Quake Capital moved HQ from NYC to Austin chasing 25,000 engineering grads (interview)

Talking to Crunchbase News in November 2018, Quake Capital founding partner Chad Burgess explains why the early-stage fund and accelerator moved its headquarters from New York to Austin that July, keeping its New York and Los Angeles offices. Austin was absorbing an influx of VC firms — 'Peter Thiel, I'm looking at you', the article notes — drawn by housing costs and the local talent pool.

Burgess's math was about people. 'You've got 25,000 undergrad engineers coming out of those two schools alone' — the University of Texas at Austin and Texas A&M — plus intern pipelines from Rice University and the University of Houston. Taxes, quality of life and affordable housing completed the case: in LA and New York, he says, 'unless you just make a lot of money, you're kind of a renter for life', while in Austin 'people can actually buy a house'.

Quake also avoided Silicon Valley on purpose. 'There's a lot of noise per capita' there — venture dollars vastly outnumber startups, so an investor is one of thousands. Austin, by contrast, has 'a lot of startups but not a lot of venture dollars. This approach fills a very big need and void.'

Founded in January 2016, Quake began investing in early 2017 out of a $4.65 million fund and backed 31 companies with it. At the beginning of 2018 it started investing out of its second fund and was already raising for a third, with a target of $125 million. Each office planned to invest in 30 companies a year — about 90 in total. 'We're going to be expanding pretty fast,' Burgess said.

By November 2018 Quake was investing out of a second fund and raising a third at a $125M target, versus its $4.65M first fund (self-reported in the interview).

Talent supply is the binding constraint on an early-stage firm: Austin's two big engineering schools alone graduate about 25,000 a year.

Affordable housing is a recruiting weapon — hires can buy homes in Austin that New York or LA salaries cannot touch.

Moving toward capital scarcity makes a fund a needed partner rather than one more check in a crowded market.

Keeping the New York and LA offices turned the relocation into an addition, not an exit from either coast.

An office is a talent decision: locate where the engineers graduate and where housing lets them say yes, and set up where capital — not founders — is the scarce input.

By the November 2018 interview Quake was investing out of its second fund, raising a third at a $125 million target (self-reported), and planning roughly 90 investments a year across three offices. Crunchbase News framed the move as part of the broader VC migration into Austin.