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Why Silicon Valley Works

blog.samaltman.com

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Re: Why Silicon Valley Works

#31

Post by zoba »

Another reason I think the valley works so well is the audience its news outlets have. If you have a great product but can't get news coverage on it, its going to be hard to get growth without a large marketing budget. However, if you're friends with a friend of a Techcrunch write, its much easier to get covered and start to get a core group of users who love your product - and are tech savvy enough to understand that features that don't exist yet will be coming, and they should be patient.

If you try to bootstrap a startup without using SV's media outlets (as would be the case for people who don't have connections to these folks), you're going to have a much harder time.

Re: Why Silicon Valley Works

#32

Post by jiggy2011 »

clairity wrote: post #24
steven2012 wrote: post #17

No. The reason why Silicon Valley works is because of the intense greed that it provokes amongst everyone that comes here. Maybe "greed" is too strong of a word, because people aren't necessarily selfish, maybe "money-focused" is probably more accurate. And because anyone can come here and become a millionaire/billionaire, it draws in an immense number of hard-working people which just generally increase the level of…

sounds like it's not the place for you. a household making "only" $120k, no matter where you live, puts you in the top 15% by income in the US--hardly the "working poor" (see census data). trying to keep up with the joneses, on the other hand, can warp your sense of relative privilege. top 15% in the US is among the top few percent in the world. keep that in mind, and that'll help assuage the negative feelings that c…

If house prices are as bad as HN indicates I can understand how that income could put a person if not in the "working poor" then into the lower middle class.

Re: Why Silicon Valley Works

#33

Post by csallen »

anateus wrote: post #2

Two sentences early on are problematic: "One of the biggest misconceptions about us is that you need to have pre-existing connections to get value from the network. Remarkably, you don’t. " If Sam had said "you need them in Silicon Valley much less than anywhere else" it would be a true statement. But in an article I strongly agree with, this sort of thing... I'm not even sure what to call it, misinformation? Makes t…

I don't think he's saying that there is no network, or that the using the network isn't helpful. It seems like his primary point here is that your relationship to this network doesn't need to be pre-existing. If you know nobody in SV, but build something great, you will quickly get to know people.

Re: Why Silicon Valley Works

#34

Post by basher »

steven2012 wrote: post #17

No. The reason why Silicon Valley works is because of the intense greed that it provokes amongst everyone that comes here. Maybe "greed" is too strong of a word, because people aren't necessarily selfish, maybe "money-focused" is probably more accurate. And because anyone can come here and become a millionaire/billionaire, it draws in an immense number of hard-working people which just generally increase the level of…

To be fair to Altman - his article touches on costs: "(assuming, of course, that they can afford the wildly-out-of-control housing costs, which is probably the biggest weakness here right now)"

Interesting take though, you argue that the issues generally considered the biggest problems of SV, are the cause of its success.

Re: Why Silicon Valley Works

#36

Post by thebyrd »

"not too many people drive Ferraris or talk about their vacation homes" unless you're in Palo Alto, Atherton, Woodside, Saratoga, Los Gatos, Los Altos, etc.

That's probably why there's been a geographic shift to SF.

Re: Why Silicon Valley Works

#37

Post by hackuser »

steven2012 wrote: post #17

No. The reason why Silicon Valley works is because of the intense greed that it provokes amongst everyone that comes here. Maybe "greed" is too strong of a word, because people aren't necessarily selfish, maybe "money-focused" is probably more accurate. And because anyone can come here and become a millionaire/billionaire, it draws in an immense number of hard-working people which just generally increase the level of…

Just as a counterpoint, what about all the free/open source software (and hardware) that is integral to the foundation and current success of SV?

Re: Why Silicon Valley Works

#38

Post by x0x0 »

clairity wrote: post #24
steven2012 wrote: post #17

No. The reason why Silicon Valley works is because of the intense greed that it provokes amongst everyone that comes here. Maybe "greed" is too strong of a word, because people aren't necessarily selfish, maybe "money-focused" is probably more accurate. And because anyone can come here and become a millionaire/billionaire, it draws in an immense number of hard-working people which just generally increase the level of…

sounds like it's not the place for you. a household making "only" $120k, no matter where you live, puts you in the top 15% by income in the US--hardly the "working poor" (see census data). trying to keep up with the joneses, on the other hand, can warp your sense of relative privilege. top 15% in the US is among the top few percent in the world. keep that in mind, and that'll help assuage the negative feelings that c…

You don't understand what it costs to live here. Keeping up with the Joneses means envy for new and shiny, not wanting a modest house, cars, kids, and retirement savings. And here, that means an income of $250k is tough to do -- one bedrooms in sf are $3500; condos in the peninsula sell for $700k+ and houses cost $1100/ft^2.

$240k married filing jointly w/ 2 kids means $5900 hits your bank account twice a month. Essentially all of one of those paychecks will go to housing in sf, or a mortgage + taxes on the peninsula. That leaves $6k per month to live off -- which is certainly doable, but between childcare (at least after school w/ both parents working, possibly more), utilities, telecomm, cars, savings, groceries, and all the miscellaneous costs of life such as clothes, doctors visits, etc -- you aren't saving much money.

ps -- it's stupid to look at national statistics for income when this is the #1 most expensive housing market in the US. At least nyc has good transport options between Manhattan and Brooklyn / Queens. Here we have caltrain or the 580.

I mean, here's a home right here [1] -- 4 bedrooms for $315k! Of course, it's in Madison, WI -- but that shows housing prices are just fine in sfbay :rolleyes:

[1] http://madison.craigslist.org/reo/4668467650.html

@smtddr: we're not discussing what most people have; we're discussing what you can get in the bay area on $240k. Otoh, if you're now claiming that keeping up with the joneses == a middle class life, ie wanting a modest house, cars, kids, and retirement savings, then the plutocrats have won.

Re: Why Silicon Valley Works

#39

Post by AndrewKemendo »

Sam misses some hugely critical pieces, for example:

1. Good IT infrastructure

2. Plurality of high tech companies' headquarters

3. Proximity to major technology focused academic institutions

4. Legal infrastructure that enables innovation

All discussed previously here:

http://www.enterpriseirregulars.com/25271/silicon-valley%E2%...

and here:

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=124508

Re: Why Silicon Valley Works

#40

Post by scobar »

swamp40 wrote: post #7
anateus wrote: post #2

Two sentences early on are problematic: "One of the biggest misconceptions about us is that you need to have pre-existing connections to get value from the network. Remarkably, you don’t. " If Sam had said "you need them in Silicon Valley much less than anywhere else" it would be a true statement. But in an article I strongly agree with, this sort of thing... I'm not even sure what to call it, misinformation? Makes t…

I dunno - he explains his reasoning in the same paragraph: "It’s standard practice to ask people you’ve just met for help – and as long as you aren’t annoying about it, they usually don’t mind."

The problem, I imagine, this creates is thousands of requests for help from innocently ignorant founders to a single valuable connection in SV. Each founder may only make one naive request, but important individuals are bombarded by enough to exhaust them. I admire the patience of those who continue to offer thoughtful advice and feedback, but I imagine it's quite tiring. I think resources like Sama's free startup class at Standford are a great solution.
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