Forgot your password?
Close
typodupeerror
Stats AI Businesses United States

'Billionaire Exodus? California Drew 10x More Venture Capital Than Any Other State This Year' (yahoo.com) 94

Posted by EditorDavid from the sunshine-states dept.
California drew more than $335 billion in venture capital funding this year, reports the Los Angeles Times, citing data released Thursday by PitchBook on private market funding: Its next biggest competitor, New York, raised less than a tenth of California's total. Texas raised 1/40th of the amount... Although a campaign for a new tax on billionaires has convinced some ultra-rich residents to shift to other states and businesses often complain that high property and energy costs and an anti-business regulatory regime make it too tough to make money in the state, the inability of the top talent, companies and investors in AI to set up elsewhere shows California's enduring attraction.

The state's economy grew 5% last year to a record $4.25 trillion, making it larger than every country other than the U.S., China and Germany. It is home to nearly 400 billion-dollar startups — more than any other state, according to CB Insights... Among metropolitan regions, Los Angeles ranked behind only Silicon Valley and New York, which attracted $98 billion and $11.5 billion in venture investment, respectively... Investors poured in nearly $8 billion across 207 deals in the Los Angeles, Long Beach, and Santa Ana metro areas, up 28% from a year earlier, according to PitchBook...

Nearly 90% of invested dollars [in California] went to AI firms, up from last year, when around 65% of new funds were allocated to AI. "If you're a tech company and you're not an AI company, you have a very, very difficult opportunity ahead of you to raise capital," Stanford said.

'Billionaire Exodus? California Drew 10x More Venture Capital Than Any Other State This Year' More | Reply

'Billionaire Exodus? California Drew 10x More Venture Capital Than Any Other State This Year'

Comments Filter:

  • Leaving. Billionaires or billionaires' money? (Score:5, Insightful)

    by Todd Knarr ( 15451 ) on Sunday July 12, 2026 @07:56PM (#66235174) Homepage

    Sure the billionaires can leave CA. No loss there, because their money will stay there. That's where the businesses they want to fund are. That's where the talent they want to attract is. And billionaires themselves pay jack shit in taxes, it's the businesses that the money's in that matter. And for that matter, where are the billionaires going to move? Manhattan, Kansas?

    • Re: Leaving. Billionaires or billionaires' money? (Score:4, Insightful)

      by kenh ( 9056 ) on Sunday July 12, 2026 @10:30PM (#66235316) Homepage Journal

      If the billionaires leave, their wealth goes, and then CA doesn't get to collect their billionaires wealth tax of 5%.

      The issue is the tax on wealth, it has nothing to do with the companies (companies don't have to pay wealth taxes, just individuals), so a company like Apple with billions of dollars doesn't owe 5% of their holdings to the state, just the less than 300 individual billionaires that live in the state.

      Sergei left CA to avoid the tax, Google is still in CA, Sergei wont pay the 5% tax CA loses.

      None of this has anything to do with Venture Capital

      • Re: (Score:2)

        by kwerle ( 39371 )

        so a company like Apple with billions of dollars doesn't owe 5% of their holdings to the state, just the less than 300 individual billionaires that live in the state.

        I feel like I need to spell out the math.

        300 * 1,000,000,000 = 300,000,000,000
        300,000,000 * 5% = 15,000,000,000

        That's all CA will get from the one time tax "from Apple". Just 15 Billion Dollars.

    • Sure the billionaires can leave CA. No loss there, because their money will stay there.

      The 5% tax is a wealth tax.

      The wealth tax is paid by individuals that reside in the state.

      When the individual moves out of state, like to Florida as a Google founder did, they are no longer a resident of CA.

      Being a resident of FL, they do not owe CA the 5% wealth tax.

      The billion dollar company (like Google) may stay in CA, but the state can't collect the wealth tax from the billion dollar corporation.

      • Re: Leaving. Billionaires or billionaires' money? (Score:5, Interesting)

        by Todd Knarr ( 15451 ) on Sunday July 12, 2026 @11:49PM (#66235412) Homepage

        That works short-term, but then they become a non-resident with CA-based income which means they have to file CA taxes under non-resident rules. Much less favorable, and leaves them open to CA doing any number of things to tax rules. One would be considering loans secured by stock options (not actual shares) to be income.

        • Not necessarily. They can fiddle with that in a number of ways. The most obvious being that they can often take a very small salary and pay themselves in stock instead, or they can just pay themselves in the State they moved to. Worst case, they can say their corporation is based wherever they want.

          I don't think you can do what you suggest with loans. Loans are a liability, not a taxable asset.

          • Half my salary at my old job was paid in stock. I assure you, both the federal and state government consider it income. I pay taxes on the cost basis, same rate as any ordinary income on a W-2. The I pay taxes again when I have realized gains.

            • That's actual stock, not options. Incentive stock options (the kind executives receive) don't count as income until you sell the stock after exercising the options. Take out a loan against that stock and you've got dollars in your bank account you can spend but no income to report. Now, suppose the loan's structured so that, as long as the stock is worth enough to cover the principal plus accumulated interest, you don't have to make payments on the loan. Do this through a trust so your heirs don't have to w

    • Re:Leaving. Billionaires or billionaires' money? (Score:4, Funny)

      by mjwx ( 966435 ) on Monday July 13, 2026 @07:39AM (#66235752)

      Sure the billionaires can leave CA. No loss there, because their money will stay there. That's where the businesses they want to fund are. That's where the talent they want to attract is. And billionaires themselves pay jack shit in taxes, it's the businesses that the money's in that matter. And for that matter, where are the billionaires going to move? Manhattan, Kansas?

      Pretty much this. The right kind of rich are leaving, the ones that aren't productive, don't invest in the local economy and pretty much demand to pay no tax... they're fleeing to whatever tax refuge they can get. The ones who actually do something, invest in things, things that have jobs, they're not fleeing.

      The one's fleeing are essentially tax refugees... seeking asylum from their obligations. Good riddance I say and nothing of value was lost.

    • Sure the billionaires can leave CA. No loss there, because their money will stay there.

      By "there" you mean "the money will remain in California". To an extent, yes. You can live in Austin and found a company where most of the workers are in San Jose. That's just inefficient and a pain. It makes it more likely that, at the margin, a founder will decide Austin is good enough, and hire there.

      And billionaires themselves pay jack shit in taxes,

      Can't let that slide. Wealthy people pay the lion's share of income and capital gains taxes, both federally and in California. They pay both more dollars and a higher proportion of income than poor people. T

  • Going to be interesting in CA (Score:5, Informative)

    by oldgraybeard ( 2939809 ) on Sunday July 12, 2026 @08:19PM (#66235202)
    Once, the one time 5% is spent the state will have to figure out how to do the one time 5% more than once to keep feeding the spending machine.
    The problem is Fraud, Grift and run away Government spending can not co exist so they will need to do something different at some point.

    • Oh, what, like the current federal administration? Lol.

    • > Once, the one time 5% is spent the state will have to figure out how to do the one time 5% more than once to keep feeding the spending machine.

      The money to be raised is already budgeted as a separate fund for a specific purpose. It is not intended to be general funds nor is it intended to be ongoing funding.

      Think of as a bond. When the government wants to raise money for a project or investment in the future, they will often issue and sell bonds to raise that money. Bonds mature and pay back with some

      • The money to be raised is already budgeted as a separate fund for a specific purpose. It is not intended to be general funds nor is it intended to be ongoing funding.

        That sounds great, did they also budget for a third of the targeted billionaires leaving the state to avoid the 5% wealth tax? I think not - CA thinks it's so special they can try and seize 5% of billionaires wealth and they'll stick around! LOL, other states have sunshine, and beaches, and lower property/income taxes...

    • ... need to do something different ...

      Wasn't " Fraud, Grift and run-away Government spending" fixed by DoGE? California can just do what DoGE and the GOP did: Lower taxes and divert billions to another can't-win war. I recommend that California declare war on Texas: Take advantage of recent experience bombing oil-fields.

      Problem solved: I'm sure the billionaires (and you) will be very happy.

      • Re: (Score:1)

        by Anonymous Coward

        Except Trump has been very careful to not bomb the Islamic terrorist oilfields in Iran.

        To do so would be trivial. It's what your Islamic terrorist friends would do. But Trump is far more honorable than them.
        Trump is focused on the terrorist IRGC and degrading their ability to terrorize all the innocent parties trying to transit through Oman's sovereign territorial waters.

        Why aren't you saying thank-you, but instead supporting the terrorists?
        No you can't have Sharia Law in the west. Or nukes for Iran.

      • fuck off Islamist terrorist. (Score:1)

        by Anonymous Coward

        Surprise surprise

        Kuwaiti authorities have now confirmed that Iranian one-way attack drones targeted the country’s oil infrastructure during the recent retaliatory attacks launched by the Iranian Armed Forces

        It's Iran trying to blow up everyone else's oil infrastructure. Just like you were told

        Top official of IRGC Air Defence Hamidreza Dehghan, who threatened to make the entire Middle East a graveyard of American soldiers yesterday, has been eliminated in today's airstrike by the United States Forces.

        America is taking out the terrorist leaders instead.

    • Re: (Score:3, Informative)

      by SoftwareArtist ( 1472499 )

      The problem is Fraud, Grift and run away Government spending can not co exist so they will need to do something different at some point.

      Are you suggesting California is particularly bad for those things? It's easy to look up data, you know.

      Here is data on government corruption [worldpopul...review.com]. Louisiana is the worst with 1.05 convictions per year per 10k government employees. California is better than average with 0.25. The very best state is New Hampshire with only 0.07 convictions per year per 10k government employees.

      Runaway government spending is a bit harder to measure objectively, but is government debt [us-debt-clock.com] a reasonable measure? California is right

      • "Are you suggesting California is particularly bad" God No! I live in MN where the PAN(Politician-Activist-NGO) grift is still purring along.
        There are few things more dangerous to taxpayers than an Activist with a public service job.

      • Here is data on government corruption. Louisiana is the worst with 1.05 convictions per year per 10k government employees. California is better than average with 0.25.

        Rating corruption based on convictions? That's a terrible measure. I can assure you there's few convictions in Russia and China, for instance.

    • Re: (Score:2)

      by hwstar ( 35834 )

      The nice thing about CA is for most things it takes voter approval to raise taxes due to proposition 13. This means they would have to another ballot proposition all over again.

      • Proposition 13 is about property tax. Newsom and Sacramento cooking up a HUGE meal of new taxes like Virginia because they've already run the numbers on how much of the "billonaire wealth" has already left. CA State gov is lookkng at a 30% loss of tax revenue instead of a $100 billion increase.

    • Once, the one time 5% is spent the state will have to figure out how to do the one time 5% more than once to keep feeding the spending machine.

      Oh that's an interesting concept. What we could do is do it every year, put in place a legal system to manage it. Actually we could also recongise that the single figure doesn't suit everyone perfectly and have them make filings if they want to deviate from it. Then we could for want of a better word "return" the money.

  • They can take their robotaxis, scooters, ebikes and everything else with them.

    In Silicon Valley's effort to try to force us all to pay more money for things that we don't want... good riddance. For the increasing cost of living... good riddance. Silicon valley has been measurably making the life of normal people worse this last 10 years. I don't want to need to own a smart phone that will track me everywhere just so I can unlock the doors at my apartment complex.

    Just go somewhere and die.

    • They can take their robotaxis, scooters, ebikes and everything else with them.

      Nah, the dockess ebikes are really popular for good reasons.

      I mean sure lots of people complain bitterly about them "taking up space" but somehow the 40% of people gifted land for free car storage in my part of London never get a mention in this whole "taking up space" argument.

      Lime isn't 100% without problems, but providing effective, theft resistant, low impact point to point transport when the rest of the options are often stuc

  • That's how they get rich, taking advantage of options and fucking the rest of us over. Eat them.

  • "The place is too crowded, nobody goes there any more."

  • The billionares can leave, but they're (Score:4, Insightful)

    by hwstar ( 35834 ) on Sunday July 12, 2026 @09:55PM (#66235276)

    going have a hard time attracting the best employees who want to live in California for numerous reasons:

    1. Weather
    2. No non compete agreements
    3. Better healthcare
    4. Cleaner air and water
    5. More things to do in your spare time in the state.
    6. Initiative and Referendum unlike half of other states

    So the Billionaire can leave, but he'll end up controlling his company remotely from out of state unless he can do everything with AI or make do with mediocre employees or use AI and have a few less-than-stellar employees for grunt tasks.

    • Re: (Score:2)

      by tlhIngan ( 30335 )

      So the Billionaire can leave, but he'll end up controlling his company remotely from out of state unless he can do everything with AI or make do with mediocre employees or use AI and have a few less-than-stellar employees for grunt tasks.

      And then wait for California to introduce a law that if the CEO works remotely from the company, then workers are allowed to work remotely as well. And by remotely, I mean the CEO lives in a place where no substantial office of the company exists. So if they live in Florida

    • AI doesnt care about weather, clean air, healthcare, recreational opportunities, etc.

      Good luck!

  • OpenAI and Anthropic pulled the numbers higher, without them it wouldnâ(TM)t look that good.
  • This might be a shock to the LA Times, but people don't have to live in the same state as the companies they invest in are headquartered.

    • I'm amazed to find your comment is an isolated example of reading comprehension and critical thinking.

      Many others are 'accepting the premise' and 'entering the frame' of the LA Times weirdos.

      Didn't expect that today.

    • And how will those companies perform business inside California without any wealth?

  • Venture capital does not mean people giving that money are living there?

  • wait, Billionaires *do* have too much money

Slashdot Top Deals

If I were a grave-digger or even a hangman, there are some people I could work for with a great deal of enjoyment. -- Douglas Jerrold

Close