Observations from Silicon Valley

If you've been following my Twitter stream @Evanish you know I'm visiting the Valley this week. As I wrote months ago, I think a startup in our interconnected world has to be TriCoastal. I've made a number of trips to New York City in the last year, but it was finally time to make a pilgrimage to Silicon Valley. I came to learn how much of the rumors that reach Boston are true and get a feel for what the real differences are between the two coasts.

Observations from Silicon Valley

1) FACT: The Talent War is real....sort of.

One of the major claims that veterans in Boston make as a strike against the Valley is the difficulty in hiring and retaining talent. After asking veterans and newcomers of all ages and experience levels, I've concluded that it's true, but only to an extent. Yes, Google and Facebook are making major offers and there's tons of startups all competing for talent, but there are also many many more people here in the talent pool.  Employee number 5 for you is not likely to go to Facebook or Google to be employee X,000, but you might just actually get a Facebook or Google employee to join your company for the benefits of a startup (something that doesn't happen as much in Boston).

Hiring is a soft skill that's often overlooked. Good companies have great culture and attract the best talent. They also likely buy into the "Always Be Recruiting" theme that seems to escape so many companies that don't even write interesting job rec's let alone speak at events or to students.

On a related note, Silicon Valley VCs have Boston students in their crosshairs. We need to wake up and get our "stuff" together or Marc Andressen's comment about a brain drain will be true.

2) MYTH: Job hopping is rampant in the Valley.

Equity is a big deal in the Valley. Many people value it quite a bit as employees and it's much more of a negotiable issue than it seems to be in my experience in Boston. Of course to get equity, you need to stay at least a year.  From what I've heard the bottom line is : if your company has a bad culture, every employee has tons of options and will exercise them, but job hopping is not an epidemic here.

It is true that people tend to spend less time at a startup than a Boston company (1-3 years in SV vs. the 2-4 years I've seen in Boston), but it's actually considered an asset here, because it means you have a more diverse background and experience set.

3) FACT: The Valley is an open meritocracy of the purest sense.

It is absolutely incredible to me how open the community here has been. I've been amazed how easily I've been able to get intros and meet with people here. Everyone has been friendly, open and tremendously helpful. Anecdotally, stories from those I've spoken to have shared this feeling. 

Boston could use to learn from this; if I could bottle this culture and bring it back, I would. To function properly, an entire ecosystem has buy into it, and I think we have work to do to have everyone on board with this concept.

4) MYTH: It's difficult to have a lot of meetings in the Valley in one day.

Another "anti-Valley" comment I've heard is the difficulty in packing in a bunch of meetings in the Valley because it's so big.  That's a bit of a misnomer. Yes the Valley is spread out, but there's some great hubs in SF (SOMA), Palo Alto, and Mountain View. Assuming you come for more than a single day, there's a great chance you can get a lot done in both those areas.

The key is that the Caltrain is clutch. It can take you all through Silicon Valley for super cheap. There's wifi on the train so you can even work while riding.

5) FACT: It's more expensive to live in the Valley than Boston.

Housing costs in the Valley are absolutely insane. A quick search of Craigslist in San Francisco reveals some exhorbitant real estate prices that will bump up even the tightest of penny pincher's burn rate. The cheapest I heard anyone can live on in the Valley is $3,000 per month. In Boston that's closer to $2,000 per month.

On a related note, actually finding a place seems to be utter madness. I heard more than one horror story about entrepreneurs responding to 50 Craigslist ads per day and still not being able to find a place.

6) MYTH: Boston startups don't need to spend any time in Silicon Valley.

I ran into another Boston entrepreneur by chance in Palo Alto yesterday and we had a very interesting conversation about some of the anchor company advantages of the Valley; many of the companies with the biggest check books are in the Valley. As Dan Martell wrote recently, it's all about getting started early and building a relationship. You can only do so much of that remotely. There's tremendous value to helping a potential acquirer get comfortable with you face to face.

In addition to the acquisition reason, there's obviously funding you can raise here and tons of smart people to collaborate with. There's absolutely no reason not to take advantage of it; you're only handicapping your startup otherwise.

7) FACT: Silicon Valley thinks differently than Boston.

One of the most fascinating aspects of my exploration of the Valley has been the discovery of a totally different mindset out here. People are more open. They're more optimistic. They're less analytical than we are in Boston but at the benefit of heightened creativity. There's this raw energy that feels like some type of inevitability of good things happening.

Boston is much more about grinding out great companies and being highly analytical. It's probably why we've done so well in enterprise and B2B and less so with B2C; even our B2C companies are analytical (think about all the e-commerce data Gemvara crunches or the data play RunKeeper is making).

This is not to say that either is wrong. They're just different and it produces different companies and different entrepreneurs.

8) MYTH: Boston is the same as Silicon Valley.

It's hard to explain Silicon Valley. You have to experience it to really understand it. As much as I'd like to bring back a bunch of things I learned to help make Boston better, much of it feels deeply rooted culturally and that isn't something you can easily change.  We are unlikely to ever make Boston = Silicon Valley, so we're better off just trying to be the best Boston we can be.

9) FACT: Startups are hard anywhere.

Silicon Valley's roads are not paved with gold. VCs aren't handing out checks at stoplights. Business models and traction aren't handed out on the Caltrain.  Even Y Combinator does not actually ensure success (or even the guarantee of raising money). 

No matter where you are, startups are a ton of hard work and you're more likely to fail than succeed. A location is not a silver bullet to startup success, so keep it in perspective when deciding if you should build a company in Boston, NYC, Silicon Valley or any of the other startup hubs; it's hard anywhere and in our global economy, great companies are being built everywhere.


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