Stephen D. Williams
sdw at lig.net
Sat Jun 1 12:17:38 PDT 2013
On 6/1/13 10:25 AM, J. Andrew Rogers wrote:
> On May 31, 2013, at 3:09 PM, Stephen Williams <sdw at lig.net> wrote:
>> On 5/31/13 12:05 PM, Aaron Burt wrote:
>>> It's beyond me how anything gets done there, with the chronic talent
>>> shortage (at least while VC money is flowing.) NYC is worse, though. No
>>> idea why it's so hard to lure techies there, but it's making my job harder.
>> Been there, done that... A good financial geek friend just escaped to California from NYC after a year of working on it.
> A prominent difference is that NYC startups tend to lack hardcore engineering cultures. NYC has such geeks, they just don't work at the startups there. I suspect this makes Silicon Valley startups more attractive to many techies, ceteris paribus.
>> Real substance and value over marketing and appearance and shallow lemming herds.
> I totally get that Silicon Valley is the latter but where is this mythical place that is about "real substance and value"?
Ha, good one. Most startups and companies are tech-shallow of course, so it's only about the presence of a measurable amount of
marginal cases anyway. In most areas, they are fleeting at best. Here, they are easy to find if often difficult to get into.
>> 13 years ago, I did several passes at fundraising in NYC, DC, Seattle, and the Bay Area. The NYC groups (30 or 40 of them) were all shallow finance types. On the West Coast, every single VC/angel was an engineer. Game over.
> The venture capital landscape has changed significantly since 2000. Your experience from then will not reflect the current experience.
> The engineer VC is a dying breed. Silicon Valley VCs have regressed to the mean and the VCs in other parts of the country have noticeably improved. Relatively few VCs require their investments to be local any more but the current generation is also far less interested in hardcore technology than they used to be (see: lack of engineer VCs).
Engineer VCs that you come in contact with in Seattle, or everywhere? I suspect there are thousands of multi-millionaire /
billionaire engineers within 20 miles of me who are or could/will be angels/VCs.
But, sure, the non-engineer types are going to be much better now than they were as the general public is far more educated and
savvy about technology and the value thereof.
> There are a few cities now in the US where VCs from everywhere will invest even though there may be a relative paucity of local VCs (e.g. Seattle). The challenge is not raising venture capital in those cities, it is that you have to get on a plane to raise it.
>> Maybe it's better now. No reason to investigate.
> It depends on what you are looking for. Silicon Valley does not offer the slate of compelling advantages that it did a decade or more ago. I could make the case that both NYC and Seattle are better alternatives to Silicon Valley in important ways, though for different reasons.
> NYC is quite good now for a certain type of startup and person. However, for hardcore tech geeks I would not recommend it. As a caveat, the VC community there is more insular and informally collusive than it probably should be.
That is exactly what happens in small markets also. The investors collude, partition, and otherwise screw the entrepreneurs until
the spring of talent dries up venture wise. Only egalitarian investors who strike fair deals and nurture companies to everyone's
advantage are going to create a lasting, trusted environment. I've already put in my time in off-markets trying to make that work.
> Seattle (and the Pacific Northwest broadly) has become the top alternative to Silicon Valley for hardcore engineering geeks. The engineering talent density and quality rivals Silicon Valley, hence why most top Silicon Valley companies have large campuses in Seattle. Average engineer take-home pay is actually higher than Silicon Valley. Quality of life is off the charts for a US city, much better than Santa Clara county. However, there is a paucity of local venture capital and so the region imports a ton of it.
We have a developer in Seattle. Who in Seattle isn't working or hasn't worked or isn't planning to work for Microsoft or Amazon or
I'm curious how many startups are there, investments, and the profile of successes. Glad there is a good alternative. I'd rather
have 5+ solid alternative areas competing solidly. Seems patchy at best, but I haven't been analyzing, having finally and
comfortably insinuated myself into the center of Silicon Valley.
And the sky is blue here. In several senses, nearly all the time. They don't call it Sunnyvale for nothing. I can comfortably run
or bike here about 98% of the time. Kayak maybe 70% of the time, if I got around to it. DC was a nice almost-secondary market in a
lot of ways (first in government, 1.5 in biotech, etc.), but it was, overall, far more annoying and uncomfortable than Silicon
Valley. Traffic, business, investment, cost, weather (which impacts fitness), etc. The constrained highway system alone limits the
whole area. Take a look at Mountain View highway interconnection, secondary roads, and neighborhood connections, plus trains and
the nearby airport. I happened to initially live at the intersection of Whisman and Central. Although the paths were complex, that
point connects to everything in every direction with only a few blocks of city driving. From this area, I'm within reasonable
commute of tens of thousands of interesting businesses and startups. There's nothing like that in DC really.
In NYC, there is sort of even better density, but I suspect the range of business accommodations is far less variable which probably
leads to a fairly high bar to initiation. Here, there are a variety of ways to start meeting for a business for free or
$100/person/month or not much more. Any plenty of people will drop by and offer to join, and many of them can bring along real
expertise and experience at the biggest and best companies.
It's been written in the past that this cross-pollination is what really makes Silicon Valley work. By tradition, and California
law for some time, large-scale cross-pollination is explicitly legal here while it is murky or partially constrained elsewhere. In
particular, Boston in the DEC days, and apparently mostly continuing now, never broke free of this. Apparently some court cases
with Digital et al went the wrong way and chilled the market. It's a good market, not great.
> Silicon Valley still has a number of things going for it but many of its traditional advantages have waned over time. For some tech startup people living in Silicon Valley, moving to places like NYC or Seattle would be a legitimate improvement, particularly given the rapidly growing prominence of their ecosystems.
I wouldn't knock it; glad if it is growing. But I wouldn't make that choice without serious I-can-go-anywhere-do-anything-indefinitely levels of cash. In that case, I'd perhaps enjoy being a local benefactor. But, upon reflection, the lack of hardcore competition on the doorstep probably would doom anything significant, failing to fail fast or whatever.
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