Two events in the last year dramatized the impact the tech sector is starting to have on Los Angeles.
Over the summer, Steve Ballmer, former chief executive of Microsoft Corp. who’s worth $22.5 billion, plunked down $2 billion to buy the Los Angeles Clippers basketball team, easily vanquishing other bidders and boosting the valuations of sports franchises across the country.
In March, Venice disappearing-photo app maker Snapchat Inc. closed another round of funding that brought its valuation to an estimated $15 billion. In the process, its co-founders, Bobby Murphy and Evan Spiegel, 26 and 24 years old, respectively, joined the ranks of local billionaires.
Los Angeles has always been a haven for the super wealthy, whether they grew up here, moved here or just used the temperate climes and laid-back lifestyle as an excuse for another holiday getaway home. But over the last few years, the region has been awash in tech money – some locally grown, some transplanted – that has begun to reshape the region.
The tech sector this year dominates the Business Journal’s list of Wealthiest Angelenos for the first time. Of the 50 billionaires on our list – another first, never before have all 50 been valued above $1 billion – eight trace their wealth to the tech sector. And they are not just slipping on to the list. Although L.A.’s tech billionaires represent 16 percent of the top 50, they account for 20 percent of all wealth on the list.
It’s a signal of a paradigm shift in the nature of the L.A. economy. Its newest billionaires are those who successfully capitalized on, and in some cases ushered in, technological innovations that have revolutionized the way society communicates, interacts and gathers information. Their impact is being felt not just on smartphones and tablets around the world, but in the price of housing here and, increasingly, even in the creative office environments many Angelenos work in each day.
Six of the nine are part of a new generation of tech titans, those who made their fortunes in the wake of the dot-com bubble more than a decade ago. But there is still some significant old-school tech money kicking around, characterized by individuals whose companies are essentially manufacturing businesses that produce high-tech goods. Just look to Kingston Technology co-founder John Tu (No. 7), whose $6.5 billion fortune is built on selling memory cards and hard drives, or Aubrey Chernick (No. 41), who founded operational software company Candle Corp. back in 1976.
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