We talk endlessly about an American response to Shenzhen. Every proposed response is roughly the same. It’s a city. It can usually be shortened to 2-3 letters and colloquially referred to as such. And it usually rhymes with SF, LA or ATX.

All that talk is a waste of time.

Our framing of Shenzhen as a freestanding industrial powerhouse is fundamentally flawed – so flawed that we take to loud opinions on social media and easy to digest single-city solutions, all while we ignore that our national response already exists in a completely different, more complex form. It’s not a city. Nor is it actually a response to Shenzhen. It’s actually a response to its regional home, the Pearl River Delta. Why? Because Shenzhen is nothing but a city of people and factories. But together, with a tightly clustered collection of its lesser known and just as densely populated neighbors, it forms a super region of immense industrial capacity.

We have this in America too. It’s called the Rust Belt.

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Pearl River Megalopolis

Everybody knows Shenzhen. And you’ve definitely heard of Guangzhou and Hong Kong. But who knows Foshan, Dongguan, Huizhou, Zhuhai, Zhongshan, Macau, Jiangmen or Zhaoqing? Bascially nobody.

Together they form the Pearl River Delta – one of China’s wealthiest and most industrially desnse regions. Spanning 21,500 sq miles, 85M+ people and 300,000+ metal shops, mould houses, stamp shops, PCB fabs and EMS assemblers, it’s a megalopolis with an industrially-powered GDP of $2T+ USD. Inside sits ~80% of China’s emerging hardtech unicorns. [1/2]

By coupling the inputs (raw material, tooling, skilled labor, assembly) and the outputs (hardtech startups) within such a compacted geography, China’s taken a page out of the American industrial superpower playbook written at the height of its Arsenal of Democracy days. Days when America thought in the collective. Days when iron ore from Minnesota, Wisconsin and the Upper Peninsula shipped through the Soo Locks met coal from the Appalachians on the mill-filled shores of the Great Lakes in Cleveland, Buffalo and Erie, was cast, rolled, forged and machined before being taken by rail to Detroit's mass factories and manufactured into a B-24 bomber every hour.

In a similar system, today's Pearl River Delta hardtech startups need not travel more than a few hours to see, touch and adjust its most critical inputs and need not wait more than a few days to see it shipped to its HQ.

Competitively, regional compaction is a compounding edge with dramatic upside when scaled. For every component ordered by an American hardtech, a comparative Chinese hardtech pays 10x less and receives it 3.5x faster. [3] Scale this up an order of wartime magnitude, cut off access for American hardtechs and things quickly start looking pretty bleak for Western democracy.

Two and Three-Letter Cities

If China thinks in megalopolises, why do we think in cities? Maybe it’s the pride we carry for our homes. Maybe it’s an ego that comes as a byproduct of that pride. Maybe it’s the groupthink bubble we develop as an agglomerate of that shared ego.

Having been raised far from the reaches of SF, LA or Austin in a city brought to its knees multiple times over the last five decades and societally reduced to rust with little to no ego left, I think it's something more dangerous in wartime: naivety.

I think we’ve collectively become hypnotized by the returns that one particular city (San Francisco) has showed us is possible in the era of software. So much so that we unquestionably assume the same must hold true in our new era of reindustrialization. [4] But this is flawed.

Whereas software can scale the globe from a cubicle in Menlo Park, hardware is constrained to its nearest bottleneck within a broader, disparate landscape of a million other potential bottlenecks. Solving the current bottleneck only reveals the next. Status quo is production hell. In a hardware world, a city is just a city – no one better than the next at breaking through.

No country understands this better than China and no region personifies it more than the Pearl River Delta. Whereas us Americans obsess over a single city and dedicate ego, talent and money to it almost exclusively, China obsesses over the collective capabilities of an entire interconnected region that crushes anyone who dares try to compete with it.


Crossing the Chasms

Hardware is a unique category of startups. Comparatively, software looks easy. Minimal startup costs, increasingly lower barriers to build and a single chasm to cross (best called “product market fit”) means that software is largely fought in the arena of marketing and indefinite product iteration.

Hardware is near polar opposite. Lofty startup costs, highly technical builds and a high probability of testing casualty (breakage, fires, explosions, etc.) leaves little room for early failure. And the reward for making across the very first prototyping chasm? More prototyping, more testing, more scaled production and increasingly more complex logistics. One chasm begets another.

Behind every hardware startup lies a complex web of chasms that few regions (never mind a single city) have the means, talent or capacity to help a hardtech startup cross. Contrary to West Coast dogma, venture capital is not a chasm. In hardtech, it’s infrastructure – technical talent, raw materials, factory space, power, machine shops, suppliers, test facilities, commercial partners, logistics. A plethora of boring business systems absolutely vital to the existence and success of any hardware-anchored startup.

As critical as hardware is in this moment for the national interest, one of the biggest criticisms is that we’ve become blind to these realities by the superficial sexiness of hardtech. See Erik Bruckner.

Whether it’s because we’re now three generations removed from the last great industrial age or we’re naively hypnotized by the capital-infused bubble on the West Coast, we’ve forgotten (or ignored) that a sexy-sounding hardtech idea is just that. It’s the beginning of a treacherous road, one much longer, more complicated and more unforgiving than the majority of the West Coast realizes.


The Rust Belt

Seeing the West Coast's foray into industrial-scale hardtech is unexplainably frustrating. Calls to build out more industrial infrastructure, to somehow cheapen energy costs, to turn Alameda Point into a manufacturing super site and to fix bottlenecked supply chains are all frustrating. [5]

While China leans on its collective edge, continually widening its gap against us in critical industries with every passing day, we’re wiping the national slate of tribal knowledge and attempting to recreate the wheel. We’re laboriously forcing optimal conditions that already exist elsewhere to solve constraints that have been known, mitigated and solved for centuries elsewhere. And all for what? To be closer to venture capitalists?

Elsewhere is a place called the Rust Belt.

Depending on who you ask, the Rust Belt is a super region of seven industrial powerhouses – Michigan, Ohio, Illinois, Indiana, Wisconsin, Pennsylvania and New York – and our closest provincial ally, Ontario. More definitively, it’s a 300 mile radial circle, centered around Detroit, that saved western democracy. Twice.

Inside sits one of the world’s densest concentrations of technical hardware talent, industrial supply chain, scaled manufacturing capacity and portals to allied nations and international waters alike. World renowned engineering programs here spill out all the top talent that your favorite hardtech startups fight over. Metal shops supply those same startups from 2,300 miles away. Our lakes are glacially-carved oceans home to a vast network of international freight routes and military testing sites. Our grounds are home to some of the country’s most critical mass minerals – iron, copper, nickel and cobalt. Behind all of it, there’s a viscosity of industrial heritage that runs through the bloodlines here, passed down generation after generation, that forms an unbreakable bond between the people and industrial complex.

This is a world unlike SF, LA or Austin. It’s one born of raw minerals, molten-heated foundries, blue collars and a steely grit that you can only get with an industrial heritage that stretches back 200+ years. Unironically, it’s all very Shenzhen-esque. Yet, for some reason, we don’t talk about it as such.

We don’t talk about how 40%+ of the country’s top hardtech teams started here. [6] We don’t talk about how it already accounts for 32% of the country’s machine shops and 30% of its active manufacturing capacity. [7/8] All with another 175 million sq ft of abandoned, smaller-footprint manufacturing capacity lying dormant, waiting to house the early-stage startups of the next industrial revolution – all offered for lease at pennies compared to the West Coast. [9] And all within those same compacted 300 miles.

No, it doesn’t take the simple form of a one-city solution. No, it isn’t on the West Coast (or an adjacency of it). And no, it isn’t warm in the winters. But damn is it a megalopolis. One staring at us right in the face.


A Super Region Response

Competing with China is hard. Entry price to play the game requires simultaneously competing across talent, cost, infrastructure and sheer scale. You don’t win with a single-city solution. You win with a Pearl River megalopolis. You win with an American super region.

To steal one of San Francisco’s favorite tropes, the opportunity here is 100x larger than we can comprehend. Imagine an America where the most elite hardtech talent and the infrastructure to execute on it meet, centralized across just 600 miles end-to-end. We’d be unstoppable.

All of this isn’t just a call to give the Rust Belt more mindshare as we mull over the best way to beat China. It’s a mandate to shift every available resource to it, now. All in a quest to build the allied world’s most critical hardtech at 100x the scale, 100x faster.


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[1] HKTDC.

[2] Yicai.

[3] Due to cost and shipping disadvantages, the gap widens even more for American hardtechs purchasing domestically-made components. Domestic components with expedited shipping can cost upwards of 50x more than the comparative Chinese component.

[4] A side note. I find it curious that the loudest city versus city debates happen everywhere but where the last industrial revolution actually happened. If you ask anybody in the American Midwest who built the industrial bones of the country and later led the allied world through WWI and WWII, you’d hear of the Rust Belt. You’d hear about a collective of Detroit, Chicago, Milwaukee, Buffalo, Erie, Pittsburg and numerous others working in close coordination with one another. But never any one in isolation. So what makes today any different?

[5] Equally frustrating is the Rust Belt’s inaction while all this takes place on the West Coast. While I call the West Coast's efforts frustrating, there’s something untouchably magic about the ability for SF, LA and Austin to try, fail and improve. We wouldn’t be building rockets to Mars, autonomous fighter jets, modern nuclear reactors or new-age shipyards right now without it. For that, thank you. There’s an equally critical essay coming for the Rust Belt inaction too, don’t worry.

[6] At least one member of the founding team, per a16z’s 2025 American Dynamism 50.

[7] Uptool.

[8] United States Census Bureau, Census County Business Patterns 2022.

[9] Approximation based on current leasable and vacant manufacturing space data from JLL, CBRE and Cushman & Wakefield. Data filtered only for manufacturing space with > 24 ft clear height.