FreeMarkets Come, FreeMarkets Go?

There is hand-wringing around Pittsburgh today as we learn that one of our genuine e-commerce success stories has been plucked from our midst by a Silicon Valley company. Pittsburghers shouldn't cry in their Iron City (or Penn Pilsener) too quickly over this.

First, this isn't strictly a "California wins, Pittsburgh loses" deal. Whether or not Ariba (the acquiring company) keeps an office in Pittsburgh, FreeMarkets has been a big success for the high tech economy here, and the Silicon Valley is paying more and more attention to the efforts of Pittsburgh-area entrepreneurs. (Seagate is here. Intel is coming.) To a California venture capitalist, FreeMarkets may be one of a steady stream of local companies worth investing in.

Second, even if Ariba closes the Pittsburgh FreeMarkets office, many of the people who work there will stay in Pittsburgh (I hope) to start or work for other high tech companies.

Third, though it's a pipe dream to think that Pittsburgh's high tech economy can negotiate today as an equal against the Silicon Valley (or Boston, or Washington DC), there's no reason to assume that Pittsburgh can't play at that level in the future. Those areas are in the big leagues. Pittsburgh is, at best, playing AAA ball (one level below the top, for non-baseball fans). Pittsburgh should aspire to develop an economy in which some future equivalent of FreeMarkets can be the buyer of some Silicon Valley startup. With patience, hard work, and some creative thinking by local entrepreneurs, lawyers, and investors, Pittsburgh can make that transition.


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Pittsblog 2.0 is written by Mike Madison, a law professor at the University of Pittsburgh. Send email to michael.j.madison[at] Mike also blogs at, on law and technology. Chris Briem of Null Space drops by from time to time.

All opinions expressed at Pittsblog 2.0 are those of their respective authors and of no one (and no thing) else, least of all the University of Pittsburgh.

Pittsblog 2.0 has a motto: "It's steel good in Pittsburgh." Say it aloud, with a Pittsburgh accent.

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