Starting a Company Outside Silicon Valley Just Saved Me $1.1M • Hacker News Board

Re: Starting a Company Outside Silicon Valley Just Saved Me $1.1M

#71

Post by samprotas » Wed, Jan 23, 2019, 8:06 PM UTC

I find it kind of odd that there are all these comments claiming the article glosses over nuance and therefore its conclusion is baseless when the counterpoints have even less data.

Everyone seems to agree successful companies have started in SV and outside of SV, and that there’s a lopsided distribution. No one has spent much time on whether the location is the cause of or just correlated with success. I get that this is hard to determine, but maybe people should speak in less absolutes? The article is one persons decision making process, explained for the benefit of others. I don’t think it’s claiming to be The One Truth.

Disclaimer: I worked for the author in Philly previously.

Re: Starting a Company Outside Silicon Valley Just Saved Me $1.1M

#72

Post by jryan49 » Wed, Jan 23, 2019, 8:17 PM UTC

adventured wrote: post #43

inputcoffee wrote: post #12

I think there is an error in the title. It should read: "Starting a Company Outside Silicon Valley Saved Me Just $1.1M"

I agree. I was surprised that the gap was so narrow. Only costing 25% less is not a favorable outcome for Philadelphia given how expensive Silicon Valley is. If I can do Philly for $3.3m or SV for $4.5m, that's an easy choice. The valuation boost you'll get for being in SV instead of Philly will cover that several times over. The network and talent available in SV is worth suffering that gap all by itself. The only w…

So 25% more runway has no value?

Re: Starting a Company Outside Silicon Valley Just Saved Me $1.1M

#73

Post by driverdan » Wed, Jan 23, 2019, 8:26 PM UTC

true_tuna wrote: post #45

sontek wrote: post #10

Earlier quoted context omitted.

What would the opportunity cost? What does silicon valley have that philly doesn't?

A community of experienced technologists. Veterans of successful ventures can skip many mistakes due to experience.

Those exist everywhere. The Bay Area doesn't have a monopoly on experienced software developers.

Re: Starting a Company Outside Silicon Valley Just Saved Me $1.1M

#74

Post by apohn » Wed, Jan 23, 2019, 8:26 PM UTC

duxup wrote: post #66

true_tuna wrote: post #52

Earlier quoted context omitted.

I saw this happen in reverse. I was buying servers from Rackable in orders of several millions of dollars. They bought SGI. Fired their Bay Area support staff, moved support to Ohio which was a huge short term gain. But support became so bad it was literally worth less than nothing. They would take in a machine with a known fault (raid controller let’s say) fail to replace the card, ship back a machine that didn’t bo…

One of the downsides of my support example is that there is a lot of outsourcing and cost cutting in that area of work (one of the reasons I left). So there will be tons of stories like yours that I don't doubt are true.... it's just location probabbly had less to do with it as just a general desire to cut costs at any cost...

>it's just location probabbly had less to do with it as just a general desire to cut costs at any cost...

Exactly this. In a previous role at an Enterprise software company I watched customer satisfaction take a dive after cost cutting measures and support and escalations paths and metrics were changed. The same customer support people who had really happy customers started to have unhappy customers. It had very little to do with the people or location and everything to do with what options the customer services people had to help a customer.

Re: Starting a Company Outside Silicon Valley Just Saved Me $1.1M

#75

Post by driverdan » Wed, Jan 23, 2019, 8:28 PM UTC

aantix wrote: post #54

Sadly, if you're an engineer, those savings aren't passed on to you (obviously). If you're a software engineer and want to make an amazing salary by most people's standards, move to the Bay Area and get a job with Google/Facebook/LinkedIn/Etc. You can literally make a 500K+ a year.

> You can literally make a 500K+ a year.

People need to stop repeating this nonsense as if everyone makes that much. A very small percentage makes that.

Re: Starting a Company Outside Silicon Valley Just Saved Me $1.1M

#76

Post by Finbarr » Wed, Jan 23, 2019, 8:38 PM UTC

jedberg wrote: post #56

unignorant wrote: post #23

Earlier quoted context omitted.

In US we do payroll. For other countries the employees are legally contractors, though still with equity and not treated any differently from anyone else on the team

> For other countries the employees are legally contractors How do you actually pay them as contractors? Do you literally just wire them USD or do you some service?

Not OP, but we are fully remote with a similar sized company and we just wire USD every month after they send us invoices. It’s pretty easy.

Re: Starting a Company Outside Silicon Valley Just Saved Me $1.1M

#77

Post by lotsofpulp » Wed, Jan 23, 2019, 8:51 PM UTC

jlarocco wrote: post #64

Nasrudith wrote: post #49

Earlier quoted context omitted.

Personally I think ego is part of the issue - VCs don't want to admit they don't always need "the best of the best talent" for their application. Especially if their actual product would still be a turd no matter how polished like Juicero - there is no real sophistication needed there, they just wanted to copy Keurig to get rich.

> Personally I think ego is part of the issue - VCs don't want to admit they don't always need "the best of the best talent" for their application. I'm sorry, but isn't that the same bigoted mindset? Unless there's real evidence that the valley actually has "the best of the best talent". Every time I see that claim, though, it boils down to some kind of circular logic. I would definitely agree SV folks think they're…

The multitude of world changing organizations, especially by market cap, that have come out of SV is some evidence. Not that that means “best of the best”, but if I were to bet on where something transformative will come from, SV would still be on my short list.

It’s all about playing the odds, not necessarily being absolute about statements like best of the best.

Re: Starting a Company Outside Silicon Valley Just Saved Me $1.1M

#78

Post by froindt » Wed, Jan 23, 2019, 8:52 PM UTC

true_tuna wrote: post #52

froindt wrote: post #29

Earlier quoted context omitted.

> There was this idea that support just had to be in the valley because straight up the managers and folks working there didn't know there were technical people... anywhere else (this was before we had other islands of tech in the US). I saw a friend from the Midwest was on the board of a non-profit group. The headquarters was in the DC suburbs, but did no lobbying, mostly verifying credentials and conducting trainin…

I saw this happen in reverse. I was buying servers from Rackable in orders of several millions of dollars. They bought SGI. Fired their Bay Area support staff, moved support to Ohio which was a huge short term gain. But support became so bad it was literally worth less than nothing. They would take in a machine with a known fault (raid controller let’s say) fail to replace the card, ship back a machine that didn’t bo…

I guess as with everything - context matters.

Their overall goal was to be as effective as they could be. The cost savings went along with operational improvements. It was also a non-profit, which has an entirely different dynamic compared to a for-profit customer relationship.

I'm totally on-board with there being region-specific niches where it simply works better to have support in that area.

Farmers from the Midwest get pretty annoyed when Congress passes laws which cannot, in any practical/economically feasible way, be followed. The laws may be perfectly reasonable when looking at factories, but make little sense applied to farmers

Re: Starting a Company Outside Silicon Valley Just Saved Me $1.1M

#79

Post by mschuster91 » Wed, Jan 23, 2019, 9:03 PM UTC

jillesvangurp wrote: post #50

There is talent outside the valley and you can get it at a discount. I live in Berlin but I've worked with lots of Polish, Rumanian, Belarusian, Russian, etc. colleagues spread all over Europe. Good hard working people, with solid academic degrees, plenty of experience, up to date skill sets, etc. You can hire an entire team of them for the kind of money valley based teams spend on a single person. It doesn't even ha…

> From what I've seen, there sure are a lot of not so great developers working in the valley. At least judging from the copycat designs, the clumsy UIs, chronic UX issues, etc. from typical startups I don't think that the grass is greener over there in any meaningful way.

This is not the fault of "not so great developers", this is the fault of "agile development".

Whereas a decade ago you could go into a store and buy an AAA game, you could expect that it was free from major bugs and generally playable from start to 100% on decent hardware. Today? Gonna be happy if the patches on first run are not consuming more space than the original game itself and you don't have the feeling that the game you shelled out 50$ for is not just a green banana that ripens at the customer.

The same is valid for general software and especially web apps. Time-to-market is everything, who needs a QA department (it can all be done by developers in their spare time / overtime, no need to hire persons who know how to write proper testcases), who needs a proper ops department (the people who actually know about how Linux operates, what security is and what ACID means, compared to full-stack devops developers who cost a tenth of the money a good DBA or system architect can command) and if it works in a half baked A/B test (cheaper than running user studies or, heaven forbid, actually inviting power users from your target market to fly to you and show you how they use your product) then it gets rolled out indiscriminately to all your users. And when the pile of layers of shoddy bugfixes and other general crap (e.g. foundational architectural issues) finally collapses after a couple of years, the original creators have long since jumped ship and cashed out. It's definitely not sustainable.

Re: Starting a Company Outside Silicon Valley Just Saved Me $1.1M

#80

Post by sidlls » Wed, Jan 23, 2019, 9:17 PM UTC

ghaff wrote: post #65

true_tuna wrote: post #57

Earlier quoted context omitted.

Where did you move? I’d guess 50% of the people in this thread are open to leaving the Bay Area if we find a location with comparable opportunity.

The thing is that "comparable opportunities" equates to (perceived) Bay Area salaries which are more or less equated to higher-end FAANG salaries and the (perceived) ability for a random engineer to drop a few emails and be starting in a new well-compensated position the following Monday. You're not going to get those most places. I'm not sure it's the norm in the Bay Area either though.

I don't work at FAANG. My "all in" is about 65% what I'd earn at FAANG at the same level (EM, L5/6). It's about 150%, or more, of what I'd earn just about anywhere else in the US. Not to mention the opportunity cost: most anywhere else the software job market is not nearly as well developed.

It is absolutely the norm in the Bay Area for salaries even adjusted for cost of living to be far better than elsewhere. Plus all the additional attractive features like a relatively more tolerant population, much more diversity, better public venues like parks, and recreation like museums and such.