Just 15 miles across the Potomac River from the marble and granite monuments built during 224 years of democracy, the acronyms of Washington have been newly scrambled. You won't find the FTC, the FBI or the DOD; but you can't miss the shiny new glass-and-stone headquarters of UUNet and PSINet, AMS and UUcom, commercial titans of the new Washington. You can't miss the new-economy
entrepreneurs in their Lexuses and Land Rovers doing deals on cell phones as they zip around I-66 and Routes 7, 50 and 123. And you certainly can't avoid the traffic. Fifteen years ago, Fairfax, Loudoun and Arlington counties in northern Virginia were nothing but sleepy residential communities and remote farmland, places to drive through on the way to Dulles Airport or concerts at Wolf Trap or camp sites near Front Royal. Now this 1,400-sq.- mi. area of northern Virginia is threatened with becoming a concrete-and-asphalt expanse of office buildings and parking lots, home to hundreds of new dotcoms, telephone companies, wireless firms, Internet-service providers and venture capitalists--home to everything that makes the new economy the powerhouse that it is.
"Washington isn't just a government town anymore," observes Treasury Secretary Lawrence Summers, who recently ventured all the way out to speak to a gathering of new CEOs at the Tower Club. "The synergy of telecommunications and the Internet has created a boom." And this is a boom with cultural as well as economic consequences. The thousands of companies that dapple suburban Maryland and Virginia don't face the Pentagon or the Treasury anymore: they face Fairfax County, Va., where the real money is. "The best thing governments can do is stay out of the way," says a prominent northern Virginia venture capitalist, voicing a common if ironic sentiment in the heart of the region that created the Internet. But official Washington isn't about to disappear. Administration officials, Senators and members of Congress--and, more important, the fund-raising arms of their political parties--are making it a point to know who's who in the local tech world. "We have no problem getting our phone calls returned," says John Backus, chairman of the Northern Virginia Technology Council (NVTC), a business-promotion group.
Welcome to Techtopia
In the new Washington, money talks. Suburban Fairfax County (which bills itself as "E-county") recently became the richest county in America, with a median household income of $90,937. An estimated 2,000 high-tech firms are on hand there, helping attract 20,000 new residents each year. A decade ago, the main Fairfax shopping center, Tysons Corner, was just a big mall. Today Tysons is the 14th largest business district in the U.S. It consists of two strip malls and two mega-malls near one another, with 80,000 people working in the vicinity and dozens of high-end outfitters--like the local Tiffany & Co., which outsells the company's flagship store on Manhattan's Fifth Avenue.
With all that has been going on, venture capitalists were sure to follow. There are 20 venture-capital firms with offices in Fairfax County alone. They include Draper Atlantic and Friedman Billings Ramsey. Fairfax County firms obtained $327 million in venture capital during the first quarter of 2000, well above the pace of almost $1 billion for all of 1999. Meanwhile, more than 150 foreign businesses, including giants like Cable & Wireless and Hitachi Data Systems, have parachuted into Fairfax County, and the Fairfax County government has established offices in London, Tokyo and Frankfurt. Says Alan Merten, president of George Mason University, the region's most tech-focused academic center: "The Washington region has become a global player."
Nor is the boom confined to the dotcom universe. In nearby Montgomery County, Md., just north of the District of Columbia, a new set of novel names and acronyms studs the suburban landscape. Biotechnology start-ups such as Genetic Therapy, Human Genome Sciences and GeneLogic and established health firms such as EntreMed and MedImmune fan out around the National Institutes of Health in Bethesda. Two hundred of the 300 biotechnology firms in Maryland are located in Montgomery County, whose median household income is $77,774 (ninth nationally). Montgomery County ranks sixth in the nation as having households with incomes of $500,000 or more. Like that in northern Virginia, the high-tech corridor in Maryland is congested with traffic. Commuters who try to use public transportation like the subway find that the vast parking lots in even the most distant suburbs are full by 8 a.m.