For a generation, America’s digital revolution has been headquartered in Silicon Valley. This is where new industries and new fortunes were seemingly conjured overnight. But now change is in the air and people are wondering whether America’s technology industries are ready to decamp in search of greener pastures—and a more welcoming government. We are thrilled to host two people who have been at the forefront of this shift: Keith Rabois and Mayor Francis Suarez.

Mr. Rabois is a tech investor and general partner at Founders Fund, and a former executive at PayPal, Square, and LinkedIn. He has a track record of being ahead of the curve on emerging trends and has placed his bet on Miami. The city has many assets but perhaps none more important than its mayor, Francis Suarez. Mayor Suarez has been an unapologetic booster for his city, unafraid to take to Twitter to ask dissatisfied Silicon Valley dwellers what it would take to get them and their businesses to relocate to Miami.

But will they? Economics tells us that industry clusters are not random. For years, San Francisco and Silicon Valley have thrived because they offer large knowledge spillovers, a deep talent pool, and many niche businesses that empower the larger ecosystem. Should we expect the next generation of founders to forgo those advantages, or can they be recreated in Miami? What is the role of local government in all of this?

Please join MI director of state and local policy Michael Hendrix on March 12 for a conversation with Keith Rabois and Mayor Francis Suarez on Miami’s future as an innovative city, tech migration, and where we should expect tomorrow’s great businesses to be born.

Event Transcript

Michael Hendrix:

Welcome to the Manhattan Institute's event on The Case for Miami. I'm Michael Hendrix, director of state and local policy here at MI. For what seems like more than a generation, Silicon Valley has seemed to be the headquarters of the tech revolution. New fortunes and new industries just seem to be created overnight there. But recently, something seems to have changed. Many Americans seem to be wondering whether our country's tech leaders, and even themselves, might be in search of greener pastures, sandy beaches, and maybe a friendlier government. To discuss all of that and The Case for Miami, we're thrilled to be joined by two excellent people for that subject, Keith Rabois and Mayor Francis Suarez.

Michael Hendrix:

Now, throughout our discussion, please enter your questions in whatever platform you're watching us and I'll wrap it in.

Michael Hendrix:

First up, I'm proud to introduce Mayor of Miami, Francis Suarez, primed to be elected with 86% support from Miami's residents. Mayor Suarez served as the commissioner for District 4 for eight years. Mayor Suarez has been an unapologetic champion for Miami and booster for the city, unafraid to take to Twitter to ask dissatisfied Silicon Valley dwellers what it would take to get them and their businesses to relocate to Miami, which is why we're also thrilled to be joined by Keith Rabois.

Michael Hendrix:

Mr. Rabois is a tech investor and general partner at Founder's Fund and a former executive at PayPal, Square, and LinkedIn. He has a track record of being ahead of the curve on emerging issues, and that's why he's also placed his bet on Miami.

Michael Hendrix:

Mayor Suarez, I want to start with you. Why Miami? Why are we hearing about people and businesses moving to Miami?

Mayor Francis Suarez:

Well, I think it's a confluence of reasons. Some of them are macro factors that are out of our control and I think there are some factors that are within our control. The macro factors that are outside of our control began with the SALT deduction when high-tax states and cities could not deduct their state and local income taxes from their federal income taxes. The differential in costs of living between a place like Miami and a place like, for example, San Francisco or New York was exacerbated by an additional 10 1/2% to 13%. That was one thing.

Mayor Francis Suarez:

I think the second thing is you saw, for whatever reason, city leaders pushing away innovators from their city. You saw the classic case of a councilwoman in San Francisco that said, "F Elon Musk." You had another case where you had multiple elected officials pushing away Amazon from New York.

Mayor Francis Suarez:

And then I think the third thing is these cities don't seem to take care of the quality of life of their residents. I hear constant complaints about increase in crime, an increase in homelessness in a lot of these major cities. And so we're seeing that these policies that they're enacting are driving innovative people away from their cities. Unfortunately for me as a Cuban American, we saw this sort of happen in Cuba where a charismatic leader came in and said, "Hey, we can solve all of society's problems. All we have to do is just tell the government to take everyone's private property, everyone's businesses, and we'll just make sure that everyone's equal." And the only thing that that system of government has guaranteed for all citizens is equal misery.

Mayor Francis Suarez:

So our formula is simple. We keep taxes low. We don't have a state income or local income tax and we've reduced taxes under my watch, the second lowest rate since the 1960s. While many cities defunded their police, we've actually increased our police funding. We have the most police officers that we've ever had in our history. We reduced crime by 25% last year, and had the lowest homicide rate since 1954 the year before.

Mayor Francis Suarez:

And then we invest in our quality of life. We realize that people like Keith Rabois, they can't live yesterday again. So they're going to increasingly decide to live in cities that have the best quality of life, the best weather, the best cultural offerings, the best sports offerings, the best restaurants, the best entertainment venues. And we're investing in that tremendously.

Mayor Francis Suarez:

And then I would say, at the end, we have an attitude and I have an attitude of how can government facilitate your success? Government should not be an obstructor. Government cannot solve all of society's issues. That is solved through a combination of innovation, frankly, amazing people like Keith who are very generous and are philanthropic, and who continue to build company and build wealth for cities.

Mayor Francis Suarez:

We have to be thankful and I'm personally very grateful for the relationship that I have with Keith and for having Keith as a Miami champion. We wouldn't be where we are right now at this moment without Keith, there is no doubt about it. And it's because of people like him that put their money where their mouth is, who want to do something, who take risks, and who build companies and build wealth for, not just themself, but for many other people. Those are the kind of people that we want in our city and those are the kind of people that we should want in our country.

Michael Hendrix:

Well, that's a great case for Miami. We can just end the program right there. That's amazing. Okay, but seriously though, I also want to ask too, so these are long-running trends. You're talking about some big structural factors too. Is there anything about this moment in particular during the pandemic that you feel has also contributed to people taking a look at Miami?

Mayor Francis Suarez:

There's no doubt about it. I think the fact that we have remote work, the fact that Miami has been relatively open while other cities have been relatively closed, I think that with the "how can I help" tweet and with people like Keith really making a big public bet on Miami has all conspired to make this moment possible. I truly believe that Miami will in the next five to 10 years be the most important city in the globe, not just in the country, but in the world. We're going to be the intellectual capital and monetary capital, and it's going to come from everywhere.

Mayor Francis Suarez:

I mean, it's already coming from Israel, from New York, Silicon Valley. What's great is they all have…

Michael Hendrix:

Well, Keith, I want to turn to you. By the way, we'll also get back to the Mayor's tweet from a couple of months ago. But Keith, you moved to Miami. Why did you move? Was there a moment when you made the decision?

Keith Rabois:

Sometimes there's a moment versus spending six months sort of researching various options to escape California. I think California generally, and certainly the Bay Area specifically, are completely dysfunctional. From a political level, from a societal level, and actually not even understanding the intention of politics.

Keith Rabois:

They sort of inverted the process the government representing people instead of we're supposed to represent the government in politicians. So we were looking around for options that would allow us to be professionally successful, personally happy, and raise kids in an aspirational culture.

Keith Rabois:

In the United States, the answer is very obvious that Miami is by far the best choice. You can debate various places outside the US, but that's a very complex topic and very complicated professionally as well, and personally.

Keith Rabois:

So I think Miami was by far on any metric the best choice. From a taxation, regulation, entrepreneurial culture. From a work ethic, hunger, aspirational, escape, immigrant culture. You've got a cosmopolitan mix of people from Latin America, Europe, New York if you can include that. It's diverse from a societal perspective of retail, art, athletics. The mix was just unprecedented. The cuisine. So it felt like no-brainer choice, actually.

Michael Hendrix:

So just to dig in a little more. Knowing that for you it's such a no-brainer, why this moment? Why now? Some of those factors have existed for quite some time in Miami, but you've made the decision now, and why should other make the decision now?

Keith Rabois:

So I'd separate the two thing. First of all, the dysfunction of California and the Bay Area was just increasing, from homelessness to security, property crime, even violent crime. From the educational system, from the artificial lockdowns and absurd anti-data science Covid policies in the Bay Area and California. That was all a trigger that accelerated the thinking, and the diagnosis that California is going to get worse before it gets better.

Keith Rabois:

Then secondly, Covid lowered the cost of experimentation. So people with a remote first culture, because we had to be remote first, enabled me, enabled my colleagues, aspirational colleagues, to try other parts of the United States at basically no opportunity costs where we didn't have to quit our jobs to consider new options.

Keith Rabois:

As people considered new options, friends, family, colleagues, the feedback was, "Oh my God, why are we suffering through this Bay Area mess? Do we really have to?" We started asking questions. Do we really have to? Well, why? Are the handcuffs more psychological or are they actually pretty real? Is there a network effect that would improve success as an entrepreneur, as a technologist, as a venture capitalist, or are those kind of mental fictions?

Keith Rabois:

And as you double clicked on all these issues, you really came to the conclusion that it was actually sort of the fake news, the proverbial fake news. That the Bay Area had like a monopoly on talent. That it had a monopoly on idea, or that it had a monopoly on a network of talented individuals.

Michael Hendrix:

That is that kind of a wake up moment. I think we're going to get back to that in teasing out some of the factors you mentioned.

Michael Hendrix:

Mr. Mayor, I wanted to get back to you too, to build on that. I feel lived you've lived so much of the past year. You caught Covid early on in the pandemic, and captured the whole experience in daily video updates.

Michael Hendrix:

When people and firms are packing up moving trucks, you tweeted out "How can I help?" It went viral, and now you're very online. You're on the move, as people can see. And also there's the sense that the city is open and booming.

Michael Hendrix:

So that's a lot. What has it been like as Mayor since that December 4th tweet? And do you do your own tweets?

Mayor Francis Suarez:

It's been organized chaos, is what it's been, yes. Actually what's interesting is prior to the December 4th tweet... This is true. Prior to the December 4th tweet, I did not do most of my tweets. I would say I did maybe 10, 15% of my tweets.

Mayor Francis Suarez:

Post December 4th, I would say I do... I mean in December I probably did about 80, 90% of them. I actually tweeted over 800 times, which got 27 million impressions, which is crazy. I mean, it's all organic. There was no paid.

Mayor Francis Suarez:

But I remember a moment, I don't know if Keith remembers this. But I remember a moment, we were in a group chat. I asked Keith, I said, "Is it too much?" I had a sense, as a politician you always have this sense of am I too in peoples' faces? Is it too much? And Keith goes, "Don't stop." That was what he told me, "Don't stop."

Michael Hendrix:

Do you remember, Keith?

Keith Rabois:

And there were doctors and several other very successful technology people on this thread. The uniform feedback from extremely successful founders, CEOs, was, "Actually, keep going," because it's really tapping in, resonating and people really respect the both the effort, and they are looking for future solutions. So we all encouraged him to continue.

Michael Hendrix:

I imagine it's telling that you weren't just tweeting, but you're also on these group chats. That also suggests something. I guess I don't normally encounter mayors on group chats like the one you're describing.

Mayor Francis Suarez:

Yeah, it's interesting how it all sort of came together. It became sort of an informal advisory group for me. There were so many different questions. I'm a neophyte really when it comes to tech even though I feel like I have a PhD now in tech given everything that has happened in the last three months.

Mayor Francis Suarez:

But pre-December 4th, the way I describe it is the 10 years that I was trying to create a technology ecosystem in Miami was akin to nine months inside a womb. The December 4th tweet was like me being born.

Mayor Francis Suarez:

So having advisors like Keith and others that when I wanted to push forward on something, when someone suggested, I had a group of really, really smart people that could tell me. Wait a second, am I missing, should I hit the brakes on this thing?

Mayor Francis Suarez:

That's why this has been successful. People think a lot of this is genius on my part and actually what it is, I've just surrounded myself with geniuses. The geniuses I've surrounded myself with are the ones that are giving me good advice on how not to step on a landmine actually.

Michael Hendrix:

So speaking of advice, how have you been incorporating advice on how you approach the pandemic? It seems sometimes if you're in New York or San Francisco it's not so much a conversation on tech growth and opportunity in Florida that people are talking about. It's Covid in Florida. It's the pandemic. Should you open? Should you not open?

Michael Hendrix:

All these questions. How did you approach tackling this pandemic, safely reopening Miami's economy, and incorporating good, wise counsel as you did that?

Mayor Francis Suarez:

You know, I did it I think in the same way that I approached the pandemic, to this sort of tech renaissance of the city, which is, surround myself with the best people. When you surround yourself with the best people, you get the best advice.

Mayor Francis Suarez:

You have to be humble enough to understand you don't know everything, and humble enough to understand that Keith and others are experts. Just like I dealt with subject matter experts on coronavirus and the economy.

Mayor Francis Suarez:

Also follow your instincts. I mean, listen, Keith is brilliant, but he also has great instincts. So part of it is not just his brilliance, his intellectual brilliance, but part of it is feeling a decision. Do you know what I mean?

Mayor Francis Suarez:

I remember reading a Malcolm Gladwell book called Blink. You know, our mind is processing so many different things that we're much more fine tuned to make decisions than we sometimes give ourselves credit for. But you do need to get input from experts. I did that, and tried to make the best decision possible.

Michael Hendrix:

Keith, I know you're not a public health expert, but certainly you've seen how this whole pandemic has gone down in California versus Florida. Are there other observation you made about how leaders approached it in one place versus the other, and what lessons learned you took away from that?

Keith Rabois:

Well, the contrast is incredibly sharp. I mean, we were out here house shopping in late October and just night and day difference. We'd been locked down in California and weren't allowed to do anything. Nor were schools open, etc. etc.

Keith Rabois:

Then we came here house shopping and the city was vibrant. As far as I could tell, nobody's job had been shut down. There were capacity constraints and the curfew and reasonable measures designed to limit the spread. Most people were eating outdoors, etc.

Keith Rabois:

But it was like night and day psychologically. I mean I think that was the first that I noticed, was people here were happy and smiling instead of depressed. When I'm trying to convince friends and family to move here the first thing I do is just take them off the plane and go out and walk around. You just see people smiling. You can't fake it, a scowl. They forgot what it's like to see people smiling and feeling safe and secure.

Keith Rabois:

The two things they notice right away, are people smile and they see police and the police are friendly and responsive. It's a joy, the presence of the police, versus defund the police. Underinvestment in police where you see homelessness, direct crime, drug abuse right in front of police officers and they won't do anything about it because they've been either counseled, advised, or mismanaged to do that.

Keith Rabois:

Whereas here the police are involved in the community. They're very visible, transparent. So those two things are in incredibly stark contrast to everybody who comes from California, and they say, "I want more of it." Like, "How do I stay here?" How do I stay here, first for a month and extend their stay, and then they wind up buying property.

Keith Rabois:

I have several friends right now, they're actually house shopping. They came here on vacation. Then they extended their stay. Then they extended their stay. And now they have realtors.

Michael Hendrix:

I mean it is amazing how much of a difference it makes when you actually just show up in a place, or I imagine also when a mayor just reaches out and asks the sort of question on Twitter that a VC would ask. How can I help?

Michael Hendrix:

We hear so much about talent regulation. We hear so much about amenities and variety and basic services. It's not like those things don't matter. I mean, you mentioned a lot of those factors. But I also hear you, Keith, and you Mr. Mayor too as well, kind of mentioning shall we say the more invisible. Culture. The kind of spirit. The sense of smiles on people's faces. I'm really struck by how much you mention that, Keith.

Keith Rabois:

Well, you only get to live your life once as far as I know. So you have goals, aspirational goals for yourself. Professionally, for your family, etc. You want to achieve those, and you want to enjoy your experience of living your life.

Keith Rabois:

I think the fiction that you have to divide those two things is really misleading to people, because in fact you can fuse them together and have a successful career. You look at sports. Almost all the winning sports teams in any league in the United States right now, either the number one or the number two team are in Florida. It's not accidental I don't think.

Keith Rabois:

I think the same thing is true in real estate. The same thing is true in financial services, and it's definitely going to be in technology. I think you want to live a holistic life, and you don't want to make these incredible trade-offs.

Keith Rabois:

I also think this is very rooted in centuries of American history, which is we were supposed to vote with our feet. That was the whole goal of having laboratories of democracy and all the stuff that you read about in high school and are taught, but that people sort of forgot were real options.

Keith Rabois:

Europeans have sort of escaped various poor government for decades. Every single successful rock band from the 1960s that emanated out of the UK left because the taxation and regulation policies were just so egregious. They all just located somewhere else on the planet. The Beatles wrote a really good song about the tax man that's worth listening to the lyrics really carefully.

Keith Rabois:

So Americans have sort of forgotten about this option I think, and somewhat ideologically driven people would suppress the option. But Covid highlighted this option is real, and that maybe we should take advantage of it. That's what's basically a lot.

Keith Rabois:

So I think the mayor tapped into a wave. A wave of resentment of politicians abusing their citizens and taking us for granted. A wave of mismanagement. And then a wave of opportunity where people could actually create the life they really want.

Michael Hendrix:

Mayor Suarez, I see you nodding your head.

Mayor Francis Suarez:

Yeah. It's absolutely right. You know, it's funny. Something that Keith said earlier really resonated with me, which is the things that we make complicated are really quite simple. The formula is really simple. It's not complicated.

Mayor Francis Suarez:

I'm traumatized. My family is traumatized from what we experienced in Cuba. So what's happening is we see it happening again. We see government falling into the same trap, and it's a false promise. It's a false promise that if you just grow government we can just take care of more things, right?

Mayor Francis Suarez:

What we see is always it's the inverse. The more you grow government the more incapable it is of taking care of some of the most basic things. Really the more you empower innovation and you empower the private sector, you're going to have, I think, combinations of macro forces that can really help solve some of the biggest issues.

Mayor Francis Suarez:

For example, we have in our city right now 555 homeless persons. 555. I know exactly how many we have. Okay. Five-five-five. That's it. We have 555 in the city of Miami. I'm putting out a plan, hopefully in the next couple of months, to get to what I call functional zero.

Mayor Francis Suarez:

I want to get to zero, right? That's the goal, is to get to functional zero. That's not going to happen with government alone. It's going to happen with a combination of the private sector, the philanthropic sector, experts on homelessness, our government, the police. I mean, it's a collaborative, cooperative effort, right?

Mayor Francis Suarez:

But once you do that, like with any company, any problem that you solve at any company level, the next thing I'm going to try to do is scale it. Right? I'm going to be the President of the US Conference of Mayors. So I'm going to be the president of all the mayors nationally. So what do you think my objective is going to be nationally if come January we're able to get to functional zero? To end urban homelessness in America. Right? That's the goal.

Mayor Francis Suarez:

That's what every big company founder does. When Keith started PayPal, I mean, it started as a company and it's revolutionized the entire payment system in the world, right? I mean it started with an idea and it dominates now the world.

Mayor Francis Suarez:

But, again, you have to let the innovators and the creators do what they do best. Oftentimes, government in an impediment to that. Worse than that, elected officials not only do not appreciate people like Keith and Peter and Elon, and so many others that are in their community, the loose goons of the world. They literally push them away because they have this perverse idea that they are the ones that cause the societal problem. It's totally inverted. It's totally inverse.

Mayor Francis Suarez:

If it wasn't for Keith doing all the things that he does. He's creating jobs on so many different levels. All he's doing is positive things. Let me tell you. When I did the "How can I help you?", part of what prompted me to tweet 800 more times, and three or four hundred times a month after that, and generate 25, 30 million impressions after that, is the positivity.

Mayor Francis Suarez:

What I love about the innovative community, the tech community, is that they're positive. The reason why they're positive is they have to be. You can't get up in the morning trying to create a company and build a product and think of all the ways you're going to fail.

Mayor Francis Suarez:

Yes, failure is a part of life. Yes, you're not going to succeed at everything. Yes, that's all true. But you wake up with an indomitable spirit of can-do and will-do. You solve problems and you look at life from a problems-solutions perspective, which is another thing that very much appeals to me.

Mayor Francis Suarez:

So the fact that there was so much excitement, and then I thought I'd seen excitement in the crypto community, which is why I jumped head in on crypto. So I try to find these trends of excitement and positivity, and I go all in in the context of our brand which is to make Miami the most innovative city on the planet.

Michael Hendrix:

Let's put a pin on the homelessness and housing discussion because that's a good one. We want to come back to that. But on the subject of positivity and influence, Keith, we've got two questions from the audience that I want to lump together because they're good ones.

Michael Hendrix:

One, how many of your friends and colleagues have you convinced to move to Miami? Second is the New York Stock Exchange has made noises about relocating to Miami. Are these idle threats, or do you take it seriously? I think I'll also want to direct this to the major.

Michael Hendrix:

But, Keith, first to you. How many have you convinced? And when you hear companies saying, "We're going to make a move," how do you look at that?

Keith Rabois:

I think it's something like eight or 10 of my closest friends are either here or moving here, then about 100 plus people that would be concentric circles around that. Or building a company from the ground up, so I co-founded Opendoor. It's a successful venture. It's traded publicly now, and reinventing real estate.

Keith Rabois:

We're starting a new company in Miami, where everybody who works in the company is going to be in Miami. So many people are moving here specifically to work in this company. That alone is going to make things easier. We're going to build from the ground up. It's going to take a decade, which is nice because venture capital has about a decade time horizon on every fund.

Keith Rabois:

So I don't expect Miami to outperform Silicon Valley in the next two years. But over the next 10 I think we can do a really good job in building the foundation for the future of America from an innovation perspective. I mean this is a great, stark contrast.

Keith Rabois:

The other, third thing that people notice when they visit from California is lack of homeless people. Living in San Francisco, I actually probably see somewhere between 55 and 500 a day, homeless people. When people come here they notice they don't see very many. In fact, I can count every single homeless person I've seen. I've lived here three months. I actually literally can count. Four.

Michael Hendrix:

That's incredible. Mr. Mayor, are these idle or serious conversations about New York City's financial infrastructure moving to Miami?

Keith Rabois:

Oh, yeah, they're very serious. I would say I actually spoke to the CEO of the parent company of the New York Stock Exchange. The New York Stock Exchange is a little bit more complex. It's not what it used to be. People think of the New York Stock Exchange as a place where people used to trade, a physical place.

Keith Rabois:

The New York Stock Exchange has become essentially a virtual place at this point. So really what it is, is a brand. So it would be kind of weird to change the brand from New York to Miami, so this isn't the conversation that we've had.

Keith Rabois:

But if they put a wealth tax, which is what they're thinking of doing, I think NASDAQ is a very, very big possibility. I think the New York Stock Exchange would have to think about how would it change its brand potentially to move. Maybe it would just be The Stock Exchange from that point forward, and then moving the physical location. I don't think it could be called The Miami Stock Exchange, but anything is possible. It wouldn't surprise me, let's put it that way.

Keith Rabois:

I agree with Keith. It's amazing what we've been able to accomplish in three months. I tell people, "Listen, we live in a 24-hour news cycle where it's hard to keep the attention of the world for one day." We have maintained the attention of the world for three months. Three months, think about that.

Keith Rabois:

In a 24-hour news cycle, we've been on every single television news station, every single major publication. The New York Times, for God's sake, which they don't love to say great things about Miami. Two glowing articles about the City of Miami.

Keith Rabois:

So I think what happened is all these conditions allowed for this migration to happen, but then the last piece was when people got here. This is to Keith's point. When people got here, they realized that it was real, right?

Keith Rabois:

They got here and as close as this is a cool place. Nice place to party. Good place to hang out. They started having the same collisions in coffee shops that they had in Silicon Valley.

Keith Rabois:

I remember when I interviewed Keith for my tech talk he talked about that he had had more meaningful meetings in the short time that he had been here than in four years in Silicon Valley before. So that kind of density, and that kind of opportunity is what's really changing the dynamic, I'm telling you.

Keith Rabois:

Look. There was a couple of counter-narrative articles in the last day. Oh, the New Yorkers are going back. One of the ones cites a guy, this is hilarious. One of the ones cites a guy. The guy texted me saying, "I just put a contract on a $50 house in Coconut Grove." So the guy is definitely happy.

Keith Rabois:

So it's actually kind of funny and it reeks a little bit of desperation that they're inventing stories of people going back when there are literally twice the number of flights from New York to Miami than from Miami to New York. In terms of volume, right, there's twice the number of flights.

Keith Rabois:

So, look, I think this is a generational opportunity. We understand that. We are ready to capitalize on it. I'm going to tweet till my fingers fall off, do you know what I mean, if that's what it takes to make sure that this moment is captured in full not just for my generation, for my son and my daughter, I have a seven-year-old and a three-year old, and for their unborn children.

Keith Rabois:

I don't care what anybody says. There's this debate about technology, Republican, Democrat. It's not a Republican-Democrat issue. It is a fact. Technology dominates our economy. It dominates our life, and it's only going to dominate it more in the future. There is no debate. There is nothing to disagree about. This is not even questionable.

Keith Rabois:

Cities have two choices, and I'm not just talking about cities in America. Cities in the world have two choices. You can grow your tech ecosystem and provide prosperity for your people. Or you can ignore it, or fight it, or pretend that it's going to gentrify, or whatever the negatives are on it, and you're city will literally collapse and die. I mean, it sounds dramatic, but that's really what'll happen.

Michael Hendrix:

And just to tee up one other related question, I also keep hearing about you bringing a sort of tech influence into government. So you just had this eStart initiative that just rolled out. I hear you talking about a virtual city hall. Tell us more about how you're bringing in the actual technology, but also tech mindset into government.

Mayor Francis Suarez:

Yeah. Look, my predecessor was 30 years older than I am. I'm the first generation with a personal computer. The first generation that has cell phones that are more powerful than the spaceships that took astronauts into orbit.

Mayor Francis Suarez:

So for me, again, it's second nature to want to run a 4500 employee billion dollar company with four labor unions in the most efficient technological way forward, understanding that Miami we are a city. We are a service industry. We provide services. We pick up your garbage. We go police your streets. We send out firefighters when you have a house emergency. We want to make building efficient. Do you know what I mean?

Mayor Francis Suarez:

When Keith wants to start a business, we want him to be able to open the business quickly. We want him to be able to build out the building quickly. That's facilitation. That's service. What's great about technology is that it allows for force multipliers, and it allows for efficiency.

Mayor Francis Suarez:

So I have gun fire detection system in my city. I know instantly when any gun shot is fired within a five foot radius with precision. I have cameras that pan to the location automatically, dynamic cameras. I have an artificial intelligence camera system that has facial recognition so we can identify perpetrators. I have, like you said, ePlans, which was when I first got there I created a way for all of our citizens to be able to pull a permit and submit their plans electronically. It didn't happen before.

Mayor Francis Suarez:

Then I created eStart, so that anyone that wants to start a business, and by the way my chief innovation officer hates the name eStart. He thinks it so like 1990. I'm like, "Listen, buddy, once we do eGov then you can rename whatever the hell you want, I don't care." So eStart is being able to start a business from your laptop.

Mayor Francis Suarez:

Then I heard about something that Orlando is doing and it prompted me to do what I call eGov or whatever you want to call it, eCityhall, which is no citizen, in any city really, but certainly in my city, should ever have to walk into a government building. Period. There is no reason, there is no need to walk into a government building.

Mayor Francis Suarez:

You should be able to interact with your government from where you are, Keith. From where you are, and from where I am. Right from the comfort of our own home. And we're going to do that. It's not that hard. In fact, the pandemic has made it easier because I've been working from home anyways. We haven't been working from a central location.

Mayor Francis Suarez:

So it's already happening. But, yes, I'm a big believer that gov tech is a big industry. It's something that as a service provider we should be intelligently spending money on technology that provides better services for our residents.

Michael Hendrix:

We're actually getting a few more questions coming in from the audience. A couple of them are for you, Keith. One is on what's your advice to mid-level engineers or employees who might be worried about missing out on opportunities that they would have in, say, a San Francisco-headquartered company? And then a relation question saying, particularly if they are a minority, if they come from immigrant backgrounds, how can we make sure that they are integrated into the community of Miami as immigrants or minority talent?

Keith Rabois:

Well, on the first question, there's plenty of opportunities here. If you're a talented engineer, I'm happy to hire you right away. Just send me your resume, to foundersfund.com. We'll take care of that. If not, we'll redirect you to plenty of other opportunities here.

Keith Rabois:

But if you're an engineer you have an incredible number of options all across the United States. If you come to Miami, try it for a year, two years, three years, four years. If you love it, stay, build your own company here. That's the aspiration of lots of engineers, to start their own company. And if you don't like it, plenty of people will hire you all across America. So there's like zero risk for an individual.

Keith Rabois:

On the minority side, I mean this is a much more diverse community than anything in the Bay Area. It's like 70% Hispanic, or immigrants from all over the world. I'm Jewish. There's Jewish people everywhere. I actually am still stuck on which synagogue to join because there's one on every block. There's multiple kosher stores. The entire Bay Area has exactly one, maybe two, kosher stores. So you can't even eat kosher in the Bay Area.

Keith Rabois:

The diversity here is like off the charts compared to the Bay Area. That's like the worst excuse ever. The mayor has correctly tweeted there's more Hispanic and Black engineers that are trained in Miami than any city in the United States. So there's a diverse set, a pool of incredibly talented people to hire from as well.

Michael Hendrix:

Mayor Suarez, I don't know if you have any thoughts on that diversity point.

Mayor Francis Suarez:

I would just echo what Keith said. You know what's happening here is Miami is that before this moment we were an intellectual talent exporter. So we created a significant amount of talent, right. People that were born and raised here, that went to high school here, and then they left. Then because the jobs weren't here they couldn't really come back.

Mayor Francis Suarez:

But this is the first time... Let me tell you something that happened, maybe a few times. Let me tell you a few stories. The first one is it's the first time I've had a call from two Yale students, two, okay, that are not Miami kids. So it's not like a Miami kid that went to Yale, right? If it's a Miami kids that went to Yale that wants to come back to Miami, I get it.

Mayor Francis Suarez:

Two Yale students that told me, "We're graduating." So these are kids that are not from Miami. So the Miami story is resonating at the highest levels. It's really something that I've never seen in my time. We have been continually exporting talent to the United States. This is the first time that we're importing talent.

Mayor Francis Suarez:

The second story I'll tell you is we created this How Can I Help campaign. We started selling tee shirts. Keith is going to get a kick out of this story. So I'm out actually at a synagogue, ironically, at a shul in downtown. I see a young man wearing a shirt with a blazer on top of the shirt.

Mayor Francis Suarez:

They start questions and answers, and I let him ask a question because he was wearing a shirt. I said, "He's got to be able to ask questions." By the way, we have a really nice one for Keith with his name on it on the back and everything. It's a jersey style. You'll like it, Keith.

Mayor Francis Suarez:

The young man says, "Look. I have never worn a tee shirt underneath a jacket. It's just not my style." He goes, "But let me tell you what happened. I was wearing this tee shirt the other day in Miami, and someone stopped me and said, 'Hey, do you have a tech company?'" I said, "Yeah, as a matter of fact I do." And he started telling about the company.

Mayor Francis Suarez:

The guy who stopped him, because the tee shirt funded his company. Okay? Funded his company. So the guy said bought ten tee shirts because he wants to wear it every day. He said, "I'm wearing the tee shirt every single day." This is unbelievable.

Mayor Francis Suarez:

I had another friend, a good friend of mine, who is a councilman in another city. He came up with a gov tech application. It's basically a bar code that goes on the back of a business card so that if an employee gives you the card you can rate the employee. It's a very simple concept, right?

Mayor Francis Suarez:

So he tweets out at me. We adopted it in the city. He tweets out at me. I retweeted his tweet. Just from this tweet four VC called him. Four VCs. So that never happened in Miami. That kind of density never was there. So that's what's changing the dynamic.

Keith Rabois:

For example, this week, just this week earlier, I think Monday morning. I was doing my normal fitness program, working out in this group fitness class, and after class this guy comes up to me. He says hello. He introduced himself.

Keith Rabois:

It turns out he runs a $100 million revenue company in Miami that nobody has yet funded. I was like, "Oh my God, where do I write the check? Where do I wire this to?" And by the way, this is great. I can justify going to fitness classes all day now.

Mayor Francis Suarez:

I was just going to say, two more stories. The guy who was buying the $50 million house in the article, that was supposedly going back to New York, he has a $20 billion hedge fund. I've never of it. Nobody else has either. It's a $20 billion assets under management.

Mayor Francis Suarez:

Next to my house, my house is certainly not at the level of all these houses, but three blocks away and four stories above my office, I'm a private lawyer as well, there's I Squared, which is a $30 billion hedge fund. I didn't know that he lived three blocks away from me. He has probably a $25, $30 million house on the water, and I didn't know him. I mean, he's been in this community for three or four years.

Mayor Francis Suarez:

So it's also a community, what's also interesting about Miami, it's changing, is there's a lot of people who want to live under the radar. They just don't necessarily want to have such a high profile. But people like Keith and myself are making it okay for them to come out. Like this particular gentleman who works at I Squared was saying, "Look. I like to keep a low profile, but I have two little kids and when I saw what you were doing, I felt an obligation to get involved. I said, I can't just be a passive participant in the city without actually taking an active role." So that narrative is also changing.

Keith Rabois:

I also think there's one other dimension that's pretty important here, which is related to that question you asked about engineers. People who live here are very welcoming to new people, partly because people have moved to Florida from other places.

Keith Rabois:

Senator Rubio pointed out to me that he thinks that Florida has the only legislature in the country where the majority of the representatives in the legislature are actually not from Florida. And three of the last four governors here were not raised in Florida.

Keith Rabois:

So the community here is very approachable for new people, where that's not always true in various places around the globe.

Michael Hendrix:

That's a great point. I also hear people expressing worries though, saying if you are moving to Florida from California, are you going to bring California's problems to Florida. The one you hear all the time is high housing costs. I know people in the chat here are asking questions about high housing costs, too. They're also talking about homelessness, crime, challenges like that.

Michael Hendrix:

Mr. Mayor, how do you respond to that fear that you're just going to bring California's problems? How do you ensure that housing remains affordable, for instance?

Mayor Francis Suarez:

Sure. Let me take the question in two parts, because that question usually gets expressed in two different ways.

Mayor Francis Suarez:

The first is a political concern, like, "Oh, are people going to bring their politics over here?" What I often remind them is, well, when we came from Cuba we did not want to import communism here. Do you know what I mean? We decided that this was the wrong ideology, so we're fervently anti-communist.

Mayor Francis Suarez:

What I've actually found is that people that have moved here by and large are fervently against the policies that they're moving away from, that they don't want to recreate those policies here. They realized that they failed. And remember, making a life decision like moving, it's a big decision. So you've got to get pushed pretty hard and pretty far to get to a point where you've decided you're going to pick up all your stuff and actually move to somewhere. That is a big decision.

Mayor Francis Suarez:

On affordable housing, I would actually say we're probably one of the best positioned cities in America to deal with that issue going forward. Let me explain to you why.

Mayor Francis Suarez:

Cities like New York and San Francisco have artificially constrained their supply. So because you artificially constrain your supply prices only have one direction to go. It's kind of like bitcoin. Right? It can only go one direction.

Mayor Francis Suarez:

In the case of us, we have the ability to grow in supply, right? In supply. From the delta the difference between what's built and what can be built is a ten to one differential. So just on the supply side we have the ability to grow. That's number one.

Mayor Francis Suarez:

Number two. When you look at the cost differential a one-bedroom in the urban core right now, unsubsidized, is $1600. Okay. Compare that to New York. Compare that to San Francisco. You're talking about $3500 in San Francisco. $3500 in New York. So the cost of living differential, that's already a two or three to one gap.

Mayor Francis Suarez:

Then the third thing is our residents have actually borrowed money, borrowed $100 million in our Miami Forever plan to build affordable housing. So we've actually as a community said, "Hey, we want have trust.” Most cities in America haven't done that. We're actually getting about a 20 to one leverage rate in the first $10 million that we allocated. So we've gotten about $200 million worth of projects for $10 million, 722 units. If you multiply that out over 100 million, that's 7200 units. That's two billion dollars for $100 of investment. We're extending our TRAs, which we've got $200 or $300 million. When you do the math, you're talking about 30,000 units and multiple billions of dollars of affordable housing.

Mayor Francis Suarez:

So we have done all that. And in the private sector we've allowed for micro units. We've allowing for co-living units right now, which also keeps the price per unit down significantly. So we're doing private sector things. We're doing public-private partnerships. We're working with our government partners. We're frankly the best-positioned city, I think in America, at least big city, to deal with affordable housing for the next 20 or 30 years.

Keith Rabois:

Yeah. A couple of data points there. Somebody tweeted this earlier this year, that Miami currently has 21 skyscrapers under construction. I haven't counted in San Francisco, but I don't know that there is total in San Francisco. And about half are residential.

Keith Rabois:

Second thing is the cost of building. In San Francisco I read a pretty rigorously researched piece that the cost of building a single unit, lowest possible cost of building it is $800,000. That's the cost. So right now, I have friends buying very nice condos in mid-town. It's a very nice area of town, for 400K. So they're buying units at half the cost of construction in San Francisco.

Keith Rabois:

That's just a structural advantage that you cannot change fundamentally. So I think the affordability is very easy to solve, and then given the land availability. I live in a very nice area of town. Within two tenths of a mile of my house, walking distance, there is five undeveloped plots of land. Right now. Available for sale.

Michael Hendrix:

And this is something I imagine folks who say, "Yes, in my backyard," in the Bay Area, have been fighting for that, have been fighting fights over laundromats that people are trying to historically preserve. All of this sounds like a completely different world.

Keith Rabois:

It feels like living on a different planet to a lot of people in the Bay Area.

Michael Hendrix:

Pivoting a little bit to education. I mean, I know that's also very important. One of the big topics right now is on reopening schools, keeping schools open.

Michael Hendrix:

What does that look like in Miami? Have the schools stayed open? And how do you keep cultivating that talent, both K-12 but also above that too, to help keep the boom going?

Mayor Francis Suarez:

First of all, our schools have been open. We're probably the first state to open schools. I have to commend the governor for that decision. He really followed the science on that, and there haven't been any major incidents, any major outbreaks or any major incidents from them being open.

Mayor Francis Suarez:

On the contrary, I think everybody else in the country has sort of realized, all the way up to the President, that keeping schools open is a main priority, particularly for families who are struggling economically. It becomes even more important for them and for their children to live as normal a life as possible.

Mayor Francis Suarez:

In terms of education, listen, this country, certainly Miami, but this country need to get the memo that technology is the future economy. Period. So our curriculums from K-12 need to reflect that. They don't right now.

Mayor Francis Suarez:

I think Miami, which won the Broad Prize for a public school system, the best public school system in the nation a couple of years ago. We have the superintendent of the year New York tried to steal from us unsuccessfully.

Mayor Francis Suarez:

We are doing a good job, but we have to do a better job. I think for us to really distinguish ourselves, that last final piece is education. It's K-12. The Knight Foundation just invested $15 million in FIU, and the University of Miami, in terms of FIU and their STEM building, and attracting the best teachers, the best professors from across the country. In the case of University of Miami in their data analytics school.

Mayor Francis Suarez:

But I think there is a reputational differential. I'm not going to sit here and try to tell you that FIU and University of Miami has the same reputation as Stanford or Harvard or MIT. That would be ridiculous, right?

Mayor Francis Suarez:

I do think there's an opportunity to bridge that gap quickly by creating partnerships with those organizations, or by telling them to send their students abroad. Not really abroad, but abroad to Miami, and having them come here and do internships at companies founded by Keith and others.

Mayor Francis Suarez:

So I think there's ways to deal with it in the short run. I think in the long run we just have to realize that a premium education is the path to success in this country. Obviously we have to continue to invest in upscaling.

Mayor Francis Suarez:

And then the last piece is we cannot forget about the grandparents in our community, for which a lot of technology, they don't really understand how it helps them, right? I would say it helps them in two ways.

Mayor Francis Suarez:

The first is their grandchildren and children stay, as opposed to leaving and not coming back. The second part is we're working with a company, I'm not sure if it's on Keith's radar yet, called Papa. Papa is an amazing company. It's going to be a Miami unicorn. What they do is they provide companionship, particularly during a pandemic, for the elderly, at no cost for the elderly through the health plan. I mean, it's incredible. I think they have 30,000 members right now. But they're going to have 30 million in a few years.

Mayor Francis Suarez:

You have to create technologies that actually help the quality of the elderly in our community. They're already doing it with Facebook. There's a lot of elderly on social media. But you've got to keep doing it with other innovative products.

Michael Hendrix:

Keith, I wonder if you have thoughts too on the talent question? I know that's important for you.

Keith Rabois:

Yeah. I mean I think the mayor's point is dead on, which is Miami's been exporting talent to the rest of the world really for a long time, particularly in the technology sector. Jeff Bezos is from here. Sheryl Sandberg is from here. Actually several of my CEOs currently in the portfolio are from here. Some I knew about that were from here. Some I actually discovered later.

Keith Rabois:

Many of them if now most actually would prefer to move back. They still have family relations here. They have great experiences growing up here. So if you did nothing else except have the talent return, that alone would provide plenty of talent for a long time here.

Keith Rabois:

Then you have the ability to import talent. I think as we have more aspirational opportunities, people who graduate from, let's say, the University of Chicago, Champlain Illinois, which is as good a CS degree as you can get anywhere in the world, or CMU, will come here. MIT come here.

Keith Rabois:

It will take time to build educational institutions. You don't turn brands in education overnight into MIT, Stanford, Harvard, etc. But you don't need to either. You can just constantly improve every year and that compounds. Ten years later and it is a first-rate institution.

Keith Rabois:

For example, there's a university in Massachusetts that done a phenomenal job in really resurrecting and improving their brand. I think there's some opportunities to create remote campuses for highly successful and hearing-based school. Think like in the Mid-West, etc. Stanford even had to put a campus in New York for a variety of reasons.

Keith Rabois:

So I think there's lots of opportunities to sort of take shortcuts. But I think bottom-up building is the best way to do it for a long-term sustainable ecosystem. But we don't really need to. We just need to have people who were born and raised here, who have incredible talent, to want to return because they feel there's opportunities. All I hear from them all day long is, "How fast can I come back?"

Michael Hendrix:

And Mayor Suarez, we also can't forget immigration which has been absolutely central to the story, to your story, to Miami's story. How have Covid travel restrictions, declining international travel effected the city and immigration in the short run? And kind of in the long run, how central is immigration to Miami's future?

Mayor Francis Suarez:

I personally think it's very central. It's part of all of our stories. I mean at some point or another one of our predecessors immigrated to this country. This is a country that was created by immigration.

Mayor Francis Suarez:

So for me, it's an issue particularly pre-pandemic, where we were at full employment. We need to start thinking about the conversation a little differently. We've got to start to start thinking about it as we're having a hard time hiring people oftentimes. We're having a hard time finding people that want to do certain jobs.

Mayor Francis Suarez:

So we need more help. We need more people that want to do it. What's beautiful is the upward mobility in this country. If you want to study, if you want to learn, you an get upskilled. You can have upward mobility in this country. It's one of the few countries, in America, that allows the maitre d' at a hotel to be the hotel manager, the doorman in a hotel to become the general manager of the hotel.

Mayor Francis Suarez:

It happens all the time. That's the beauty of this country. I think Miami was built on immigration, and I think that's part of our success, to Keith's point about our diversity.

Mayor Francis Suarez:

People feel comfortable when they're here. We want them to feel comfortable. We want them to feel welcome. It's kind of like a big-city-small-city feel. We're kind of a big city, but we have a small city feel.

Mayor Francis Suarez:

We all know each other. We take care of each other. We look out for each other. We protect each other.

Michael Hendrix:

And, Mayor Suarez, your father immigrated to the US from Cuba when he was young, went on to study law at Harvard, if I remember correctly. And then became mayor of Miami himself. That seems like a great example of that American dream. I mean, as you reflect on that, how did America's culture and policies help make that possible? How has that shaped your own understanding of what the American dream is?

Mayor Francis Suarez:

It's been incredibly influential. I mean, my mom came when she was six. My dad came when he was 12. If we didn't have that opportunity to come legally to this country, who knows what I would be doing right now? God knows.

Mayor Francis Suarez:

But my dad's story is an amazing story. He's the ninth of 14 children. My grandfather was an academician. He was a dean of the engineering college of Hanoi University in Cuba. He's one of the smartest people that I know.

Mayor Francis Suarez:

My dad is a genius, literally a genius. He learned the language at 12, took the SAT at 17. Or started learning the language at 12. Came to this country at 12. Learned the language by the time he was 17. Took the SAT, got almost a perfect score. Got a presidential scholarship, which they give out one a year at Villanova University for mechanical engineering, where he graduated summa cum laude in mechanical engineering.

Mayor Francis Suarez:

That is not easy to do, folks, okay? For the mechanical engineers in the room, they know what I'm talking about. There are professors that are still alive at Villanova that think he was the smartest student that ever went there. Okay?

Mayor Francis Suarez:

And then his encore to being summa cum laude, was to get two graduate degrees from Harvard, a master's in public policy and his law degree. Master of Public Policy from the Kennedy School at the time. The Kennedy School was the only school in the world to have the Master's in Public Policy. It was a quantitative approach to public administration.

Mayor Francis Suarez:

And he's written eight books, or nine books in his life. Speaks four or five languages. So I mean, if I had half the intelligence that he has, I probably could run for President of the United States.

Michael Hendrix:

And you are yourself a mayor of Miami, and that is nothing to laugh at. That is an impressive achievement. And you are now here to spend some time from Miami. It's a terrific story.

Michael Hendrix:

Keith, I do want to jump in and point to you as well. I mean, you also have an incredible story, and the companies you've been founding have also been part of America's success over the past handful of years. How do you hope that your story will play into Miami's future and its success?

Keith Rabois:

Well, I think there's several closes. I think setting an example, obviously encouraging people to escape jail basically and vote with their feet. That helps everybody because it helps build high paying, prospectively interesting jobs here.

Keith Rabois:

But it helps politicians to correct their insane dysfunctional policies because they're going to lose all their voters. I mean California in the last census lost a congressional seat, I think for the first time ever. Certainly for the first time this century. It's going to lose more congressional seats in the next census unless there's a radical change, like the governor's recall which probably will happen actually.

Keith Rabois:

But in any event, I think setting an aspirational example for people relocating to places that are more friendly, more aspirational. More people emulate success as opposed to penalize success. Then encourage people to fix their policies where they're broken.

Keith Rabois:

Second, create jobs. Like literally, directly create jobs. So we're hiring in Miami. We have an office east of Miami. We scaling from six to eight people to 20 people very quickly. We'll be hiring more as we get signals from the market that what we're doing is working.

Keith Rabois:

Then encouraging other people to move here, and create more jobs. So PayPal wasn't just a success for individual employees. It wasn't a success for investors. What PayPal really did was empower anybody to become an entrepreneur, anybody to become an entrepreneur on the web, or in the real world.

Keith Rabois:

Before PayPal, the process of getting, accepting payments was basically the province of the elite gatekeepers. You literally had to apply. It could take weeks and months, and you had to fit all this criteria, including like Social Security numbers and credit checks.

Keith Rabois:

We basically said, "Wow, you're never going to create a business with something you can't accept the credit. Visa, MasterCard, AmEx etc. We're going to make everybody eligible to become an entrepreneur. That's what actually fueled a lot of people creating their own businesses successfully.

Keith Rabois:

Then we did that in some ways the same playbook, but more offline than online for Square. So empowering people. Kind of the old Jack Kempian language, but basically that's what we did. We basically empowered people with tools to build their own businesses fore their future. So that's what we aspire to do with all of our companies.

Michael Hendrix:

That's incredible. And Mayor Suarez, final thoughts. This event is called The Case for Miami. You want into an elevator and you have to make that elevator pitch for Miami. What is it? Give it to us.

Mayor Francis Suarez:

Well, it's very simple. We're going to continue to do the simple things to make us successful and the most successful city in the world.

Mayor Francis Suarez:

We're going to keep our taxes low. We're going to increase police so that we have the safest big city in America. We're going to get to functional zero on homelessness. And we're going to invest in quality of life.

Mayor Francis Suarez:

So the better question for you is not whether you should move to Miami. The better question is, why haven't you already moved to Miami?

Michael Hendrix:

And with that, thank you both. Mayor Suarez, Keith, thank you for joining us today. This has been a terrific discussion.

Michael Hendrix:

To all of those watching, this has been a Young Leaders Circle event with the Manhattan Institute, our program for young professionals. We welcome you to join and follow. Thank you for tuning in. If you like what you saw, subscribe, support us, follow us online. We're even on Clubhouse now. Thank you again for tuning in, and have a great day.

Mayor Francis Suarez:

Thank you.

Keith Rabois:

Thanks.

communications@manhattan-institute.org