New start-up hubs challenging Silicon Valley - study
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Re: New start-up hubs challenging Silicon Valley - study
#2I'm proud to be a part of a small but growing one in Madison, Wisconsin.
At the end of the day, the nerdy dream I always had was to transcend physical location, so I'm always surprised how passionate others can be about where they physically live.
Re: New start-up hubs challenging Silicon Valley - study
#3Until recently I lived in San Antonio, TX and over the last year the startup community there has really begun taking off.
Rackspace is aggressively working to build a community there through efforts like Geekdom[1] and 3 Day Startup[2]. Two of the universities (TU and UTSA) are working with Geekdom to build entrepreneurship programs and companies are starting to come out of these efforts.
SA already has a tech community (Rackspace, Denim Group, the massive development groups at USAA, HEB and cyberdefense firms that are doing really cool but unseen stuff) and Geekdom has become the catalyst to draw them all together.
I was there this weekend for 3DS and I'm about to move back to work on some ideas with people I met over the last 72 hours.
Re: New start-up hubs challenging Silicon Valley - study
#4[deleted]
Re: New start-up hubs challenging Silicon Valley - study
#5[deleted]
Re: New start-up hubs challenging Silicon Valley - study
#6Ironically, the existing people/companies that are already there aside, Silicon Valley (and California in general) is a horrible place to found a tech startup. The cost of living is high and the taxes are high, with the former being an obstacle for bootstrapping a startup, and the latter being an obstacle when your company grows in size. The Democrats got a supermajority in the state House and Senate in the recent elections, so now they can unilaterally raise taxes, with the Republicans basically left powerless. No doubt many people will start to feel the squeeze in coming months as tax rates shoot up.
One of the big advantages of California is the year-round nice weather, but when you're sitting inside in front a computer, that doesn't really matter all that much. Moreover, a tech company, more so than many other types of businesses, can effectively work with people in remote locations.
Unfortunately, this is a problem that can't be solved easily over short time scales. The only hope is that people start realizing you can be "ramen profitable" a lot quicker if you choose to base your startup in, say, Kansas City (and there's always the nice added bonus of super-fast Google Fiber).
Re: New start-up hubs challenging Silicon Valley - study
#7Although this is probably won't be a popular viewpoint, Silicon Valley is likely reaching the end of its glory days. For the past 30 years or so, it has been able to exist as a largely insulated bubble -- mostly because it has been able to flex and grow as the rate of increasing demand started its exponential slope upward. But the reality of today is that demand for technical workers has outpaced SV's ability to grow. Because it is a peninsula, with limited space for growth and housing, the bubble is not infinite. Prosperity generally demands space, and there's just not enough of it here on this bleeding edge.
So, it's inevitable that other places will eventually benefit from the spillover. The questions are: where and how and when? Whatever cities can employ the most forward-thinking civil engineers and planners to literally build the city of tomorrow will be able to create an environment where cost of living coupled with a good cultural and environmental climate make it totally worth it to build a company elsewhere.
Re: New start-up hubs challenging Silicon Valley - study
#8I often wonder why more small companies don't locate in smaller "lifestyle" cities to facilitate recruiting. I suppose that places like Seattle, Boulder and Salt Lake fall into this category but as someone who just moved from Seattle to rural Montana near Missoula I am constantly surprised at the number of really talented individuals willing to take paycuts to live and work near the mountains.
Re: New start-up hubs challenging Silicon Valley - study
#9Although this is probably won't be a popular viewpoint, Silicon Valley is likely reaching the end of its glory days. For the past 30 years or so, it has been able to exist as a largely insulated bubble -- mostly because it has been able to flex and grow as the rate of increasing demand started its exponential slope upward. But the reality of today is that demand for technical workers has outpaced SV's ability to grow…
I agree about the limits, but the problem is not urbanistic, in fact afaik the French tried to make a techhub in the nineties by offering great offices for cheap and it didn't work.
What limits other hubs are taxes and legislation: a guy I know in Brasil had tons of stories about taxation over there, and it wasn't pretty. Another guy in Europe said in some countries its nearly impossible to fire an employee.
Then there's funding: in some places there really isn't any, and what little there is comes with a price, like 60% of your startup up front for $20K or less.
Those are the things that really add up, Silicon Valley is not just SF, there are places nearby which are much cheaper. On the other hand you can't escape taxation (unless you like being in jail) or labor laws. And if there are no investors you are screwed too, unless you have rich parents.
Re: New start-up hubs challenging Silicon Valley - study
#10Although this is probably won't be a popular viewpoint, Silicon Valley is likely reaching the end of its glory days. For the past 30 years or so, it has been able to exist as a largely insulated bubble -- mostly because it has been able to flex and grow as the rate of increasing demand started its exponential slope upward. But the reality of today is that demand for technical workers has outpaced SV's ability to grow…
The success of Silicon Valley isn't limited to the tech workers though, the entire infrastructure of the area is designed for startup success. All the financiers, lawyers, professors, etc. are 'lazy' in the sense that they prefer their companies and investments to be close to where they live.
There is ample supply of tech workers / infrastructure in NYC, Boston, LA, but the list of cities is a short one. There will absolutely be more companies formed outside of the SV area, but there is still plenty of room for growth here as well. There are a half dozen cheap communities in the East Bay which still have low housing costs, plenty of commercial vacancy, access to public transit and are actually a closer commute compared to driving to San Francisco (with Palo Alto as a center-point).
I have personal experience with two similar companies, one in 'Silicon Valley' proper and one in the East Bay. The company in SV had more employees by a factor of 2x, but was paying 15x more in rent for their commercial space! Both were backed by Sand Hill VCs and had professors from Stanford / Berkeley involved in the efforts. This could just be another data point in the "SV is too expensive camp", but it also points to the affordability of nearby areas which haven't seen the same level of expansion yet. Look up commercial / industrial real estate in Newark / Fremont / Hayward / Milpitas, you'll be shocked at how affordable it still is.
You don't need to build cities from the ground-up to have a climate hospitable for investment and venture success, it's much easier to be proximal to where such a place already exists.