Texas Business Outlook (Austin, Dallas, Houston)
Equities in Dallas was long considered a joke, but the growth of Austin, Dallas, and Houston has me considering a move. Any monkeys have any takes on these Texas cities? Curious about the PE/VC landscape or just general business landscape as well as culture of the cities listed.
It seems like Miami seems to be gaining momentum in the finance world, so I was curious if any monkeys in Texas have noticed a similar influx of financial firms/ activity. Would love to hear about a major breakdown of firms in the state as well.
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I would post this in the off topic forum if you want to get some takes on the cities themselves.
Recently saw Lazard post a growth equities/venture financing job in Austin, and I know from fellow alums/students that have been raving about how the standardized pay in Dallas for Goldman’s AM/RE is pretty great. Additionally Houston has always been a great spot for energy banking and that’s true to this day. I would say the current division for buy side is like Houston - Energy PE, Dallas - REPE, and Austin - VC.
Obviously the size of these markets don’t compare to the coasts other than with energy if you’re into that. Honestly see if Texas is a cultural/QOL fit. Your dollar will go farther and maybe the climate/crowd suits you better than Florida. Definitely greater VC growth in Austin compared to Miami. Hours will be the same, work will be similar, but the people and the infrastructure you’re surrounded with will differ compared to traditional finance cities (NYC/SF/Chicago).
When I left Austin in 2018, I'd already watched it grow rapidly for 7 years and seemingly reach a capacity in terms of roads, public resources, enjoyable space, character, cost of living etc etc. The boomtown narrative was old news by that point, and a leveling-off seemed imminent.
How weird it was, then, to see a full 2nd wave in the wake of Covid and hear people still to this day speak of Austin like the next big thing. To me that's like when may parents say "boy that Netflix sure does sound interesting."
So clearly I'm not very good at calling tops in cities. But my advice would be that if you're moving to Austin, make sure you're very excited about the specific job and not moving there on the theory that being part of a "growth hub" is going to compensate for any shortcomings in the specific job. You could do that in 2015 (people would be like "just get me to Austin") but not today. Supply of finance labor down there has picked up, and demand isn't outstripping nearly as much as it used to. I'm sure there's plenty of great stuff there, especially in VC, but just saying be ready for a more mature market.
I like Dallas a lot. Not sure why more people don't. Houston is great if you can survive the summer, but not everyone can.
You seem to have been on this website for a bit and sound experienced from your posts, also read a few comments you made and it appears you are a booth alum, so let me make the question more explicit:
I’ve lived in NY, SF, and CHI. I can’t stomach raising a family in the NY burbs or SF burbs and CHI seems to be circling the drain due to the state of Illinois and the city itself continuously being anti-business with horrible leadership. I’m trying to figure out where I want to raise a family that’s most similar to CHI that has a better economic outlook.
The Austin/ Dallas/Houston areas sound like they are major metro areas that are growing in a pro-business state. I’m trying to wrap my head around the 10 year outlook for the finance world in those areas. Does Dallas/Austin/Houston have strong MM/LMM PE firms? Aside from Austin growing in tech, is it really just like energy in Dallas? That seems like it’s like how people classify Chicago as just industrials when really there’s a much larger presence of other industries, mainly healthcare that exist.
There's a lot in Dallas that's not energy related. If you google around and check other threads on this site there's an easy path to a list of diversified strategies that you could target based on what you're looking for.
If you don't mind posting with your username, I can DM you -- I work at a fund in one of these cities.
Not a ton of true MM+ funds in TX, but there are a handful of strong names. If you search or check my comment history you’ll find the posts pretty quickly.
Quite a few LMM funds. Houston is dominated by industrials and energy. Austin is tech and real estate. Dallas is credit, real estate, energy, and starting to be healthcare. Quite a few family offices in DFW as well - usually stemming from oil money but diversifying away.
TX markets are definitely growing, but I feel like the growth in finance is lagging relative to traditional F500 companies. The hiring market continues to be dominated by schools like UT, A&M, and SMU, followed by like SEC and Big 12 schools. Great place to hire people for like marketing, HR, or IT who don’t need to sit on the coasts and can live on $60-80k a year, but the message I hear from bigger firms is that they like the idea of having TX offices and the number of qualified candidates is growing but still much smaller than traditional cities.
Dallas (where I’m most familiar) tends to have lots of people who were in Southern / Midwestern fraternities and love golf and college football (guilty as charged) - not as SEC-focused as say Atlanta, but can be a similar vibe. Socially it can be very clicquey if you’re outside those groups. Great place to live comfortably if you fit in culturally and want the classic white picket fence house and don’t mind traffic. Not nearly as cheap as it used to be, but you do save on taxes. Not a ton culturally that is really “uniquely Dallas” (Fort Worth actually wins there… don’t tell anyone in Dallas I said that), but for what most people actually take advantage of regularly (bars, sports, etc.) there’s plenty. Some good restaurants, but overall I think we’re lacking a bit on that front. Easiest city for travel in the country (along with maybe Chicago) - nothing’s super close, but everything is only a 2-3 hour flight.
Austin is cool but overrated in my opinion. Haven’t lived there but visited plenty, and it feels like it overgrew its infrastructure a decade ago and hard to see why it merits the cost. Still a solid city, I just don’t buy into it being the place to be, and it’s rapidly growing crazy expensive. People can be a bit up their own ass about how they live somewhere cool (feels kind of like LA in that regard), and it feels like a lot of the crowd that wants to pitch you on their latest startup ended up here. Best nature of the big Texas cities by far. Less conservative than the other two.
Houston business feels very old school to me, but I’m not as familiar. Great Asian and Mexican food scenes, much more international culture. City itself is pretty meh.
We don’t talk about San Antonio. They’re their own thing and like it that way.
Thank you!
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