I’ve recently visited the San Francisco Bay Area, aka Silicon Valley, to initiate investment talks for GeneDig. Prior to my visit, I did find some truth about statements like “Location does not matter, internet economy is the most global economy out there.” After my recent visit, I can tell you quite confidently that all this talk is bullshit.
Silicon Valley is the best for a reason. Instead of being dazzled about its history, I have tried to improve my understanding of what makes Silicon Valley special. I came up with 6 main reasons:
1. Access to Capital: I know, some will say this is a cliche, but it is true. During the second quarter of 2014, Silicon Valley’s venture capitalists invested a total of $7.1 billion in startups (and this doesn’t include angel investments!). In 2013, Canada had a total of $1.0 billion in venture investment (E&Y report). So, in a single quarter, Silicon Valley invested 7 times that of Canada’s yearly total! And don’t get me wrong, Canada is doing pretty great in venture investment (top 5 in the world), so don’t even get me started for other countries’ comparison! Also, it was a pleasure seeing my first ever co-founder (when I was 19) raising several million dollars in funding, pre-launch(!) – something that is so magical that can only happen in the Valley.
2. Access to People: Whatever it is you are building in high tech, chances are, an accomplished individual will be a short drive away – that is, if you live in the Valley. I’ve had several friends who told me that they’ve met Jimmy Wales (founder of Wikipedia) and Jack Dorsey (co-founder of Twitter and Square) for advice in what they’re doing. Nothing can match the value of getting great advice from the world’s greatest in whatever you’re doing.
3. Access to Talent: This is similar to the point above. All the best people in high tech are concentrated here. The IQ distribution per meter square of this place is unmatched. You have the access to best engineering talent in the world, it comes at a cost though.
4. Culture: When the best of the best live in a very concentrated area, this habitat creates a culture. Everyone in the city is talking and living tech. There is this culture of “thinking big”. I recall one of my friends during my visit asking for $100,000 investment for his startup. One of the venture capitalists laughed and said, “What are you going to do with $100K?” My friend answered, “It’s just me and my partner for now, we don’t have that many expenses.” The VC explained that this is a sign of thinking small and not thinking for future already. You have to give it to my friend though, your expenses in a city like Montreal where a yearly average software engineer salary is $60K and monthly rent can be as low as $400, it doesn’t quite match the Valley’s $100K average base salaries and $2K monthly studio rents. Regardless though, I’m clear about one thing: people in the Valley favor new ideas and innovation, they support new disruptive startups against their big brother counterparts – all because of this culture.
5. Word-of-Mouth: Regarding the culture discussed above, people constantly talk about new startups and how it made their lives easier. With no specific goal of marketing GeneDig to anyone except investors during my visit, I’ve seen our visitors from California raise dramatically within a few days. I tracked down some of these visitors, because they contacted me through our website, asking more about our product. Some turned out to be a girlfriend of a guy whom I pitched my startup, some turned out to be a brother of a guy I’ve met at a pool party and some turned out to be a partner of an investor – which is the highly desired case 🙂
6. Work Ethic: The work ethic in the Valley is unmatched. I’ve been to several startup houses of my friends. People live and work together. They work from Sunday to Friday. They throw a big party (pool parties, yeah!) on Friday nights, rest on Saturday, and get back to work the next day. This is my biggest complaint about where I live, Montreal. In a city where there is so much emphasis on joie de vivre (joy of life) and work-life balance, you struggle to keep people in the office after 5PM. Even all the stores are closed after 6PM, except restaurants and nightclubs (and with some exception of big malls). People draw quite an obvious line between their work and life in this city. In the Valley, work = life, because people are so much into this culture of thinking big and changing the world.
After this visit, I have to say that I’m not delaying my plans to move to the Valley anymore. I will try to get there as soon as possible and work with fellow like-minded and hard-working people who are also not afraid of thinking big.
This article has also been published at http://emiraydin.com/what-makes-silicon-valley-special/