather really does matter for RE prices and attracting and retaining tech talent who can generally afford to live wherever they like, and I'm sorry, Indy just does not have pleasant weather IMO.

  • Investor · Los Angeles, CA · Member since 2013 · 231 posts · 260 votes
    9y

    Indy is a great city and has a lot going for it.  Nice size city, great for major sporting events, good business environment and so forth.  Not sure it will ever be a major tech center though.  However, tech is growing too big to just be in Silicon Valley so there will be more and more clusters around the U.S.

    Here in Los Angeles, a lot of people hate the Silicon Beach name, because it implies we are trying to replicate Silicon Valley or be another Silicon Valley.  Don't think there will be another Silicon Valley, but there will continue to be tech nodes around the country like LA, Seattle, Austin, Denver, Boston etc...

    I went to college at Purdue, which is the biggest engineering school in the US.  If it was on the West Coast, there would likely be startups all around it.  However, the Midwest is tough for this.  Tech startups tend to be about doing things in new ways, have a global focus and are often started by immigrants, etc..  These are not strengths of this part of the country.

  • Investor · Berkeley, CA · Member since 2015 · 1k+ posts · 713 votes
    9y
    Originally posted by @Jay Hinrichs:

    @Jon Q.  its a far cry from west coast tech hubs.. I have been doing business there since 03.

    nice steady eddie market.. although you have some serious re gentrification going on in some of the inner city neighborhoods.. I target those nation wide.

    Yes, I've heard good things about this market...one of the best cities for families etc.  A contact of mine who works at Eli Lilly Pharmaceuticals is also based at the it headquarters here.  But I just don't see it having the long term potential of Boulder, Austin and other semi tech cities, mostly because of the weather (techies like nice weather + outdoors), population and job growth forecast.

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