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Silicon Bayou rising: New Orleans' drive to be the next great tech city

A group of local entrepreneurs wants to make New Orleans the next San Francisco. Can the Big Easy thrive while keeping its character?

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By Jesse Hicks and Andrew Thompson

From a distance it looked like a typical New Orleans street party: a tree-lined, brick walkway just blocks from the Mississippi River, thronged with people enjoying the late-March weather. The air crackled with excitement, a sense of common purpose. Large speakers flanked the walkway, filling the street with sound.

What came out of those speakers was more surprising: talk of venture capital and startups, and of a city renewed. Under a gazebo, men with microphones spoke with the frenetic energy of sports commentators, their amplified conversations washing over the crowd. One of them asked Wendell Pierce, the charismatic New Orleans native and star of HBO’s Treme, what he thought of the scene before him. “I lived in San Francisco for three years,” he said, “And this is the same thing that’s happening in San Francisco.”

Tim Williamson of Idea Village

A new kind of transplant began settling in: young, ambitious, and self-consciously entrepreneurial

"This" was the culminating day of New Orleans Entrepreneur Week — NOEW, pronounced NO-ee — a flurry of speeches, competitions, and networking events among startups, students, and venture capitalists. The organizers claim 3,000 energetic, well-caffeinated attendees, up from 1,000 just two years ago; it’s part conference, part investment negotiation, part Mardi Gras-style festival, the kind of event where advice on exit strategies is delivered and the phrase "entrepreneurial ecosystem" is consistently invoked, repetition turning the words into something like a conjuration.

It’s a local event, showcasing 42 New Orleans-based startups, with a local flavor. It emerged post-Hurricane Katrina, after the storm and the ensuing catastrophic levee collapse flooded 80 percent of the city and displaced more than 400,000 of its inhabitants. Many of them never returned; while storm-scattered public records make it difficult to estimate just how many, according to the 2010 census, the overall population had decreased 29 percent over the previous decade — a loss of 140,000 people. Meanwhile, a new kind of transplant began settling in: young, ambitious, and self-consciously entrepreneurial. Among new New Orleanians a "tech scene" began to grow, leading to events like NOEW.

In a bigger sense, though, "this" fits a national trend of cities looking to yoke their economic futures to the fortunes of the technology industry. After all, long before it became home to the likes of Craigslist, Twitter, and Yelp, San Francisco was a struggling port city undergoing a drastic process of urban renewal, with mayor George Christopher as a left-coast Robert Moses; in a single generation, San Jose went from being an agricultural center to becoming the pulsing heart of Silicon Valley.

Looking to evoke such cultural and economic transformations, pundits and civic boosters have long touted other cities’ tech sectors with cutely allusive monikers, from New York’s "Silicon Alley" to London’s "Silicon Roundabout" to Washington, DC, which received the decidedly less creative label, "Silicon Valley of the East." Austin is "Silicon Hills," while Portland, Oregon, claims "Silicon Forest." Dallas is sometimes known as "Silicon Prairie" — unless you’re talking about Chicago, part of Wyoming, or Omaha-Des Moines-Kansas City.

The brands have become not just descriptive, but prescriptive, evoked with the same hopeful tones as "entrepreneurial ecosystem" among a group of similar thinkers with familiar ideas about economic development. A leading proponent of this view is Richard Florida, whose influential book The Rise of the Creative Class popularized a view of cities as playgrounds for young, educated, and unmarried "creatives" — including techies. Florida recently hosted an event encouraging Miami’s drive to become "Start-up City." Tony Hsieh, CEO of online apparel shop Zappos, has pursued Florida’s vision of a creative-class destination in Las Vegas, where Hsieh’s $350 million Downtown Project is remaking the city center, complete with yoga studios, charter schools, and rentable Tesla Model S sedans. And ziplines.

New Orleans is a city with a complex past — an accumulation of more than 300 years that no mere hurricane could wash away

Jim Coulter, co-founder of TPG Capital

Then there’s "Silicon Bayou," the New Orleans brand of technology boosterism. The Bayou may not yet have a Tony Hsieh, someone with the money and clout to remake an entire neighborhood, but it’s got people like Tim Williamson, president and co-founder of Idea Village, the nonprofit startup incubator-accelerator-advocacy group that organizes NOEW. It’s run out of the IP Building, a former law-firm tower now filling with co-working spaces and startups. And lured by generous tax discounts, GE Capital has moved into the city to develop software and mobile apps, joining established local outfits such as 3D modeler TurboSquid and Kickboard, which builds software for teachers.

Yet New Orleans is a city with a complex past — an accumulation of more than 300 years that no mere hurricane could wash away. It’s a complicated city, like most, but in its own inimitable way. It’s the birthplace of jazz and a "living museum of music." It’s a world of second lines and jazz funerals, Mardi Gras and krewes, crawfish and gumbo. It’s a city of notoriously corrupt politics and bone-wrenching poverty, where a Mother’s Day parade in the 7th Ward drew gunfire that wounded 19 people. It’s a city of all the things an outsider would never know to list, and the things a native would never need to say.

But might an eagerness to transform New Orleans into a Silicon-something, even if it does succeed in turning the city around economically, render it just another blandly efficient tech town and, in the worst case, replace the local culture — with all its wonders and problems — with the tech-obsessed monoculture that so rankles some San Franciscans? Can the Big Easy remake itself as the Silicon Bayou? And if so, how will that change the city?

Williamson is sanguine about the question. He invites the comparison to San Francisco; like New Orleans, it’s a port city rich in history and known for cultural diversity. Yet he doesn’t see his city becoming some cookie-cutter, technophilic metropolis. "I think New Orleans is very unique," he says, "and this entrepreneurial ecosystem will not be like anyone else’s, because not much of what we do is like anyone else. Who else has Mardi Gras?"

The Crescent City’s Idea Village

Like many an influential project, Idea Village began in a bar. Williamson and four friends were having drinks after work at Loa Bar, a business-district hotel lounge, in 2000. All five were locals who’d left for better opportunities in the 1980s. An Uptown native who’d majored in business at Tulane University, Williamson joined New York’s financial industry, even working a stint at Bear Stearns before founding several multimedia companies along the East Coast. Like his friends, he found himself returning to New Orleans, only to wonder why the city was in such dire straits. They saw a 25-year decline that’d left their hometown with a leadership vacuum. What the city needed, they decided, was new leadership. It needed a network of entrepreneurs.

"So for 20 years, New Orleans was trying to hold on. There was just no push in trying to be aggressive and grow."

Elliot Sanchez, CEO and Founder of mSchool

They pooled $10,000 to launch a business-plan competition — Idea Village had been born. Its project of mentorship and advocacy began small: between 2002 and 2005, the group assisted 80 startups. It was by necessity a DIY affair; Williamson says that the city’s established business leaders, including the Chamber of Commerce, didn’t show much interest in promoting entrepreneurship.

Instead, according to Bill Hines, chairman of Idea Village’s board of directors, too much time was spent hoping for a renewal of past glories, and not enough looking to the future. "I call it a maintenance model. It was trying to hold on to our energy industry," he says, which in the 1980s had begun to move to Houston, the nation’s oil capital. Houston offered a better standard of living and better access to potential business partners, luring away companies such as Exxon Mobil. There were also tax incentives, including Texas’ lack of a personal income tax. "It was hold on, hold on," Hines says. "So for 20 years, New Orleans was trying to hold on. There was just no push in trying to be aggressive and grow."

Idea Village enjoyed modest success through 2005. Then came the storm. As the city rebuilt, outsiders began offering to help Williamson. In spring 2007 a Stanford MBA named Daryn Dodson called him — he had a half-dozen MBA students ready to spend their spring break in New Orleans to rebuild the economy. "I said, sure, bring some people, bring some money," Williamson recalls. Dodson arrived not just with eager business students, but with $25,000 from an anonymous donor. Idea Village matched the funds, then paired each entrepreneur with a local business. By the end of the week, Williamson says, they’d seen a remarkable impact, "but what we didn't realize was that this was an experience that changed our lives."

Williamson consistently points to Hurricane Katrina as a life-changing event. And it changed the shape of the city. "Everyone in New Orleans became an entrepreneur the day after Katrina," he says. That belief attracted people who wanted to help: The anonymous donor turned out to be Jim Coulter, co-founder of TPG Capital, a $50 billion buyout firm. "After the Red Cross and the things that had to happen, it was clear that what the community needed was a rebirth of jobs and commerce," Coulter, whose wife, Penny, is from the region, says. "And as I looked around the community, Idea Village had a pretty interesting model beyond a typical accelerator and typical incubator in that it's focused on the ecosystem." He’s been funding and participating ever since.

Five years later, NOEW is 10 times its original size. It has forged partnerships with Google, Chase, J.P. Morgan, and almost 30 other companies and organizations. It attracts speakers from Avram Glazer, the co-chairman of Manchester United, to Aspen Institute CEO Walter Isaacson, to Jeff Pulver, co-founder of Vonage. Last year, participants invested over a million dollars in almost 500 New Orleans entrepreneurs; this year, attendance ran so high the event was hosted at Gallier Hall — the former city hall, a Greek Revival building where New Orleans inaugurates its mayors and buries its most respected dead.

Joe Peters, New Orleans entrepreneur

Gallier Hall is in the Central Business District. Head just three miles northeast and the neighborhood begins to change. Paralleling the bend in the Mississippi, St. Claude Avenue leads into the Bywater. At the intersection with Louisa Street sits St. Claude Used Tires. Out front sits Joe Peter.

He’s an entrepreneur and a small businessman; his business is the tires stacked tall and long, crowding around him. He sits on a chair worn down to the foam, shaded by a large wooden awning. A hand-lettered sign on the building lists his fees: "Patch $20.00" and below that, "Labor $5.00." And nearby: "No cash refunds." A printed sign reads, "Beware of dog" — there’s a pitbull roaming the yard. During the rescue efforts following Hurricane Katrina, searchers left behind X-codes, the now-iconic markings indicating what they’d found inside. In Peters’ neighborhood, some houses bore the spray-painted X-codes for years afterward. Some still wear them today.

But cities do have character, and that character can change

He used to work at the shipyards, but he’s been working at the tire shop off and on since 1975. When the orders came to evacuate, Peters stayed. He survived the storm. The receding waters revealed a ground strewn with nails and other debris; in the days after the deluge, Peters and his crew handled 30 flat tires a day. He charged the media, reasoning that reporters with expense accounts wouldn’t suffer, but allowed police and city workers IOUs, figuring they’d settle up later. He took money for his work, but when he looked around at the damage wrought to his neighborhood, he told The New York Times, he often wonders "where I'm going to spend it at?"

A woman approaches and asks Peters to borrow $10. Her grandkids are sick. She already owes him $60; he takes a ten from his pocket and gives it to her. "You got a little money, people wanna borrow a little money," he says. "Most of ‘em pay back." When another man asks for a loan, Peters refuses — the man has failed to pay back before.

Seeing a reporter taking notes on a cellphone, he says, "I know, all you kids got smartphones." He remembers penmanship. "A lot of things are gonna be lost because we don’t use them. Everyone wanna get bigger and faster. But some things take time. Like a good bottle of wine. Everything takes time." Later he says, "Eventually there won’t be no need for us," in a voice that suggests he’s all at once talking about the tires, the man who changes the tires, and something much bigger than both.

To Tim Williamson, that might sound like the kind of resignation he heard among local business leaders — an acquiescence to whatever might come, even a blithe fatalism about the future. But this too is New Orleans, still sometimes known as "The City That Care Forgot." A complicated city, from the historic mansions of the Garden District, to the carefully wrought, tourist-friendly nostalgia of the Quarter, to the Treme’s Congo Square, where hundreds of slaves once gathered to sing, dance, and make music. Walker Percy, among its most insightful chroniclers, wrote that, "it is as if Marseilles had been plucked up off the Midi, monkeyed with by Robert Moses and Hugh Hefner, and set down off John O'Groats in Scotland." No, that wasn’t quite it, he decided: "Actually the city is a most peculiar concoction of exotic and American ingredients, a gumbo of stray chunks of the South, of Latin and Negro oddments, German and Irish morsels, all swimming in a fairly standard American soup. What is interesting is that none of the ingredients has overpowered the gumbo yet each has flavored the others and been flavored."

Inevitable, that gumbo metaphor, and clear-eyed Percy didn’t overlook Nawlins’ tendency toward self-mythologizing. New Orleans, the city of performers, tended to perform, to strut and swagger, to draw attention to its quaintness and its potential for mischief, its careful embrace of vice. In short, it’s a place easy to romanticize, because the city has long romanticized itself.

But cities do have character. And that character can change, often before we realize how or why. Joshua Long, a professor of environmental studies at Southwestern University, wrote Weird City: Sense of Place and Creative Resistance, detailing how Austin, Texas, became a new tech boomtown, thanks to cooperation among the local Chamber of Commerce, the University of Texas, and companies like Dell. Through the 1990s, Long says, Austin experienced a disorienting degree of growth and change, and went from a mid-size college town to a city with an international reputation.

The character of the area changed; driven mostly by good intentions, the local identity became something else. As New Orleans is doing today, Austin set out to attract the best and brightest: Florida’s creative class, among them the tech workers looking for not just middle-class jobs, but upper middle-class jobs. They’d grow the tax base and, in Florida’s formulation, other businesses would follow them. Unlike some industries — say, natural gas extraction — tech was relatively clean, with little worry of environmental damage. Among cities increasingly in competition with one another, courting technology companies and their employees wasn’t just an option, it was an inevitability. Austin was no different.

New Orleans resident, Karl

"But you can’t really separate the economic and cultural relationship here," says Long; money changes things. An in-demand knowledge worker might move from the Bay Area or San Jose or San Francisco, or even from Washington, DC, or Boston, selling a house for $1.4 million. An equally attractive house in Austin could cost a third of that. "The positives are that suddenly you have an influx of money in your urban economy," Long says. "On the other hand, they start pricing everyone else out. And even though you’ve given them a more livable city, it’s become livable for a select few."

Long sees a similar trajectory in New Orleans. After the storm, investors saw opportunities in the city. Much of the inflowing money has gone to the kind of white collar, knowledge-worker businesses that appealed to Austin. "What happens," Long says, "is you start getting two NOLAs. One is still recovering from Katrina: the working class individuals who provide services to the new creative class." Artists and musicians, beloved in Florida’s theorizing, can't afford to move in. The ripple effect of all that new money reshapes neighborhoods; people are forced to leave certain parts of the cities. "Many of the jobs that are left, if you're not college educated or in that specific group, youʼre the service class, or retail workers," Long says. "You end up polarizing your city." (This might sound familiar to San Franciscans who’ve noticed the private shuttles operated by companies such as Apple, Google, and Facebook, which offer employees air-conditioned commutes while avoiding the city’s less-than-stellar public transportation system.)

"People are attracted to real places, " Long says, "but they almost have to bring with them the things that are necessary to our lifestyle now." For young techies that might mean laptops, and coffee shops in which to use them — a particular kind of coffee shop, even, one aesthetically pleasing and conducive to long work sessions, with free Wi-Fi. Tulane geographer Richard Campanella has documented the new style of eateries arriving in the Bywater, which he finds interchangeable with similar restaurants in Austin, Portland, or Brooklyn, "from the artisanal food on the menus to the statement art on the walls to the progressive worldview of the patrons." Long sees that cultural change as virtually inevitable: "We bring that to a city. Do we do that to a place that displaces the current working culture, which may not rely at all on those things and care at all about those things? How do you keep both?"

Making the future

Chris Boyd is an young app developer who moved to New Orleans in 2012. Ready to leave Houston, he was looking at apartments in Williamsburg and Park Slope in New York City. Instead he found himself selected for NOLAbound, an outreach project run in conjunction with NOEW that brought 25 people to see the city’s economic recovery firsthand. The city’s underdog status appealed to him — "It's a city people want to believe in," he says — but he also saw potential. "When I jumped in," he says, "it was like, this is a moment in this history of New Orleans when everything is ready for this scene to explode."

"I think we can keep our culture because we’ve kept it for so long."

"When I graduated as as senior from LSU," he says, "all you could do was hospitality or tourism. You could work for a hotel or Harrahʼs. Now if you’re a senior grad from LSU or Tulane or New Orleans thereʼs a shit-ton of startups you can work with. And thatʼs a huge difference."

He says this while drinking at Barcadia, a bar stocked with old arcade games, its name and logo stenciled on an exposed brick wall. The local technology news site Silicon Bayou News organizes weekly meetups there. In Philadelphia, a local technology news site organizes occasional meetings at Barcade, a bar stocked with old arcade games, its name and logo stenciled on an exposed brick wall. There’s a Barcade in Brooklyn, too, and Jersey City, New Jersey — it’s a growing company.

Boyd laughs at the impending ubiquity of the bar-arcade concept. As to whether the city’s economic fortunes will change its character, he says, "Of course you don't want your culture to be displaced by tech. But I don't see Las Vegas not being what it is. And I don't see Bourbon Street being displaced by tech." Adriana Lopez, a New Orleans native and reporter for Silicon Bayou News, says, "I think you’re right. I think the more this happens, the more it becomes like any other town. But I think we can keep our culture because we’ve kept it for so long."

Tim Williamson takes up the question at Loa Bar, back where it all began over a decade ago, when he and four friends decided their city needed a change. He talks about the things they wanted to change: the crime rate, the political corruption, the failing schools. "It’s not acceptable to be corrupt. It used to be acceptable to us. It’s not okay to have the worst education system in the country, the worst health care system." He won’t accept those things as given, facts to which one must be resigned. The entrepreneurial movement, he believes, will hold people accountable.

He knows there will be disagreements. He knows people will have differing views about the future of their city — the city in which they all, ultimately, will have to find a place. He’s ready to talk. "Everyone wants progress," he says, "but when we start talking progress, people start talking about the downside of it. The good thing is we’re having this conversation. We weren’t having this conversation 12 years ago."

Cover portrait of Joe Peters, of St. Claude Used Tires
Photography by Brady Fontenot