Sparks

The other half of the Texas

 By Mattia Ferraresi

It was a particular combination of circumstances in the early 2000s that projected Austin into the energy world. On the one hand, the dot com bubble had led to a slump in the tech industry, while on the other, rising prices were strengthening the oil sector. This city-incubator has witnessed the birth of dozens of young companies oriented to the optimization of the energy industry, an issue that is particularly relevant in a period of declining crude oil prices. Mattia Ferraresi explains how the digital revolution and the old Texas oil industry have embraced in this paradise for Millennials, with their long beards and craft beers…

In the sixties Willie Nelson concerts were full of cowboys and hippies. That they would often end often in brawls was only natural. But the cowboys liked the country soul of his music and the hippies liked the rock energy, and, as no one wanted to give up their idol, Nelson invented a genre somewhere between the two and called it “outlaw” music , and invited the factions to bury the hatchet. More than a truce it was an embrace. It was the beginning of the “Austin model”, named after the capital of Texas where opposites not only coexist, but hold hands. Michael Webber, a professor of engineering at the University of Texas, is sure that if Austin has become a hub of energy, even though it is not an “oil city” it is because of the spirit of cooperation embodied by Willie Nelson. The digital revolution and the old Texas oil industry have embraced in this paradise for Millennials, with their long beards and craft beers. As well as teaching mechanical engineering, Webber is the deputy director of the Energy Institute and director of the start-up accelerator for renewable energy sponsored by the university, heading up a team of twenty researchers and six media experts, because a large part of his mission is to ‘”educate the world about the energy sector.”

A few years ago students who stopped after class to discuss energy issues became so many that one evening he decided to invite them for a beer (or maybe two) at Uncle Billy’s in order to continue the conversation. That evening led to Clean Energy Beers: meetings held on the first Friday of the month to which everyone is invited to take part in a discussion without lectures or moderators. You can say what you want, as long as you deal with one of three topics: clean energy, beer, barbecues. “On average, we have between eighty or ninety people, and it has become a place to exchange ideas but also for networking. There are people who find work or come up with innovative ways to grow their businesses, some people have also found a wife or husband,” Webber laughs – but it’s no joke. It’s something that elsewhere might seem bizarre. But not in Austin.

(SXSW is the festival of music, technology and visual arts that every March, since the mid-eighties, sets the agenda for the culture of innovation in the world)

The city became a focal point in the technology landscape during the eighties for various reasons, one of which is the University of Texas, with its engineering vocation, a campus with fifty thousand students and where the hard-working and carefree climate that you breathe provokes desire to go back to school. A blackboard at the entrance of the Faculty of Engineering announces: “Free Kisses”, followed by timetables and classroom numbers (elsewhere this might seem bizarre, not in Austin). Then IBM, Texas Instruments and other major computer companies arrived, and located their plants on what is still called Research Boulevard. Meanwhile in a university dormitory, a freshman named Michael Dell was assembling and selling computers. He never graduated, but today heads an empire worth $19 billion.

There was, in short, great excitement around the computer world, and it did not escape the attention of the federal government. “In those years,” continues Webber, “Washington had two priorities for national security in terms of technology. First, we were losing our edge in microchips. Second there was a crisis in the semiconductor industry, especially as a result of competition from Japan. So the government decided to create a national microtech consortium, called MCC, and established the headquarters here. Then they created a consortium for semiconductors, called Sematech, and guess where they based it? In the nineties, both crises were easily overcome, but, in the meanwhile, Austin had officially become a technology centre in the United States.” Soon it was discovered that – a rare event – the federal government, the state government of Texas and the city could collaborate effectively, without obstacles or competing against each other. “Just like at the concerts of Willie Nelson,” says Webber.

The energy sector is based more and more on mathematical models, data analysis and IT structures, which are the bread and butter of the people of Austin. We became an energy player, but smart

It was a particular combination of circumstances in the early 2000s that projected Austin into the energy world. On the one hand, the dot com bubble had led to a slump in the tech industry, while on the other, rising prices were strengthening the oil sector. Austin was the annex of Silicon Valley in the middle of the country’s most important oil state. “The energy sector is based more and more on mathematical models, data analysis and IT structures, which are the bread and butter of the people of Austin. We became an energy player, but smart,” says Webber. In Austin’s technologically fertile soil a battalion of energy-related start-ups started to emerge. Companies like Drilling Info, which is essentially a “database company”, that helps the oil and gas world make better and faster decisions,” as its mission states, thanks to software that makes it possible to maximise extraction and rationalize costs. Run Title, meanwhile, has put together the largest database in the United States on mineral properties, a tool that allows energy players to reduce the time and red tape on land sales. Mineral Soft calculates the revenues of each field and helps players to plan strategies, while for identifying the best services at the most competitive prices in your area there is Rig Up, a kind of Amazon for services connected to extraction. This city-incubator has witnessed the birth of dozens of young companies oriented to the optimization of the energy industry, an issue that is particularly relevant in a period of declining crude oil prices. Austin is an energy city, even if the surrounding countryside is not dotted with the iconic oil pumps.

“It’s an industry that is aging quickly,” says Chris Weyand, one of the two founders of Oil Patch Pro, an app that enables the clear and accessible mapping of oil fields and wells throughout Texas. Weyand is a biomedical engineer who is skilled in programming and data search. He is not the kind of guy who likes to waste time. When he got a job in an oil company he realised that he lost a lot of time explaining to the various teams – internal and external – that had to operate the wells the exact location of the field. Before you can work a well you need to know where it is. Endless phone calls, text messages and emails between offices and workers to explain exactly on which trail to turn right, where to look for the entrance to the property, which GPS directions not to follow, often in remote locations with a poor signal. A procedure which, repeated dozens of times a day, makes a difference.

“In general terms, what these daily inefficiencies showed,” he explained to me over a cup of coffee, “is the fact that there is not much of an appetite for technology in the sector. They do things pretty much as they have always done them, and here I’m talking about something as simple as the communication of information on how to get to places.”

Together with his partner, Chris Olfers raised $100,000 to create a mobile application that provides interactive mapping of the reservoirs, with highly detailed information.

“These data are public, but in the state database they are difficult to use and it is not easy to determine the level of detail that actually enables companies to optimise their operations.

Austin is a city strange in many ways...

“Keep Austin weird” is the motto of a city that is strange in many ways. Strange because it is a destination for creatives, a centrifuge of ideas, trends, music, style, a Brooklyn that is in less of a hurry with winters that are almost imperceptible; a place where every year the largest colony of bats in the world settles, a million and a half of specimens hanging under the Congress Avenue bridge. People come in their hundreds at sunset to witness the endless flock of bats up from Mexico as they go hunting for insects. For safety reasons, the city council has several times proposed increasing the power of the lights on the bridge, but the idea has been rejected by popular acclaim, for fear that the lights could disturb the bats. Elsewhere that might seem absurd. But not in Austin. It’s such a hipster city that walking through SoCo, the area of the moment, one wonders what happened to the normal districts, those where people shave  in the morning. None of the clichés about Texas, from cow horns to fringed chaps, applies in Austin. This is not the Texas of Bush and rodeos, it is the Texas of Lyndon Johnson and SXSW, the festival, of music, technology and visual arts that every March, since the mid-eighties, sets the agenda for the culture of innovation in the world.

For example, in 2006 a small start-up from San Francisco decided to present its product at SXSW, a social network to communicate in real time with short messages. When it arrived in Austin no one had heard of. At the end of the festival thousands of participants commented on the panel in real time with their friends. Three months later, Twitter was the next big thing. Roland Swenson, co-founder and deputy director of SXSW, tells me that “Austin was born as a city, it didn’t develop gradually, because when Texas was deciding on its capital Dallas and Houston could not agree, so, in the end, they thought that this area would be a good compromise.” A city born from nothing, where everything was focused on politics, but soon also the university. “No one was a native of Austin, it was a kind of free zone where everyone could be what they wanted to be, and there was also a great musical tradition, accompanied by an interest in technology. Put all these elements together and you get a city that has always had more restaurants, more clubs, more concert halls and brothels per capita than most cities in America,” says Swenson. Laughing, he swears that “the rest of Texas hates us, or at least traditionally that has been the case: but we are now less than we once were. But, in any case, they find us strange, bizarre.” The digital revolution “has accelerated and magnified the attractiveness of Austin and SXSW has contributed to this. In the beginning people used to come here because it was a neutral ground for the music industry, halfway between New York and Los Angeles. Now when we sell the passes, in the space of two days it is not so much the tickets, as the beds in the city that sell out.” There is a dispute among demographers on the actual growth of the local population, but the rumour is that every day 110 people move to Austin. Today the capital of Texas has almost one million inhabitants, fifteen years ago there was just over half that number. But its innovative and “weird” spirit remains intact.

about the author
Mattia Ferraresi
New York correspondent @IlFoglio_it