While I'm not sure 'not' starting a company in silicon valley is valid (i.e. if I lived there I probably wouldn't move away to start a company), I am all about starting companies in area's with a lower cost of living. "staying alive" is easier in 'southwest airlines' cities.
Take a look at the map of where Southwest Airlines flies to and you get a feel for 'alternative' cities that should have enough infrastructure for a startup.
In my neck of the woods, albany,ny we were the excitement of the entire area. We were on the front pages of the local paper all the time. Recruiting was easier because people knew who we were and understood we paid less, but had the excitement they were seeking.
We got free legal advice because lawyers wanted to be associated with us. We won local business plan competitions ($100k cash). We got investment from local VC's wanting to build up the area.
We paid $1500 a month in rent, including all utilities, for a mansion on the hudson river (and lived in the 5 bedrooms on the second floor). Our internet (cable modem) was $40 a month and screaming fast because our neighbors probably didn't even have it.
That helped us 'stay alive' long enough to figure out how to make money.
So are you making money now? I think you are missing the point, a lot of startups in SV are not necessary started to "make money" in the traditional sense. There is a huge amount of startups who just try to build something cool (technology wise), and either hope to find out how to monetize, or hope a larger company will buy them, and figure out how to monetize their technology.
SV is the best place to be, if what you are building doesn't have a clear market, or the market requires larger company's muscles.
Maybe that's part of the problem... the echo chamber of people building things that don't have a clear market, or it's "just technology" and not a business by itself.
that's right. Youtube is not making any money (so it has no proven businness model), but it's founders are rich. So, I would say it is a huge success for them, but if you look at it in a traditional point of view, it is a failure.
The bottom line, they have millions in the bank, and you don't (ok, maybe you do, I don't know you).
If you plan to build some cool technology, and want to flip it to somebody else, that has the means to monetise it, the SF Bay area is the place to be.
If you want to build something small, and more of a traditional company, then a low cost area might make sense.
But have no boubt about it, some of the best talent is the bay area. It is like the Hollywood for geeks. The place where you can make it big. The place where the gold rush mentality will always prevail, as the people are drawn in here to make it big.
It seems that Web. 2.0 is out, and Green Tech is in. That's the new current bubble.
And I should point out the title was maybe a little over the top... the article doesn't really say you shouldn't start a company in SV, i.e., that you should move away... just that there are compelling reasons to consider not moving to SV to start that company.
Comments
While I'm not sure 'not' starting a company in silicon valley is valid (i.e. if I lived there I probably wouldn't move away to start a company), I am all about starting companies in area's with a lower cost of living. "staying alive" is easier in 'southwest airlines' cities.
Take a look at the map of where Southwest Airlines flies to and you get a feel for 'alternative' cities that should have enough infrastructure for a startup.
In my neck of the woods, albany,ny we were the excitement of the entire area. We were on the front pages of the local paper all the time. Recruiting was easier because people knew who we were and understood we paid less, but had the excitement they were seeking.
We got free legal advice because lawyers wanted to be associated with us. We won local business plan competitions ($100k cash). We got investment from local VC's wanting to build up the area.
We paid $1500 a month in rent, including all utilities, for a mansion on the hudson river (and lived in the 5 bedrooms on the second floor). Our internet (cable modem) was $40 a month and screaming fast because our neighbors probably didn't even have it.
That helped us 'stay alive' long enough to figure out how to make money.
So are you making money now? I think you are missing the point, a lot of startups in SV are not necessary started to "make money" in the traditional sense. There is a huge amount of startups who just try to build something cool (technology wise), and either hope to find out how to monetize, or hope a larger company will buy them, and figure out how to monetize their technology.
SV is the best place to be, if what you are building doesn't have a clear market, or the market requires larger company's muscles.
Maybe that's part of the problem... the echo chamber of people building things that don't have a clear market, or it's "just technology" and not a business by itself.
that's right. Youtube is not making any money (so it has no proven businness model), but it's founders are rich. So, I would say it is a huge success for them, but if you look at it in a traditional point of view, it is a failure.
The bottom line, they have millions in the bank, and you don't (ok, maybe you do, I don't know you).
If you plan to build some cool technology, and want to flip it to somebody else, that has the means to monetise it, the SF Bay area is the place to be.
If you want to build something small, and more of a traditional company, then a low cost area might make sense.
But have no boubt about it, some of the best talent is the bay area. It is like the Hollywood for geeks. The place where you can make it big. The place where the gold rush mentality will always prevail, as the people are drawn in here to make it big.
It seems that Web. 2.0 is out, and Green Tech is in. That's the new current bubble.
We always want to 'make money' in the traditional sense. If we loose sight of that we're gonna party like it's 1999.
(yes, we do make money)
(and yea, I worked in a Prince quote!)
And I should point out the title was maybe a little over the top... the article doesn't really say you shouldn't start a company in SV, i.e., that you should move away... just that there are compelling reasons to consider not moving to SV to start that company.