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There's also the fact that California is regularly at the bottom of rankings of "business friendly" states. I'd rather locate my business in a state that wants me there.
Counterfactuals are very hard to know. At CircleCI, being in SF gave numerous advantages early on. We had multiple paying customers in the first two office buildings. We had multiple customers within walking distance, and many more within cycling distance. Being able to talk to real customers using the app was extremely valuable. Customers aside, there are tons of people willing to help, either through advice or intr…
"Not every developer in SF is as mercenary as you make it sound. For your first employee hire, you might find a single person living in an apartment in SF vs. a family man in St. Louis who has to pay for day care and save for college. Their salary requirements might be comparable." This is based on a ridiculous premise: 1) That a highly paid professional in a city BRIMMING with recruiters and cool new companies throw…
Source: SF has 44.7% single people, St. Louis has 32.9% single people
Counterfactuals are very hard to know. At CircleCI, being in SF gave numerous advantages early on. We had multiple paying customers in the first two office buildings. We had multiple customers within walking distance, and many more within cycling distance. Being able to talk to real customers using the app was extremely valuable. Customers aside, there are tons of people willing to help, either through advice or intr…
"Not every developer in SF is as mercenary as you make it sound. For your first employee hire, you might find a single person living in an apartment in SF vs. a family man in St. Louis who has to pay for day care and save for college. Their salary requirements might be comparable." This is based on a ridiculous premise: 1) That a highly paid professional in a city BRIMMING with recruiters and cool new companies throw…
- there are some advantages, but it depends
- the advantages depend on your target market, the stage of your company, and your desired direction, in terms of bootstrapping vs. raising
- you can't know ahead of time which way (SF vs. STL) will be more advantageous, and you can't repeat the experience, because the second time you'll have more experience, more talent, etc. This is a path-dependent experience.
Maybe if they did the startup in SF, they'd meet an advisor who changed the direction of the company to something even better, or maybe they wouldn't, in which case low cost of living in STL is an advantage. But pointing at cost-of-living alone isn't a useful comparison.
You should have moved to Oakland. There's plenty of cheap real estate there, and it's on BART.
I've heard people calling it the Brooklyn of the Bay Area.
Right now outside of truly hot tech areas like SF the hiring scene is stacked heavily in employers' favor: there are fewer job opportunities with fewer companies. That's true even in places like St. Louis (or Austin, or any of a number of other supposedly "hot startup" areas). I get some recruiter-spam from St. Louis and Austin based recruiters looking for candidates for "hot" startups and established businesses in the areas, but these opportunities are all with hospital/medical companies (STL) or corporate-y .NET type stuff (Austin). It's a bit baffling, actually, since my resume pretty clearly puts me far outside of those boxes.
It seems to me there's an opportunity there for would-be startups to exploit. On the other hand, the very same phenomenon leads to a kind of resistance: the density of "talent" to draw from reduces substantially outside of the SF/Bay area because a lot of it has already been drawn here to the very same job imbalance.
That means that if you're fresh out of college with lots of student loans, you're doing yourself a disservice if you don't move to a big city and get a high paying job. You can effectively inflate your way out of your debt by making your salary much bigger in comparison (assuming COL and salaries roughly match up).
And if you're about to retire (without having Fuck You Money), you should move somewhere cheap, all else equal. The same could be true for many bootstrapped startups.
The problem is that the massively funded SF/SV start-ups will create the "scorched earth" regime for the bootstrapped ones: try moving to St. Louis and compete with a AirBnB from there? If you get traction, you will have to get VC money, which means moving back to SF or NY.
Why do VCs require companies to be in the city they are in? Can someone please explain this? We are talking about an industry whose product is supposed to transcend physical space, but we have to be located in an ultra expensive city to get funded? Where is the logic?
Maybe face time is important after all. Which makes the SV pumping of MooCs and other "disrupt education" pitches hilariously ironic and bleakly dishonest.
There's also the fact that California is regularly at the bottom of rankings of "business friendly" states. I'd rather locate my business in a state that wants me there.
I've never understood these "business friendly" rankings. If CA is so terrible to businesses, then why are there so many successful businesses in CA?
It's probably obvious to most, but I recently came to the realization that if you're paying off debt, a high COL works in your favor, whereas if you're living off cash, it works against you. That means that if you're fresh out of college with lots of student loans, you're doing yourself a disservice if you don't move to a big city and get a high paying job. You can effectively inflate your way out of your debt by mak…
If you're investing or saving 30% of your income, it's better to work somewhere with higher COL / higher pay. This way over time you accrue more wealth than you would if you were working in an area with low COL and lower pay.