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03:45 PM
Sara Peters
Sara Peters
Edge Features
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The Next Security Silicon Valley: Coming to a City Near You?

The high cost of doing business in California's San Francisco Bay Area is just one factor driving infosec companies - established and and startups, alike - to pursue their fortunes elsewhere. Here's where many are going.

(Image: archjeff/Adobe Stock)
(Image: archjeff/Adobe Stock)

A rich bounty of technology talent, nearby centers of cutting-edge technical research, perpetually pleasant weather, and plenty of money helped make California's San Francisco Bay Area an IT and cybersecurity mecca. Yet one glance at current real estate prices in Silicon Valley may send one running toward rainy weather and lower rent.

The cost of doing business is just one factor driving cybersecurity companies to pursue their fortunes elsewhere. And as infosec businesses in other places in the world catch fire, setting down stakes in the Bay Area grows not only less appealing, but less necessary.

"There is a general trend of saying 'big cities are too expensive,'" says Hank Thomas, CEO of American cybersecurity venture capital firm Strategic Cyber Ventures (SCV). That's pushing startups and major players alike to set up shop in second-tier cities instead.

Thomas also says he's beginning to see a new entrepreneurial spirit: More infosec professionals are confidently striking out on their own to launch startups, when only four or five years ago that was less common. Individuals with backgrounds in military or government defense, for example, or those with backgrounds in hardware are creating their own security products companies — more so than security services — and establishing headquarters in their own backyards.

"The key ingredients, in my opinion, for success of cybersecurity, which Silicon Valley has, are an abundant supply of venture capital money, entrepreneurs who are risk-takers, and a society which fosters this culture," says Umesh Padval, partner of VC firm Thomvest Ventures. "Silicon Valley is very attractive due to its open culture to attract the best people from around the world, as the area has great universities."

However, international students' enrollment in US universities at both the undergraduate and graduate levels has been decreasing over the past three years, particularly from Saudi Arabia, South Korea, Iran, Mexico, the United Kingdom, and, on the graduate level, India. The changes are attributed to a mix of American universities’ increasing costs, improving programs in home countries, and changing American policies on immigration on international policy, according to the Institute of International Education.

So are there other places that do fit the description that made Silicon Valley appetizing?

Let's take a look at where new cybersecurity startups are spinning up, established firms are laying down new offices, venture capital money is pouring in, universities are generating research and creating security degree programs, and cities are launching initiatives to support the development of the security industry.

(Continued on next page)

Sara Peters is Senior Editor at Dark Reading and formerly the editor-in-chief of Enterprise Efficiency. Prior that she was senior editor for the Computer Security Institute, writing and speaking about virtualization, identity management, cybersecurity law, and a myriad ... View Full Bio
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