The Washington PostDemocracy Dies in Darkness

Why Zappos’ CEO couldn’t save downtown Las Vegas

Flickr photo courtesy of <a href="">wbeem</a> using a Creative Commons license.

Zappos founder Tony Hsieh's "Downtown Project" in Las Vegas has been one of the most intriguing urban development stories in the U.S. for the last two years, an experiment in city revival run by an idiosyncratic Internet entrepreneur.

Where most downtown development projects are small-scale — a new museum here, a repaved pedestrian mall there — his was ambitious, striving to remake a massive chunk of the city's core that most tourists to the Strip never see. Where public money for renewing neighborhoods is often scarce, Hsieh promised to plow $350 million of his own wealth into Las Vegas, buying property and backing businesses. Where traditional developers talk bottom lines and occupancy rates, Hsieh preached out-there ideas about "return on community" and "collisions" between the people and ideas that exist there.

Hsieh wanted to do seemingly everything in this part of the city that had been overlooked by tourists and abandoned by locals alike: create a tech hub, lure startups to town, launch new restaurants, schools and residences. And his experiment did bring in all kinds of people, from entrepreneurs vying for his financial support, to media bemused by the oddity of all of this in ... Las Vegas. If you haven' been following the strange tale, you can read about it in The New York Times Magazine, in this series from Alyssa Walker at Gizmodo, or this one from Nellie Bowles at Re/Code.

Now, this week, it appears as if an endeavor on which many people had pinned their hopes is faltering, with a sudden slew of layoffs, the public departure of the project's "director of imagination," rumors of new businesses bleeding money, and the news that Hsieh himself has receded from his role leading the project (he disputes the idea that he stepped down from a position that he technically never held).

The news is disillusioning for people personally invested in Hsieh's vision, as well as for anyone who was simply excited by the enthusiasm — and the resources — of a tech entrepreneur embracing a blighted city. Hsieh had set his sights on a part of Las Vegas pockmarked with decaying buildings and empty lots, with few thriving businesses and even fewer pedestrians. Downtown Las Vegas — not the Vegas Strip — is the place that better represents the city's high unemployment and faltering economy post-housing boom.

More often, the tech world is associated with suburban seclusion, gated-community-like office parks, and bad urbanism. Then here came a guy who seemed to talk about the culture at his Internet company like an urban planner. He moved his company into Las Vegas' old City Hall. With all of his money, Hsieh could have had a lot of toys, Bowles wrote. But, "he chose a city."

That the task has proven messier than he seemed to anticipate — or his supporters hoped — points to a couple of lessons: Cities, as Walker notes this week, are not like startups, running on eagerness as much as expertise, easily A/B tested and rebooted on the fly. Nor are they all that much like their virtual versions in Sim City, a game that's given a lot of people the seductive idea that building a metropolis is as easy as point-and-click. Cities also don't fail in the same way that startups do, and when they do, the costs are much higher. As for when they succeed — that inevitably takes more time than a new digital venture.