Magazine

In The Valley, Less Of A Trough


Anyone hoping to take the pulse of Silicon Valley could do worse than drop into Buck's, a diner in the hills of Woodside, Calif. At the height of the tech boom, Buck's was full of venture capitalists and tech geeks, plotting to dominate the universe. For much of the past three years, though, there have been few high-fives or chortles of glee at Buck's. Well, guess what? With the economy strong and the tech recovery starting to gather steam, the movers and shakers are back -- doing business over lobster claw enchilada dinners and pumpkin pancake breakfasts.

Oh sure, this isn't 2000. While job postings are up, few large companies are hiring in a big way. Plenty of offices remain empty. And aside from such high-flyers as Google, Valley companies have yet to revive such perks as free back rubs and laundry service. But Buck's owner, Jamis MacNiven, says customers are scribbling business plans on napkins once again. And he can't help noticing that his parking lot is full of status wheels such as Porsche's (PSEPF) $70,000 Cayenne SUV. "A year ago, people worried about losing their homes," MacNiven says. "Now, there's a buzz that we haven't really seen since 1999."

ON THE PROWL

Moreover, it's breaking out from San Francisco all the way to San Jose. VCs and tech companies are throwing bashes again. Getting a good restaurant table requires a reservation. Hotels are filling up with business travelers. And as Netscape founder Marc Andreessen notes: "The traffic stinks. Things must be getting better."

Startups are the most bullish these days. Jiwire Inc., which lists global Wi-Fi hot spots, easily expects to raise $1 million as VCs go on the prowl again. At Web services' NetSuite Inc., CEO Zach Nelson decided to reward his staff for quadrupling revenues this year, to $20 million. He's spending $50,000 on a Christmas bash at PacBell Park. "This'll be our first big blowout," says Nelson.

On the corporate front, however, caution is still the byword. Yet some signs of life are starting to show. Thanks to monster second-half profits, Intel Corp. (INTC) has revived a program to buy home PCs for half of its employees. That's 40,000 computers. Cisco Systems Inc., another boffo earner (CSCO) of late, is sweetening bonuses for the first time in many quarters. And Advanced Micro Devices Inc. (AMD) is once again giving business trips a green light.

The upshot: While the Valley is by no means the boomtown of yore, it's regaining a little of the old swagger. Shame about the traffic. By Cliff Edwards, with Jim Kerstetter, in San Mateo, Calif.


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