Billionaires-in-Waiting

15 Oct 2006|Lori Hobson

Where I live, the neighbors just bought a winning tech lottery ticket. YouTube sold itself to Google for $1.65 billion, turning co-founders Chad Hurley and Steve Chen into hundreds-of-millionaires. (YouTube: another valley garage-to-riches story) Apparently, the whole thing started in Hurley’s Menlo Park garage, and – assuming he still lives here – the sale makes him the latest in a legacy of rich residents in our little bedroom community.

It’s not statistically shocking that our hometown would sell that winning ticket. According to a 2004 Forbes study, Menlo Park is the city in the US where a resident has the highest probability of becoming a billionaire. Actually, the Forbes study refers to our town as “Menlo Park/Palo Alto,” presumably because few people outside of the Valley have any idea where Menlo Park actually is. Palo Alto, on the other hand, appears on most maps and has more exits off the 101.

Starting a business in your garage sounds as if it’s a down-and-dirty, roll up your sleeves kind of activity, but if your garage is in Menlo Park, it’s a little hard to make that claim. The fact is that your garage is worth more than the average price of prime office space in Des Moines. According to last week’s real estate stats (something we Menlo Park residents watch as closely as a day trader watches the NASDAQ), the average price per square foot in Menlo Park was about $620, or a bit off for the year. If a garage is maybe 600 square feet, the price opportunity cost of the early YouTube-style office suite is on par with an Iowa building that features a prime location close to downtown, insulation, legal plumbing, better lighting and fewer roof rats.

Google was also founded in a garage in Menlo Park, but I don’t think that garage or Chad Hurley’s are in our little corner of the city. We seem to attract our own kind, with four households of product designers, an architect, musician, and a couple of photographers all in close proximity. We are huddled together, not so much waiting our turn for riches – no one in Menlo Park really does that – but rather wondering where those guys park their cars at night.

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