Tuesday, July 28, 2026

The conventional story about tech wealth is that it spreads. A company goes public, employees scatter, secondary cities benefit, and the money radiates outward. Three decades of data tell the opposite story. IPO-driven wealth pulls money, talent, and services into a tighter and tighter footprint, and each cycle narrows the geography further.

The next wave is already arriving. SpaceX's IPO earlier this year sent billions to employees based in the Bay Area. OpenAI and Anthropic are expected to follow, together creating about 12,000 new millionaires concentrated almost entirely in San Francisco.

Every previous round of tech IPO wealth has concentrated in the same few cities rather than diffusing outward. The AI boom, which is larger than any of its predecessors, is following the same path.

San Francisco tried and failed to tax its way into a fix. In 2019, the city tabled a proposed tax on stock-based compensation that would have raised the rate on that form of pay from 0.38% to 1.5%. The city's Office of Economic Analysis had estimated it would generate $50 million to $150 million per year for affordable housing, family programs, and small business stabilization. But the track record for local tax fixes isn't encouraging.

Last week, Nvidia was among the signatories of a letter urging policymakers to avoid restrictions on open-weight models. Nvidia argued in its blog post that sweeping curbs on open frontier AI would erode defenders' capabilities while funneling control toward a handful of closed-model providers.