Fast Five from the Valley: Edition 53
Is Silicon Valley’s ascent over?
The immense success of the tech industry within the San Francisco Bay Area in which Silicon Valley sits in has resulted in the highest cost of living in America where a median-priced home costs $940,000. That’s four-and-a-half times the American average. A family earning less than $120,000 in San Francisco is considered “low income”. Consequently, this region which has long drawn people in is beginning to cast them out, with multiple counties in the area experiencing their largest combined domestic outward migrations in a decade. People shared their concerns such as the high cost of living, bad traffic and a “toxic” money-obsessed culture. Silicon Valley is still a place where new ideas flourish and innovative products that can transform millions of lives are conceptualized and brought to market. But is this golden era slowly diminishing, and if so, will it ever again dominate the tech world the way it has in the last few decades?
Amazon strikes the magical 13 figure valuation
Following Apple, Amazon is the second US company in the world to hit $1T in market value. However, unlike Apple, Amazon reached this figure through diversifying revenue streams and hit its $1T mark 17 years faster than Apple. Whilst Apple dominates the cool tech hardware category with high-value product leadership, Amazon rules e-commerce and data storage, and has made substantial progress in food delivery, entertainment, and healthcare. Now, the e-commerce giant is poised to disrupt the $88b digital advertising industry, rivalling Google and Facebook. This should make for a great battle between titans…
Munich Re acquires IoT middleware startup, relayr, for $300m
Berlin based Internet of Things (IoT) startup, relayr, helps industrial companies unlock data insights from their machinery and production line units by linking connected sensors and edge devices to platform controls. This startup has been acquired by insurance group, Munich Re in a deal which values the company at $300 million. Relayr has raised $66.8m in total since its conception in 2013, including a $30m Series C round by Deutsche Telekom Capital Partners. Insurance giants and telcos have a clear strategic interest in IoT, with the incoming technology potentially driving network usage and utility for telcos, and offering advanced equipment performance monitoring and prediction for the insurance industry.
Atlassian sets sights on a Silicon Valley in the Land Down Under
Australia’s New South Wales (NSW) government has announced that it will work alongside global tech giant Atlassian to establish a new technology hub in Sydney, envisioning it as Australia’s version of Silicon Valley. The hub’s ambition is to create 10,000 new jobs and establish itself as the innovation capital of Australia by helping the next generation of tech startups to grow. Sydney itself has quite a strong concentration of Australia’s “Silicon Valley” theme, with 40% of Australian startups and R&D based in Sydney.
Instagram to create its own standalone shopping app
Facebook-owned Instagram is supposedly creating a standalone shopping app that would allow users to browse goods from oline merchants and purchase them directly in the app. With Facebook’s huge network, this strategy provides a clear pathway to boost e-commerce revenue through Instagram, a platform that tends to be more receptive to younger audiences with visually appealing content. Instagram has over 25 million business accounts, wherein 2 million of those purchase ads, providing a strong base for high e-commerce growth.