Ask YC: Is the Bay Area Much Better than Seattle for Startups?
26 comments
Noooooo, don't leave Seattle! <grin>
Why exactly wouldn't you apply for YC funding? Would get you rice and beans money and 3 month trip to startup school in CA... If you get selected, of course.
It sounds like your core unmet need is a technical co-founder.
If finding a technical co-founder is your highest priority, you should be able to find one in Seattle. Every event I go to I meet scads of "I work at Amazon/MS ad I'm just seeing what's out there" type of coders. How many of those have you talked to? Why aren't they jumping on board?
Like any other marketing, if you aren't getting a ton of nibbles with smaller audience (Seattle), expanding to a larger audience might not be the answer. It might be smart to address your idea or how you're pitching it.
All that being said, SF looks pretty cool. :-)
Why exactly wouldn't you apply for YC funding? Would get you rice and beans money and 3 month trip to startup school in CA... If you get selected, of course.
It sounds like your core unmet need is a technical co-founder.
If finding a technical co-founder is your highest priority, you should be able to find one in Seattle. Every event I go to I meet scads of "I work at Amazon/MS ad I'm just seeing what's out there" type of coders. How many of those have you talked to? Why aren't they jumping on board?
Like any other marketing, if you aren't getting a ton of nibbles with smaller audience (Seattle), expanding to a larger audience might not be the answer. It might be smart to address your idea or how you're pitching it.
All that being said, SF looks pretty cool. :-)
I moved to the Bay area for my Day job (ER nurse) while I complete my CS degree. Even as an ER nurse, 2-3 nurses that I work with are married to either VC's or angel investors.
One of our volunteers at the ER where I work is an executive assistant for a VC. Several other nurses are married to engineers who work for Yahoo, Google, etc... She's offered to put me into contact with whoever I want to in the VC world. I'm not ready for it yet, but I can imagine that she could arrange an introduction or two.
It's hard to avoid networking opportunities here. And, there is an acceptance even among the non-tech people that Startups are the place to be. It's the cultural norm to start a business here.
I've lived in Minneapolis, Chicago, outside of Boston, LA and now the Bay area. Every city is good at certain things. Tech and startups are what the Bay does, and we do it well.
One of our volunteers at the ER where I work is an executive assistant for a VC. Several other nurses are married to engineers who work for Yahoo, Google, etc... She's offered to put me into contact with whoever I want to in the VC world. I'm not ready for it yet, but I can imagine that she could arrange an introduction or two.
It's hard to avoid networking opportunities here. And, there is an acceptance even among the non-tech people that Startups are the place to be. It's the cultural norm to start a business here.
I've lived in Minneapolis, Chicago, outside of Boston, LA and now the Bay area. Every city is good at certain things. Tech and startups are what the Bay does, and we do it well.
i can't say whether you should move to SF or not, but i can tell you my experiences.
i've lived in both seattle and san francisco, and currently live in SF. though i was more involved with the corporate scene than the startup scene in seattle, the vibe is entirely different down here. startups live here. you meet tons of smart people working on cool stuff. it's a great place to be.
competition ends up being a good thing -- as LA is to many of the best (and wannabe-best) people in the entertainment industry, so SF is to the nerd industry.
even though it can be a bummer sometimes to be coding when the weather is beautiful outside (as it is now), i find the overall environment more stimulating -- intellectually, culturally, geek-ally. there are also plenty of outdoorsy things to do very nearby in marin and the east bay, though not quite as close as the options in seattle. the only thing i miss is a lower rent and the seattle music scene.
though i can't tell you whether moving will make or break your startup, SF can be a very wonderful place to live (and work).
i've lived in both seattle and san francisco, and currently live in SF. though i was more involved with the corporate scene than the startup scene in seattle, the vibe is entirely different down here. startups live here. you meet tons of smart people working on cool stuff. it's a great place to be.
competition ends up being a good thing -- as LA is to many of the best (and wannabe-best) people in the entertainment industry, so SF is to the nerd industry.
even though it can be a bummer sometimes to be coding when the weather is beautiful outside (as it is now), i find the overall environment more stimulating -- intellectually, culturally, geek-ally. there are also plenty of outdoorsy things to do very nearby in marin and the east bay, though not quite as close as the options in seattle. the only thing i miss is a lower rent and the seattle music scene.
though i can't tell you whether moving will make or break your startup, SF can be a very wonderful place to live (and work).
In short, no.
As far as I can tell the Silicon Valley offers value most to a very specific sort of start up. If you don't need to raise a lot of capital or require a large team of very gifted engineers (which probably requires a great deal of capital anyway), then I don't think the Valley is as valuable to you. That said, I think being connected to the important people in the industry may help your cause immensely. Perhaps spending the winter with YCombinator would accomplish that (as far as I can tell Mr. Graham is pretty important).
You also need to consider how much you value your home against the value you would bring your career. For me, moving away for a decade or two is a big deal.
No worries, I think there are a lot of good businesses that can be established by a few smart developers hacking away for a while, then launching and picking up angel funding as or if needed. I have a myriad schemes and I found that those criteria helped me cull the ten thousand to ten I am comfortable with and confident in.
It is easier to make a million dollars after a hundred thousand and a billion after a million. Don't get ahead of yourself.
As far as I can tell the Silicon Valley offers value most to a very specific sort of start up. If you don't need to raise a lot of capital or require a large team of very gifted engineers (which probably requires a great deal of capital anyway), then I don't think the Valley is as valuable to you. That said, I think being connected to the important people in the industry may help your cause immensely. Perhaps spending the winter with YCombinator would accomplish that (as far as I can tell Mr. Graham is pretty important).
You also need to consider how much you value your home against the value you would bring your career. For me, moving away for a decade or two is a big deal.
No worries, I think there are a lot of good businesses that can be established by a few smart developers hacking away for a while, then launching and picking up angel funding as or if needed. I have a myriad schemes and I found that those criteria helped me cull the ten thousand to ten I am comfortable with and confident in.
It is easier to make a million dollars after a hundred thousand and a billion after a million. Don't get ahead of yourself.
My perception, from experience, is that it's actually harder to hire in the Bay Area than, well, anywhere else. Anyone with a modicum of talent that you interview in Sunnyvale can pull a $130k/yr job out of their back pocket, and the BigCo alternatives in the valley are actually pretty spectacular.
If you need a large team of very gifted engineers, start in a college town that isn't Palo Alto or Berkeley.
If you need a large team of very gifted engineers, start in a college town that isn't Palo Alto or Berkeley.
I don't understand why lucrative alternatives are an obstacle.
That $130k/year makes trying a startup less risky. It gave them an opportunity to save so they can live off savings. It also means that they can recover quickly from any debt they incur.
It also establishes a benchmark for a startup's value creation. If early employees can't reasonably believe that they're going to get significantly more than $130k for their efforts, either the idea/execution is too small or the founders may not play well with others, which causes other problems leading to failure.
That $130k/year makes trying a startup less risky. It gave them an opportunity to save so they can live off savings. It also means that they can recover quickly from any debt they incur.
It also establishes a benchmark for a startup's value creation. If early employees can't reasonably believe that they're going to get significantly more than $130k for their efforts, either the idea/execution is too small or the founders may not play well with others, which causes other problems leading to failure.
You're making a lot of sense; I'm just saying, my experience was that it was harder to hire in the Bay Area than it has been for me to hire in NYC or Chicago, where I hire now.
It's also obvious that developers are more expensive to hire anybody in San Francisco than in Des Moines or Minneapolis.
Also, please note the bias towards founders in these discussions. A tiny team of founders is a good start, but you eventually need actual employees.
It's also obvious that developers are more expensive to hire anybody in San Francisco than in Des Moines or Minneapolis.
Also, please note the bias towards founders in these discussions. A tiny team of founders is a good start, but you eventually need actual employees.
There are lots of places where it's very easy to hire but that hiring ease comes from factors that reduce the success rate.
Does harder hiring in the SF Bay Area hurt or does it merely help weed out things that don't have a chance for some other reason?
As far as later stage employees go, successful silicon valley companies go elsewhere for what they can get elsewhere.
I think that you should start where you think that you have the best chance of success. I don't think that "harder to hire" or "more expensive" captures sufficient detail, but it's your company, so that's your call.
Does harder hiring in the SF Bay Area hurt or does it merely help weed out things that don't have a chance for some other reason?
As far as later stage employees go, successful silicon valley companies go elsewhere for what they can get elsewhere.
I think that you should start where you think that you have the best chance of success. I don't think that "harder to hire" or "more expensive" captures sufficient detail, but it's your company, so that's your call.
I think you should ask questions of the conventional wisdom. The conventional wisdom says one of the reasons to move a company to the Bay Area is that it's easier to hire developers. You should question whether that's really true. I gave some reasons why I think it might not be, and cited my experience. I don't think it's true. But you make the call.
Also, careful with words like "later stage". You're "later stage" as soon as you hire the first person who isn't getting a founder's stake in the company. For us, that was weeks, not months, after the birth of our company.
Also, careful with words like "later stage". You're "later stage" as soon as you hire the first person who isn't getting a founder's stake in the company. For us, that was weeks, not months, after the birth of our company.
That's odd. I see founders, early, and maybe another round of folks before "later".
To me, "later" isn't until the biz is well beyond self-sustaining, when there's very little risk of failure.
To me, "later" isn't until the biz is well beyond self-sustaining, when there's very little risk of failure.
I understand, and am not arguing with you. Whatever you want to call them, that "second round of folks before later" is harder to hire than the founders. They're employees, not principals, and you can't bullshit them.
"Can't bullshit" sounds like a good thing.
I'm not disputing harder to hire, I'm asking whether harder to hire is a negative or a useful indicator.
I'm not disputing harder to hire, I'm asking whether harder to hire is a negative or a useful indicator.
If, holding talent constant, a developer costs $100k in the bay and $65k in Ann Arbor, Michigan, then Ann Arbor startups have a pronounced recruitment advantage. That's all I'm saying.
The conventional wisdom is, "go to the Bay Area, it'll be much easier to find smart developers." It is, in fact, very easy to find smart developers in the Bay Area. Unfortunately, they work for Google.
The conventional wisdom is, "go to the Bay Area, it'll be much easier to find smart developers." It is, in fact, very easy to find smart developers in the Bay Area. Unfortunately, they work for Google.
I'm assuming you attend Seattle Tech Startups at the library every month (if you don't, you should, you've got a pretty good chance of finding a co-founder there).
Having lived in both places, I would personally rather start a company in the Bay Area all things considered.
Having lived in both places, I would personally rather start a company in the Bay Area all things considered.
Yes I do attend the event most months. It's a great group... many thanks to Gaurav setting it up, and folks like Tony for coming and speaking.
there's a good reason for bay area to be that expensive (quoting your stuff, higher rent,higher competition,etc) and if you are in doubt simply follow the money.
not that you cannot do what you wanna do in seattle, I have lived in SF and now in Cambridge. I can simply tell you the vibe is far far better and you get stimulated to take risk when you see people around you taking far more risks (in seattle you are more likely to encounter people who say job is fine, buy house,have kids,etc). So yeah! my vote, move to the bay and be pleasantly surprised by what it offers
not that you cannot do what you wanna do in seattle, I have lived in SF and now in Cambridge. I can simply tell you the vibe is far far better and you get stimulated to take risk when you see people around you taking far more risks (in seattle you are more likely to encounter people who say job is fine, buy house,have kids,etc). So yeah! my vote, move to the bay and be pleasantly surprised by what it offers
There was an article in Business 2.0 Magazine awhile ago titled: "Escape from Silicon Valley". OK, I just found it for you:
http://money.cnn.com/magazines/business2/business2_archive/2...
Although it discusses the pros and cons of big city vs. little towns for start-ups, it also touches upon a variety of factors which seem to be relevant to your question.
I started my startup in a tiny place (Flagstaff, AZ) thinking I could make it work there. It almost did, but the reality is that there are numerous benefits to be had not necessarily from living here (SF), but from having the contacts and network of people in this area; living here just happens to be one of the best ways to get it.
I lived in Portland, OR for awhile, and visited Seattle a few times. I seem to remember something about abnormally high depression and suicide rates being cited for residents of Seattle . . . also, isn't Seattle one of the few places that has had cost of living increasing significantly / deviating from the norm? Not to knock Seattle (hey, hey -- no income tax in WA state), but the success of a startup I imagine would be correlated to happiness of its founders/employees.
Anyway. One of the things that I think makes this area such a hub of successful startups is that people here truly believe they're going to change the world. And, a lot of them end up doing just that. :)
http://money.cnn.com/magazines/business2/business2_archive/2...
Although it discusses the pros and cons of big city vs. little towns for start-ups, it also touches upon a variety of factors which seem to be relevant to your question.
I started my startup in a tiny place (Flagstaff, AZ) thinking I could make it work there. It almost did, but the reality is that there are numerous benefits to be had not necessarily from living here (SF), but from having the contacts and network of people in this area; living here just happens to be one of the best ways to get it.
I lived in Portland, OR for awhile, and visited Seattle a few times. I seem to remember something about abnormally high depression and suicide rates being cited for residents of Seattle . . . also, isn't Seattle one of the few places that has had cost of living increasing significantly / deviating from the norm? Not to knock Seattle (hey, hey -- no income tax in WA state), but the success of a startup I imagine would be correlated to happiness of its founders/employees.
Anyway. One of the things that I think makes this area such a hub of successful startups is that people here truly believe they're going to change the world. And, a lot of them end up doing just that. :)
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more SEA PROs: 1) No state income tax 2) Very Green/Environmentally Friendly (until Seattle gets overcrowded) 3) Perfect Summers (beats anywhere in the country)
more SEA CONs: 1) It does not RAIN a lot. It drizzles a lot, but recent studies in the last decade have shown that Seattle's average rainfall in the given year is ranks like 46th outta 50 US states. So if you don't mind daily drizzle, then ya fine. 2) SEATAC airport is not a major hub, so expect inconvenience and pricier tickets if flying to most major cities around the continental US.
Although you can make arguments on the pro's/con's of any given city. Seattle makes more sense in that its lower overheard for your startup. When you hit it mega-big, then you can live in both areas and fly daily for lunch in SF and dinner in SEA.
more SEA CONs: 1) It does not RAIN a lot. It drizzles a lot, but recent studies in the last decade have shown that Seattle's average rainfall in the given year is ranks like 46th outta 50 US states. So if you don't mind daily drizzle, then ya fine. 2) SEATAC airport is not a major hub, so expect inconvenience and pricier tickets if flying to most major cities around the continental US.
Although you can make arguments on the pro's/con's of any given city. Seattle makes more sense in that its lower overheard for your startup. When you hit it mega-big, then you can live in both areas and fly daily for lunch in SF and dinner in SEA.
The "less competition for talent" argument doesn't seem to matter in practice, probably because the first 10 people you hire always (or always should) come through personal connections.
If you love it, then of course stay there. Geez, stupid question.
Well, if I were to get fully involved in a startup, I'd love to stay south of the Mason-Dixon (Florida). It's nice to be able to not wear a coat from March to November.
you've listed pros and cons - but you have to prioritize yourself. So what's more important to you - a co-founder or less rent and so on... are you certain you cannot find those things you think are important in seattle ?
Why not develop a prototype or beta at home, then after you've got something working go to the Bay and start from there!
Great call... I actually already have a prototype of the product built... now it's about improving it and selling/marketing it.
Ahh, then its time to move to San Francisco :)
I lived in Seattle in 1995 starting in August and was able to survive there only until February - the lack of sunshine was far too depressing for me to cope with. At the time, I helped start an architecture office (HOK) specifically to build part of the expanding Microsoft Campus (I was completely impressed with the MS real estate management pros). So I can only answer based on quality of life, and San Francisco (for me) wins hands down. We also have nature here just a short bike ride away (crossing the GG bridge) and we have world-class skiing about 3 hours away. The cultural scene here is extremely rich compared to Seattle. There are also deals to be had in office space (I pay $1 per s.f. per month) but you have to look (I found mine on Craigs List).
I'm working full time in a software company in Seattle area and will be leaving soon to work full-time on my startup. (I already have already released a prototype of my product). I'm tempted to stay in Seattle as I love it here... but my startup is my first priority, and I'm prepared to move anywhere in the world if it means I'll have a significantly higher probability of success. Finally, I'm a single founder and potentially looking for a technical co-founder... so where I can find this person factors in to the decision as well.
Questions for you: 1) For those of you who have lived in Seattle & San Francisco, how much better is SF for startups than Seattle? How do you quantify this? 2) I have a quick list of pros/cons to Seattle vs. SF below... can folks provide feedback on whether this analysis makes sense? 3) Any other thoughts on whether I should make the move or not? 4) Where is better for finding like minded entrepreneurial hackers?
Pro/Con for Seattle vs. SF Seattle Pros: lower cost of living, closer access to outdoors & mountains etc..., lower cost of rent for offices, lower legal costs, less competition for top quality talent than SF (there are fewer startups in Seattle so people who want to work at them have fewer choices on where to go), monthly startup events have on the order of ~50 people or so, rains often so you're more likely to sit inside coding than going outside Cons: rains a lot :P
SF Pros: epicenter of startups, monthly startup events (SFBeta etc..) have on the order of ~100 people, huge talent pool of highly skilled engineers, more likely to find technical co-founder, more startup events, more access to capital, closer to family SF Cons: higher cost of living, higher cost of rent, higher cost of services (leagal etc..), harder to get top quality talent (you're competing with hundreds of startups), more competition for capital
PS: I have already read PG's essays and read the YCNews forums on where to be for a tech startup. I've also recently read Marc Andreessen's post on where your startup should be (he reccomends moving to the Valley). Finally, I have a friend who recently quit Google to work on his startup full time in the Bay Area and he extols the advantages of the location.