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Everything’s Great When You’re Downtown
The short afterlife of Tony Hsieh’s Las Vegas
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Fremont Street began with the railroad. In May of 1905, William A. Clark, a U.S. senator and Montana mining baron, held an auction for land he owned along a route connecting Salt Lake City and Los Angeles, with what would eventually become Las Vegas serving as a midpoint stop. The two hotels built on the land that was auctioned, the Nevada and the Overland, sat in what was then a business district, with gaming sequestered one block over until 1910, when gambling was banned outright in the state.

Over the years, the city grew slightly, but the first vestiges of modern Las Vegas didn’t come into view for a few more decades. In 1931, gambling was relegalized in Nevada, and construction began on the Hoover Dam. Alcohol, prostitution, and gambling were prohibited in Boulder City, which was far closer to the Dam than Fremont. Thus began Vegas’s career as a playground, brightening with each new neon-fronted club and casino. Relegated at first to the short length of Fremont, outposting properties then spread along Las Vegas Boulevard, metastasizing into the area that would become the Strip.

Vegas lives and dies by its associations, which never really disappear but rather fade under the desert sun until they turn into useful diversions. For the longest time, the mob and its involvement in early casinos made for titillating storytelling. Now, this once hidden past is officially sanctioned; there’s even a museum devoted to it. Sentimentality is anathema in a city once deemed the “Implosion Capital of the World.” You can’t stay attached to a particular hotel or gargantuan complex for too long: they blow up even mainstays here at the drop of a dollar, which has led some to claim that Vegas has been intentionally developed as an ahistorical city, or just one that savvily caters to our desire for short-term luxury.

I grew up in the western suburbs of the city, on the edges of a master-planned community called Summerlin that grew out of large swaths of land purchased by a long-dead Howard Hughes. So I know that locals like to debate Vegas’s history, combining nostalgia, dismissal, and ownership, and everyone stakes a claim to this corner of the Southwest where the glossy veneer is as significant as it is irrelevant to the people who live here. But to claim that Vegas is more than Sin City is a cliché in and of itself, especially as the city grows in size. First, it was a railroad stop transformed by gangsters, media tycoons, corporations, and celebrity architects into a destination. With the ascendance of Silicon Valley, Vegas became—to use the parlance of urban renewal—an opportunity.

The Dunes

Some say Tony Hsieh chose southern Nevada for the low taxes. Hsieh maintained it was the place where those who wanted to make customer service their career— his current and future employees—would be happiest. After initially investing in and advising the online shoe company Zappos, Hsieh became CEO in 2000 and moved the company’s headquarters from the Bay Area to Henderson, a suburb outside of Las Vegas, in 2004. Coming after the success of LinkExchange, an internet advertising firm that he started with Sanjay Madan after graduating from Harvard, and the founding of Venture Frogs, an investment firm, his relocation to the desert took on the shape of a hero’s journey—especially after the launch of the Downtown Project (DTP), a revitalization venture intended to clean up the corridor of abandoned motels and empty lots adjacent to Fremont Street. Here was a company turned wildly successful, an odd but perceptive leader seeking a work philosophy that was both profitable and fun, and an unlikely setting for a new generation of startups.

The Downtown Project was Tony Hsieh’s idea of an entrepreneurial jungle gym.

Founded in 2012, the Downtown Project was Tony Hsieh’s idea of an entrepreneurial jungle gym, a place that would, with $350 million in personal funding from Hsieh, make Las Vegas “the most community-focused large city in the world.” By 2015, Hsieh had brought in sixty startups (the stories and testimonies of down-on-their-luck individuals scooped up by Hsieh dot much of DTP’s early press coverage, as well as the obituaries after his death) and bought acres and acres of land. “We wanted to help create a place where you had everything you need to live, work, play within walking distance,” Hsieh told NPR that year, referring to Zappos employees, but also anyone else ready to contribute to whatever a “community-focused large city” is.

In their recent book Happy At Any Cost: The Revolutionary Vision and Fatal Quest of Zappos CEO Tony Hsieh, the Wall Street Journal reporters Kirsten Grind and Katherine Sayre argue that Tony—never “Hsieh,” one of several quirks that seem to infantilize the subject—was a brilliant entrepreneur, with a knack for pushing through innovative projects, who also struggled with severe, undisclosed, and ultimately tragic mental health issues. Their thesis echoes a sentiment that traveled throughout the local community when Hsieh’s death from injuries sustained in a house fire in Connecticut was announced late in 2020. But people who didn’t work for Zappos or DTP, and even, as Grind and Sayre suggest, those close to Hsieh, didn’t actually know him very well. It is a fitting irony, then, that after spending fifteen years here, Hsieh didn’t know Las Vegas very well, either.

Downtown’s reputation as a dangerous and squalid corner of Las Vegas seemed to be cemented right as it was announced that Zappos would be taking over the old City Hall campus, located minutes away from the heart of Fremont Street and just off the 95 freeway. People had lived and worked in that area long before Hsieh arrived, but the tech company’s move there would not have been as marketable without the idea that Zappos and its fleet of transplant employees were putting down roots in a place that needed fixing. In fairness, some residents who have lived in the area longer than I’ve been alive have differing opinions about downtown. Beat reporters for the Las Vegas Review-Journal and local NPR station took up the story of a crumbling area without much pushback. So perhaps it’s more accurate to say that Hsieh saw room for reinvention in a town that had been reinventing itself for decades.

Hsieh’s vision for DTP was first evident internally at Zappos, where the list of company values that he came up with—Deliver WOW through service; embrace and drive change; create fun and a little weirdness; be adventurous, creative, and open-minded; etc.—sounded more like grade-school classroom rules than feasible business practices. The Downtown Project took off in earnest once the Zappos ethos, and Hsieh’s reputation as the oddball CEO behind the bestselling book Delivering Happiness, began to overshadow the received wisdom that Vegas was an unserious town stuck in the past.

In 2014, Hsieh described downtown Las Vegas to Recode as “TED meets SXSW meets Burning Man, but as a lifestyle, rather than events.” He added: “And we can scale this to multiple cities—you can see this as the MVP (minimum viable product).” For years, the juxtaposition of Silicon Valley startup culture with a failing city full of retirees and drunk tourists was the prevailing media angle on the DTP. “A real-life Sim City,” the New York Times called it. An “ambitious project” in “the blighted part of the city” one NPR article read. But as Hsieh attracted more and more startups to the area, run by the experienced and amateur alike, the hacking of downtown’s potential gave rise to a picture of cleanliness and community. As Saritha Ramakrishna, writing in Literary Hub about growing up in another Southwestern city transformed by tech capital, has put it: “In a conservative narrative ‘growth pays for itself’ via new single-family homes and suburban affluence. In liberal campaigns for a new urbanist future, high-rise downtown condominiums, art spaces, and breweries populate a newly developed urban core.” Flubs on the way to building this urban oasis—like Hsieh’s purchase of the Towne Terrace housing complex and his subsequent eviction of residents whom he didn’t know (or didn’t bother to check) were living in the supposedly vacant building—don’t loom as large in the approving stories that get told about the project.

Aladdin

Grind and Sayre purport to offer a complex portrait of Hsieh. But all they reveal is that, however genuinely motivated by altruism and enthusiasm, he was also deeply unhappy in his personal life. Much time is spent on his alcoholism and drug use, particularly of hallucinogens and nitrous oxide, and his difficulty maintaining close relationships: classic markers of dysfunction that would be interesting in a broader, less exalted narrative about a genius’s untimely demise. Few readers learning about Hsieh’s stint at an expensive rehab center or his lavish spending—which included the reshaping of a prominent metropolitan area—will find him relatable.

The testimony from close friends and former business partners featured in Happy At Any Cost seems to confirm Hsieh’s media reputation as a charismatic disruptor. The authors’ criticism extends only as far as speculation about his emotional and mental state. Less room is provided for dissent or even good faith skepticism about his managerial style or his philanthropy. Instead, there is much record-correcting, with Hsieh’s allies intent on dispelling rumors of a cult-like workplace, his eccentricity, and his financial whimsy. Struck by Grind and Sayre’s relentless emphasis on Hsieh’s accomplishments, I brought it up with a friend who briefly worked at DTP and has lived downtown since well before Zappos’s arrival. She pushed against the idea that Hsieh alone was responsible for the area’s strange transformation. “There were a lot of other people involved in his circle who were in charge of actually implementing his ideas,” she told me.

Happy At Any Cost admits as much, with a flattering spin: the authors contend that Hsieh was the sole catalyst for change in DTP, while the project’s problems and mishaps were secondary to his beneficial effect—which isn’t explored much beyond revenue and engagement statistics—on the city. In their attempt to paint an instructive portrait of a single figure, Grind and Sayre miss what others had been noting from the beginning of Hsieh’s time in Vegas: what he built amounts to a shopping mall.

Pioneer Club

In a recent talk with the Downtown Seattle Association, Richard Florida—whose speeches on the state of American cities sound like versions of a stand-up routine he’s still workshopping—quoted Jane Jacobs on the importance of downtown spaces: “Downtown is for people.” Known for coining the phrase “creative class,” Florida will be remembered this way long after he’s gone, but his most recent talking point, shared on platforms from podcasts to CNN, is the fate of cities in the aftermath of Covid-19. The way he tells it, while the pandemic was bad (past tense, because it’s certainly over), what it revealed about the way people live and work has been decidedly good.

Florida contends that the strictures of place-based work—at least for the middle-class demographic he’s interested in—have disappeared, and empty office buildings will become cultural centers for convening and socializing. Because what enterprising, educated young people really desire is a city with opportunities that conform to a three-word philosophy: Live, Work, Play. Florida wants to add a fourth word, “Connect.” Now is the time for the new.

Contrast this speech to another from 2017, at the Urban Land Institute, when Florida railed against the consolidation of wealth and widening inequality harming the same major cities he now praises—a “new urban crisis” that had left even the largest, most productive and affluent cities economically and socially divided. Revitalized downtowns have since usurped his priorities. He admits that inequality will always be abhorrent, but the issue is even more out in the open than before—which is a good thing because it can now be addressed.

Like urbanist thinkfluencers, tech entrepreneurs often say ridiculous things. The difference is that their words—which imitate hard-won wisdom or heaven-sent epiphany, repurposing familiar lingo into novel nonsense—are rarely challenged. In a talk at the Aspen Institute in 2013, Hsieh likened moving to downtown Las Vegas and starting a business there to “subscribing”—or, buying into an idea. From the beginning, Hsieh endeavored to quantify the monetary value of the people who might participate in the Downtown Project. No matter what those numbers said, the point was that there were numbers to show. Other figures, like those of the unhoused people being pushed out to make way for new buildings, families living in weekly rental homes down the street, or residents selling plasma at the neighborhood’s clinic for preloaded Visa cards, were not part of the equation. Even larger and longer-term issues—like the dwindling water supply—were problems for another day.

Few readers learning about Hsieh’s stint at an expensive rehab center or his lavish spending—which included the reshaping of a prominent metropolitan area—will find him relatable.

Leah Meisterlin, an assistant professor at the Graduate School of Architecture, Planning, and Preservation at Columbia University, visited an unfinished downtown Las Vegas in 2013. By that time, the most prominent planned attraction was the Container Park on Fremont Street—an outdoor shopping plaza constructed from repainted shipping containers (and purpose-built “Xtreme Cubes”) where many businesses have since come and gone. Further down the street was the location of the yet-to-be-built Hydrant Club—a dog training facility with a giant yellow fire hydrant that would spout water when you pulled an oversized lever. And past that was the eventual location of the trailer park/tiny-home enclave where Hsieh spent much of his time hosting entrepreneurs and visitors. In between each of these sites were large swaths of dirt where future buildings would rise; extant structures covered with spray-painted murals, empty parking lots, liquor stores, and a dearth of shade.

Dismayed but clear-minded, Meisterlin connected the Downtown Project to a larger issue plaguing revitalized cities. “This breed of urbanism,” she wrote in The Avery Review, “is an antipublic version of social space requiring only the semblance of city-ness for its sustaining. The image of the Downtown Project, as it is and as it seems, is the logical end of privatized planning ad absurdum drawn as a diagram of hubris over a fading erasure of civic responsibility.” Few were willing to note that the Downtown Project was selling consumerism with a hand-painted shell over it. But Hsieh pushed back against the idea of civic responsibility, even when he felt his intentions were distorted by the media. “I don’t know if it needs to be framed as, ‘Oh, you’re either in business to maximize profits or you’re this philanthropic, altruistic person,” he told NPR in 2015. “I think there can be an in-between where you try to do well by doing good, and it’s a win-win-win for everyone.”

At the talk in Aspen in 2013, an audience member asked Hsieh if he’d considered old people in his plans for DTP. “This is such a young concept. What are your thoughts on the existing community you find in Vegas, which is not that young?” Hsieh demurred. He said the Project was open to, and hoping for, diversity of all kinds, which didn’t answer the question. Meisterlin was more forthright in her piece. “It is not open and has no need for the messiness of democratic decision-making,” she wrote. “It has replaced the public with massified social self-similarity, hindered effective diversity on a crusade for a singular like-minded community, and substituted experiential richness for ‘happiness’ without conflict.”

Hsieh’s concept for the Downtown Project was particularly influenced by Edward Glaeser’s book Triumph of the City: How Our Greatest Invention Makes Us Richer, Smarter, Greener, Healthier, and Happier, in which the author proclaims that “human collaboration is the central truth behind civilization’s success and the primary reason why cities exist.” The town square lives on as an essential feature in his view of cities, and its health is measured in the number of restaurants and bars built. This kind of magical thinking is what has made gurus like Richard Florida so popular among VCs, politicians, and entrepreneurs. The abstraction of phrases like “Downtown is for people” is key to their power. They are optimistic vagaries upon which one can hang any number of ideas about the way that spaces should be organized, optimized, and monetized, all the while retaining a veneer of altruism. Meanwhile, social services, federal resources, and the already-present population working and living in these spaces do not fit. But they don’t need to, as displacement is a natural feature of the renewal process, and what matters is how existing physical structures can be repurposed to cater to a class of outsiders attracted to a blank slate.

Vegas World

What’s most frustrating about idea-driven, egomaniacal altruists like Hsieh is that they propose ideas which, at face value, seem impossible to argue with. Why wouldn’t you want to have people trade in their cars for a clean and affordable public transit option? Who wouldn’t want to see a downtrodden city get back on its feet? And, at a quick glance, the Downtown Project’s metrics suggest irrefutable evidence of growth: 1,500 jobs created, over $200 million in revenue. But that success is concentrated in small areas of downtown, in enclaves that are often surrounded by gates. Outside of them sit vacant lots exposed to the sun. Unhoused people, who are little more than a nuisance to DTP, wander the area in search of water and shade, hounded by police in increasingly dense residential pockets that were once piles of dirt. The clamor of industry is impossible to ignore; there is always some corner of downtown under construction, heralding the arrival of another apartment complex or “hub.” Meanwhile, the newfound safety that’s arrived to the city is at the behest of private security firms, which patrol the streets in tandem with local law enforcement.

What enterprising, educated young people really desire is a city with opportunities that conform to a three-word philosophy: Live, Work, Play.

During the summer of 2020, Vegas, like many other cities, was the site of protests against police brutality. Some friends and I were in the crowd for a few of them, experiencing the slight delirium brought on by high temperatures, direct sunlight, and the nonchalance of visiting tourists. One of these protests took place downtown, meeting at the Container Park at sundown. By then, Hsieh had left Vegas for Park City with his sights set on a new community-focused venture called 10X. In his wake, novelty persisted through gimmicks like an installation on Fremont Street of a praying mantis that shoots fire from its antennae. But many of the startups he had brought to the city had failed. Three entrepreneurs had even died by suicide, tragedies that coincided with sudden layoffs at DTP. In the moment, all of that felt like a distant memory, eclipsed by long-standing crises in the city that had never been touched by Hsieh’s project.

The crowd marched down narrow streets, our route often confused by overeager individuals at the front who didn’t know where to turn next. We passed the jail, where the silhouettes of inmates behind windows rose up several stories before us. Then we turned toward the Strip, which was still far in the distance, past the Stratosphere and the headlights of cars. The irony that a Silicon Valley entrepreneur thought he could oppose the gargantuan corporate investment that is the Strip with a smaller, supposedly more honest and sustainable social center only really dawned on me then.

For decades, the resorts and casinos lining Vegas’s central boulevard have perfected their pitch to the world, creating a tourist attraction like no other, using cutting-edge surveillance technology, water-saving techniques, and cyclical facelifts of major buildings to keep people in one concentrated urban area for long periods of time. Most new residents and business reporters have fallen for a greenwashing campaign that touts the sustainability of Las Vegas’s newer casinos while omitting their even more gargantuan size and density. Never mind that the Strip’s climate-conscious innovations are nothing more than a stopgap against the scorching temperature, drought, and pollution that lie ahead.

It occurred to me that Hsieh and DTP could have learned a great deal from the blatant capitalist impulses of the Strip. In recent years, the casinos have been heralded by the media, designers, and politicians as eco-friendly success stories, models of urban design. They’ve won accolades by selling themselves as nothing more or less than what they are: experiential traps for commerce. Whether that same shrewdness would have improved DTP, or Hsieh’s outlook on it, will remain an unanswered question. What is clear is that the solidarity I felt during the protests of summer 2020, directed against government institutions and conservative forces of all kinds, was dwarfed in the months that followed by the economic churn of expansion and renewal. Vegas got going, bigger and louder and denser than ever before, with all signs pointing to a redux of the housing bubble that burst in 2008. Which is how I know that Hsieh’s endeavors, however bright-eyed or forward-thinking they may have been perceived to be, were always destined to fail. He thought he could transform a city that’s perpetually in flux but utterly disinterested in genuine change. Ultimately, the Downtown Project was just another startup trying, as so many do, to reinvent the wheel.