Heart of the Silicon Shire

City of Eugene, Oregon

“We still have a vibrant timber industry, but things have changed,” Mr. Ruiz explains. Today, the community is at the heart of a rapidly growing high-tech region dubbed the Silicon Shire. A quiet rival to the Portland area’s Silicon Forest, the Silicon Shire is drawing an increasing number of innovative start-ups and driving a new economy.

“Start-ups, particularly technology start-ups, traditionally have been dominated by Silicon Valley,” says Jim Coonan, Executive Director at Regional Accelerator & Innovation Network (RAIN). “But with the democratization of start-up activity, more and more areas are seen as being attractive for hosting start-up companies.” There are four key aspects that make an area attractive to these start-ups, Mr. Coonan explains – and this region meets every one.

“One of the key ingredients, of course, is having four year universities,” he says. “Places that have developed into entrepreneurial hotspots – places like Boulder and Boston – all have a strong higher education presence, which we have in the South Willamette Valley.” The region has two research universities, the University of Oregon, located in Eugene, and Oregon State University, located in nearby Corvallis. Eugene is also home to Northwest Christian University, Eugene Bible College, and Lane Community College, and one third of the city’s population have completed four or more years of college and at least ten percent of these degrees are in science, technology, engineering, or math. The area has “a really talented workforce,” Mr. Ruiz points out.

“The second aspect is quality of life,” says Mr. Coonan. “Young people are going to places where they want to live and where they want to raise children. And the South Willamette Valley region has got a lot of plusses there as well.” Residents enjoy easy access to both the ocean and mountains, as well as all of the amenities and activities that come with being a college town. “The university [provides] a lot of cultural events and athletic events,” Mr. Ruiz points out. And, as the second largest city in Oregon (population 145,000), Eugene is a regional hub for shopping, healthcare, and entertainment.

Area residents also have access to plenty of local foods and organic farms as well as a burgeoning “fermentation district” of craft breweries. This “is not only a great business, it is also a culture of craft beer, wineries and meads that really helps set that quality of life for us,” Mr. Ruiz explains. Eugene also enjoys a location alongside two rivers, which provide plenty of outdoor recreation opportunities. “Literally ten minutes from my office I have caught a big Steelhead [trout] on the river before coming in for work,” Mr. Ruiz offers as an example. “We have an amazing quality of life in the South Willamette Valley. People like to work here.”

The third aspect that start-ups look for is a low-cost environment, and the Eugene area offers more for less. “In the South Willamette Valley, you can hire a computer science guy for much less money than you can in Silicon Valley, and you can get someone with much more experience,” he points out. The cost of living in Eugene is lower overall, so both the companies and the employees come out ahead financially.

Technological advancements have also made Eugene a more feasible location for tech start-ups. Most notably, the tech sector is no longer tied to certain geographical locations as it once was, Mr. Coonan explains. In the past, “you had to buy a room full of servers,” he recalls. “But now you can host things on the cloud. So now you can physically locate yourself in places outside of major metropolitan areas.”

These four factors – the presence of higher education, a high quality of life, a low cost environment, and technological advancements – have made the South Willamette Valley an ideal spot for tech start-ups. “Oregon used to be considered a fly over state by some people,” Mr. Coonan admits. Now, however, the industry has recognized the state’s unique potential, which has led to the creation of two major tech centers, Silicon Shire and Silicon Forest – both of which are reinventing the Pacific Northwest.

The area is home to much more than just the tech sector, of course, and the region’s start-ups cover a wide variety of industries. Eugene boasts a significant healthcare sector as well as food processing, craft breweries, and small scale agriculture. “We have such a rich valley down in the South Willamette for farming,” Mr. Ruiz explains. “We are developing more and more of a niche in local, organic [foods]. That is important for us.”

Eugene is committed to creating an environment where all types of businesses can thrive. The Regional Accelerator & Innovation Network (RAIN) is one initiative helping the community meet this goal. The unique public / private partnership brings together the University of Oregon, Oregon State University, the regional business community, and the cities of the South Willamette Valley to create a seamless innovation ecosystem that will benefit the entire area. “We are bringing the universities, the government, and the private sector together to abet the entrepreneurial community,” Mr. Coonan explains. “It is a collaboration between parties that haven’t worked together in the past.” The initiative is ground-breaking. “This is the first time that we have tried to directly connect the universities with the economic development plans of the region.”

As a general rule, RAIN helps to build up industries that are already thriving in the region, rather than starting from scratch. “I think sometimes there is mistake made where people say, ‘we want to be in this industry and we are just going to create it from ground zero,’” Mr. Coonan explains. “What we are trying to do is advance industry clusters that are already doing pretty well in the region.” Edusoftware, hardware, and gaming are all key sectors that RAIN is looking to boost.

Eugene is also improving its business climate – and its quality of life – with a major downtown restoration. “That has been a great success story for us,” Mr. Ruiz says of the effort. “Even through the recession there has been more than $200 million dollars of investment in the downtown from both public and private [sources].” The revitalization started about five years ago and focused on a dilapidated JC Penny building and two half-block sized pits that were the remnants of a demolished construction project. “We wanted to focus on filling those two pits with viable businesses and buildings,” Mr. Ruiz recalls. “We spent a lot of effort doing that.”

That effort has paid off remarkably well. “Since then there has been just an amazing amount of activity,” Mr. Ruiz reports. “Between 25 and 30 new businesses have moved in and started up in the past few years.” New businesses include restaurants, pubs, bakeries, coffee shops, tea shops, a movie theatre, retail stores, furniture stores, and a call center. Tech-related businesses have also made a prominent appearance there. “This burgeoning and ongoing tech sector has occupied much of the space that has been recreated in the downtown,” Mr. Ruiz reports. “That has been great for us.”

The reinvented downtown is a boon to residents as well as businesses. “A downtown is really the living room or common space for communities,” Mr. Ruiz points out. “So in some ways, the feel and the vibrancy of a downtown really helps dictate the psyche of the community overall, especially in communities like ours where there is a unique downtown. It really does signal something.”

Perhaps most importantly, Eugene’s downtown restoration signals its increasing prosperity. “I’ve had numbers and numbers of people and businesses look to that as a tremendous success story over the last several years,” Mr. Ruiz explains. The timing is particularly impressive, and it shows that Eugene’s economy knows how to weather a storm. “It [the restoration] happened during the worst recession since the 1930s,” Mr. Ruiz points out.

As tech moves in – and traditional sectors continue to stand strong – business is booming in Eugene. With a shiny new downtown, support from organizations like RAIN, and a bevy of start-ups, the city is headed toward a prosperous future in the heart of the Silicon Shire.

February 25, 2020, 10:34 PM EST