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Back to the City

Suburbs may have verdant, picket-fenced lawns, but for companies seeking talent and innovation, the grass is looking greener in the city.

A cartoon city

The year is 1985, and Marty McFly is on his skateboard, zipping through Hill Valley, which features a mall with a sprawling parking lot and not much else. When Marty is transported via DeLorean to Hill Valley circa 1955, he’s greeted with a different picture: a grassy plaza, a malt shop teeming with high schoolers, and people bustling among shops, offices, and houses.

These familiar scenes from the film Back to the Future happen to be a homework assignment for Christopher Leinberger’s graduate students—he’s a professor at George Washington University and author of The Option of Urbanism. The film, he writes, “reflects most of the fundamental changes in how America has been built over the past sixty years.” It chronicles the shift from what Leinberger calls “walkable urbanism” to “drivable suburbanism.”

Many people today are aspiring to live in places more like the Hill Valley of 1955 than 1985—that is, walkable urban centers. And businesses—particularly startups, tech firms, and companies that rely on creative-type workers—are following suit.

Consider suburban Silicon Valley and its urban neighbor San Francisco: For nearly fifty years the home of high tech has been in the valley’s isolated corporate campuses—and earlier in suburban garages. But today San Francisco is outpacing the valley. More than half of the venture capital investment in the combined San Francisco–San Jose metro area went to either center cities or walkable suburbs.

Though the city can be lively and enjoyable, urban living comes with trade-offs, like higher rent for less space. So why are companies so eager to go to town? The answer has a little bit to do with the tastes of America’s millennials and a lot to do with the density, diversity, and resources—a fertile combination for cultivating innovation—found in cities.

The City’s Got Talent

It may seem obvious that startups and tech firms would be attracted to cities. After all, cities have always been founded on commerce, springing up at the intersections of trade and transportation routes.

But over the past half century in the United States, various forces lured people away from the bustling metropolis. Following World War II, government subsidies ushered in the building of highways and cheap, new housing outside of the city, and car ownership became widespread. Alongside bedroom communities arose strip malls, office parks, and ample parking.

Enter the millennial generation. Generally defined as those born between 1981 and 1991, they are a major force in the back-to-the-city movement. They’re looking for areas that offer transit options and a walkable mix of shops, restaurants, and offices. Nearly a third of them currently live in urban areas—a higher rate than any previous generation. In a 2014 Nielsen poll, 40 percent said they would like to live in an urban area in the future.

“This doesn’t mean that millions of people are going to pack up and move their families into cities,” says Alan Ehrenhalt, author of The Great Inversion and the Future of the American City. “But even a modest increase in people living downtown can make a big difference.”

Some signs of that difference: For the first time since the 1920s, growth within US cities is greater than growth outside of them. In recent years, several large firms—Google, Microsoft, Amazon, Pinterest, Motorola, and Procter & Gamble, to name a few—have relocated or opened key satellite offices in urban centers.

“Businesses are concerned, or you might even say obsessed, with how to recruit the talent they need in the coming generation, and that is luring them to cities,” Ehrenhalt says.

Some companies are skipping the suburbs altogether. Salesforce, the cloud computing giant, started in founder Marc Benioff’s apartment in San Francisco’s Telegraph Hill neighborhood. It’s grown to four thousand employees in the Bay Area alone. Earlier this year it signed for 1.4 million square feet of office space, the largest office lease in the city’s history.

Chris Nixon, who earned a MAcc from the Marriott School in 2008, is a finance manager at Salesforce. Although he grew up in the suburbs of Texas, Nixon says he loves living in the City by the Bay, with never-ending possibilities of things to do, great weather, and an easy commute. “Being relatively close to where I work is important to me and always will be,” he says.

The shift toward urban centers isn’t unique to the Bay Area or big-name brands. Just one example: In 2007 Josh Goldblum started Bluecadet, a digital design agency, by working out of collaborative coworking spaces in downtown Philadelphia. To keep up with the agency’s growth, it recently moved its studio to an 8,400-square-foot warehouse in Philly’s Fishtown neighborhood. Goldblum says the city has been a natural fit for the firm’s employees and clients. “We generally find that the people who are really interested in the type of work we do would prefer to live in the city,” he says.

Put the Urban in Suburban

Cartoon neighborhood

If you don’t see a lease on Market Street in your company’s future, you can still take cues from urban life to foster innovation.

Join a coworking space. With a gym-like membership, coworking provides freelancers and entrepreneurs a patch of office space and an opportunity to interact with people doing similar things—or completely different things that just might spark a new idea.

Design for collisions. Innovation requires the sort of serendipitous collisions that Jane Jacobs described happened on her street in Greenwich Village, and rows of cubicles are about as serendipitous as a cul-de-sac. You don’t have to decorate your office with beanbags and exposed brick to get the same benefits as a trendy urban loft. Convert a handful of cubicles into open-plan work areas or create a brainstorming lounge near the staff kitchen or other frequented spot.

Open an urban satellite office. You don’t need to move your entire operation to the nearest metro center. Companies like Yahoo and Coca-Cola still have home bases in the ’burbs but have opened or expanded downtown satellite offices (in San Francisco and Atlanta, respectively) so they can recruit workers unwilling to take on a suburban commute.

Go for urbanized suburbs. Ready to relocate? Look beyond major cities and you’ll find many urbanized suburbs that have adapted to create higher density and a walkable mix of retail, residential, and office spaces, usually in a retrofitted mall or a new town center (think Salt Lake’s Gateway or City Creek).

In the Air

In 1890 economist Alfred Marshall wrote that in the city the ideas of industry are “in the air.” As businesses head downtown in search of hip, young hires, they also find an ideal environment for fostering innovation, with its combination of diversity, density, and resources.

“By its nature, the metropolis provides what otherwise could be given only by traveling; namely, the strange,” wrote Jane Jacobs in her influential 1961 work The Death and Life of Great American Cities.

In the book Jacobs described life on her block in New York City’s Greenwich Village. The street was lined with former tenement housing as well as rows of shops, including a deli, barber, hardware shop, and tavern. Jacobs characterized life in the village as an intricate dance, with a parade of people doing different things for different reasons throughout the day—children walking to school in the morning, workers stopping in for lunch, housewives zigzagging from store to store running errands, bar patrons singing their way home late at night.

One virtue of this diverse bustle is the exchange of knowledge. Passing through a busy city street means interacting (whether you want to or not) with people who are different from you. These encounters facilitate what has come to be known as “knowledge spillovers”: we can learn, consciously or not, from a casual collision. In her later work Jacobs argued that these spillovers between diverse people and industries in proximity to each other lead to innovation and growth.

“Businesses are concerned, or you might even say obsessed, with how to recruit the talent they need in the coming generation, and that is luring them to cities.”

Quantifying the effects of density where people work and live offers an enticing view of urban innovation. One study showed that doubling employment density increases productivity by 6 percent. And when theoretical physicists Geoffrey West and Luis Bettencourt sought to identify the mathematical “laws” of cities, they found that as a city’s population grows, both the productivity of its people and the efficiency of its resources accelerate (even faster than a direct, or linear, relation to its population would predict). That means a person living in a city of 800,000 will, on average, make 15 percent more money and produce 15 percent more patents than the same person living in a city of 400,000.

For Nixon, inspiration comes via daily interactions with people at work, at church, or even on his morning bus commute. “I feel like everyone I meet is doing something interesting; they are smart and ambitious and are exploring different problems and creating solutions,” he says. “It’s inspiring to see the amount of change that’s being driven by people innovating here.”

Downtown’s Downsides

One concern about the urban hype is obvious: Isn’t the rent too darn high?

“There are a lot of great things that come with living in a big city,” says Nixon, who shares an apartment near San Francisco’s Golden Gate Park with his wife and one-year-old. “But there are some things you have to put up with, like higher rent and traffic, and things you have to go without, like more space and a backyard. It’s a scale I’m constantly weighing in my mind—there’s always a trade-off.”

Whether it’s a family or a business, the challenge of affordability requires careful consideration of priorities—which means the big city won’t be the right answer for everyone.

“If you have a knowledge-based workforce where you’re depending on the creative class, moving to the city is a very viable option,” Ehrenhalt says. “Other kinds of businesses don’t need to do that.”

One of the most challenging urban dilemmas, however, is gentrification. When a neighborhood attracts wealthier residents, it often heralds new investments, reduced crime, and increased property values and rents, but poorer residents may be priced out or feel marginalized.

In San Francisco, both derided and celebrated as a hotbed of corporate-fueled gentrification, tensions are palpable. Some residents have staged sit-ins at managers’ homes and protested Google’s private shuttle buses. The residents resent high-paid tech workers for driving up rents and tech companies for negotiating plum tax breaks while the city struggles with budget shortfalls.

Perhaps Google could look to the City of Brotherly Love for ideas. Goldblum says Bluecadet’s hometown pride means finding ways to enhance the city while staying true to its character. For example, he has been involved for several years with Philly’s renowned Mural Arts program. When the director of Mural Arts mentioned she was in talks with artist Shepard Fairey (of Obama “Hope” poster fame) to create a new mural, Goldblum put her in touch with a developer he knew in the neighborhood. This summer the mural was unveiled four blocks from Bluecadet’s studio. Goldblum sees it as a virtuous cycle that helps the agency as well as the community. “Now our neighborhood’s that much cooler,” he says.

If you find yourself in the role of gentrifier, you probably don’t want to be the bad guy—you want to be a good neighbor. There are plenty of ways to do that: Say hi and get to know the people around you. Shop and dine at local establishments when you can. If you have trouble with neighbors, like loud music, always try talking it out before calling the authorities. Consider getting involved with community organizations—just make sure to listen before you jump in with your ideas.

Being a thoughtful neighbor isn’t the cure-all for the negative side of gentrification or for the far broader problem of high-poverty neighborhoods. But just because you can’t solve everything on your own doesn’t mean you shouldn’t reach out to the folks next door.

Present Tense

Let’s get back to Marty McFly: In Back to the Future II, things start to get impressively prescient with the scene set in 2015. “The film nailed the downtown walkable urban redevelopment trends we have witnessed across the country,” Leinberger writes. “Downtown Hill Valley is once again the center of town life, with increased density, vibrant retail, and lots of people on the streets.” One of the details the film gets wrong, he notes, is the use of flying cars.

But who knows? As urban areas draw in more people who exchange knowledge and ideas, perhaps someone will finally manage to perfect flying-car (or time-travel) technology. Perhaps urban-inspired innovation will fulfill Marty’s words: “History is gonna change.”

Enter to Learn, Go Forth to Dallas

Though many students enjoy BYU’s alpine setting, the location can pose a challenge for job placement. While the average top business school is only forty miles from a major employment center, BYU is more than six hundred miles from one.

To address this challenge, in 2013 the Marriott School launched the Geographic Placement Initiative, aimed at increasing job opportunities for students in specific locations around the world.

Michael Roberts, director of the Marriott School’s Business Career Center, says he focuses on building relationships with firms that will recruit students, and on preparing students for interviews and helping them assess the value of different opportunities.

“We want to open up opportunities for students in areas they might not think about,” he says.

The initiative is currently focused on the Dallas–Fort Worth area. Dallas is a great place to start, Roberts says, because it has thousands of corporate headquarters and the Marriott School has a strong network in place. Though it doesn’t fit the urban mold of, say, New York City or San Francisco, the affordable cost of living makes it an appealing option for many graduates.

The Business Career Center has hosted informational sessions and interview training and sent students on trips to Dallas for networking and interviews. The local network, which includes three BYU Management Society chapters and a dozen of the school’s National Advisory Council members, have also helped the initiative along. Last year fifty-three students were placed in Dallas.

“As we learn what is most effective,” Roberts says, “we are working on how to replicate this in other locations.”

_

Article written by Holly Munson
Illustration by Tim Zeltner

About the Author
Holly Munson is a freelance writer and editor. She was raised in the suburbs of California, fell in love with big-city life in Philadelphia, and currently lives in an urbanized suburb of Washington, DC, with her husband and toddler.

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