Austin is home to a thriving technology industry that has grown rapidly over the past few decades. This vibrant tech community has attracted businesses and individuals from all over the world, creating a unique ecosystem of innovation and entrepreneurship. But the thriving city we live in today did not happen by accident. Community leaders like George Kozmetsky, Carol Thompson, Pike Powers, Laura Kilcrease, Angelos Angelou, and many others established a foundation in the 1980s and 1990s that set us up for all we enjoy today in the tech community.
The Beginning: IBM and Texas Instruments
The roots of Austin’s tech industry can be traced back to the 1960s, when IBM and Texas Instruments established their presence in the city. These two technology giants were attracted by the University of Texas at Austin, a leading research institution, and the city’s low cost of living. IBM opened its first office in Austin in 1967, and Texas Instruments followed in 1969. The arrival of these companies paved the way for the development of the city’s technology ecosystem.
The Birth of Austin’s Silicon Hills
During the 1970s and 1980s, Austin witnessed a surge in high-tech companies, which earned the city the nickname “Silicon Hills.” This growth was fueled by the establishment of the Microelectronics and Computer Technology Corporation (MCC), a consortium of leading tech companies, in 1983. MCC’s presence in Austin attracted more technology businesses to the city, and many startups began to emerge, focusing on semiconductor manufacturing, software development, and computer systems design.
The Sematech Consortium and the Rise of Semiconductors
In 1988, the Sematech consortium, a collaboration of semiconductor manufacturers, was founded in Austin. This initiative aimed to strengthen the competitiveness of the U.S. semiconductor industry and to accelerate technological advancements in semiconductor manufacturing. Sematech’s establishment in Austin drew significant attention to the city and its thriving tech industry. As a result, major semiconductor companies like Motorola (now NXP Semiconductors), Advanced Micro Devices (AMD), and Samsung invested heavily in the region, opening fabs and research facilities.
The Dell Effect
Perhaps one of the most influential forces behind Austin’s tech boom was the rise of Dell Technologies. Founded in 1984 by Michael Dell, a University of Texas at Austin student, Dell quickly grew into a global powerhouse in the personal computer market. The company created a ripple effect that attracted many other technology companies, vendors, and suppliers to the area. Dell’s success also spawned a culture of entrepreneurship and innovation in Austin, leading to the formation of numerous startups and the growth of venture capital investment.
In addition to Dell, several other companies have contributed to the growth of the entrepreneurial spirit in Austin; IBM, Texas Instruments, Tivoli, Trilogy, and others spawned former employees who went on to found and lead countless other companies in the region.
The 1990s
Throughout the 1990s, the technology industry in Austin continued to grow, with many new startups and established companies setting up shop in the city. The reputation of Austin began to become well known to everyone across the country who worked in technology. Through the efforts of civic leaders, local government, and the Greater Austin Chamber of Commerce, the city became not only a place to start a company, but also a leading place to open satellite offices or move a company’s headquarters. Additionally as the employment opportunities grew, the city quickly attracted young talent to fill these jobs.
The supportive environment for startups and entrepreneurship that emerged in the 1990s has become part of the city’s culture. This has fostered a strong community of angel investors and venture capitalists, who are willing to invest in promising startups. We now boast a thriving ecosystem of all the services needed to run a technology company.
Recent Era
In recent years, Austin has continued to grow as a hub for technology innovation. The city is now home to a wide range of companies, from established tech giants like Apple, Google, and Facebook, to innovative startups and cutting-edge research institutions. This diverse ecosystem of innovation has helped to establish Austin as one of the most dynamic and exciting technology hubs in the world.
One of the key factors driving the growth of the technology industry in Austin is the city’s strong focus on education. Austin is home to several world-class universities, including the University of Texas at Austin, which has a highly regarded computer science program. This focus on education has helped to attract top tech talent to the city, fueling innovation and growth in the industry.
Another factor driving the growth of the technology industry in Austin is the city’s supportive business environment. Austin has a highly entrepreneurial culture, with a strong network of support for startups and small businesses. The city has also offered a range of incentives and tax breaks to businesses in the technology industry, making it an attractive destination for companies looking to establish a presence in the region.
The secret sauce to Austin has been the high quality of life. While the city was more affordable a decade ago, it is still not as expensive as the Valley, New York, Boston, or Los Angeles. The city offers a diverse and vibrant cultural scene, with a thriving music and arts community, as well as a range of outdoor activities and recreational opportunities. This high quality of life has helped to attract top talent, making it an ideal destination for tech workers and entrepreneurs.
Companies like Tesla, SpaceX, Vrbo, Indeed, ZenBusiness, and many others are leading the way in our current economy. With groups like Opportunity Austin, Capital Factory and others making waves to keep Austin moving forward.
The Future
The history of the technology industry in Austin is a story of growth, innovation, and entrepreneurial spirit. From IBM’s early establishment in the city to the thriving tech ecosystem that exists today, Austin has emerged as one of the most dynamic and exciting technology hubs in the world. With its strong focus on education, supportive business environment, and high quality of life, Austin is well positioned to continue driving innovation and growth in the technology industry for years to come.
It is important that we continue to share the stories of our history and make sure that the tech leaders of Austin do not take for granted those who came before us to create the “Austin Tech Miracle”. We now have competition for corporate relocations, as other cities work hard to attract those jobs. Plus, the political environment in Texas, while often pro-business, is not always congruent with those we are trying to attract to our region. We cannot take anything for granted and need to work as a united community to ensure we are establishing a future for Austin that continues to let the tech industry thrive.
The Austin Technology Council
The Austin Technology Council is a 30 year old organization that was founded (originally as the Austin Software Council) to put tech on the map as the future economic driver in the region. By hosting networking and educational events ATC has worked to bring the community together and help create an ecosystem that can support the growth of local companies. As we move ahead, ATC wants to convene grassroots leaders to have meaningful conversations about the next phases of Austin. If we can come together as a community to cultivate the forward looking attitude that our leaders had thirty years ago, we will establish a new foundation for those who will be founding companies three decades into the future.