Portland wants to transform its software culture into an industry | Hacker News Reader

Portland wants to transform its software culture into an industry

blog.oregonlive.com

49 pointsturoczy32 comments

As someone that tried very hard to raise even a little money in Portland before getting into Ycombinator and ultimately raising 6 million this idea is DOOMED.

We did the Portland Angel Fund (or whatever it's called) American Idol off for start-ups...total joke. The whole industry is dominated by 'service providers' that look to charge start-ups for everything while writing no checks.

They actually asked us to come back and speak at one of their conventions and wanted to charge us almost $400.

There is no follow on capital. There is no entrepreneur culture. I love Portland and Oregon (grew up there, went to OSU), but this is a waste of time and money.

Is that the event put on by the Oregon Entrepreneurship Network? I have been very skeptical about all their events (really, to do anything I need to shell out HOW much? To go to a pub and drink a beer even?). I wouldn't say the idea is doomed. Even if it isn't successful, at least it's something in the right direction.

The OEN is one thing but the Portland tech scene shouldn't be characterized by such an organization with what might be called "outdated" policies.

My feelings are that Portland has talent and what it needs is seed funding and mentoring. Something like an incubator... I believe that this imbalance is the "problem" with Portland.

You are right to be skeptical.

The reason why i say it is doomed is (i'm not sure it's this plan so i could be jumping the gun) because one of the plans that is being implemented we were interviewed by one of 'LPs' and the info about how the 'funding' works was very sketchy.

It pretty much boiled down to pick 4-6 companies and give them loans that can be called back at roughly anytime and are personally guaranteed.

When we (my partner and I) looking for money in portland and working on our start-up at the same time even giving BrainTree a few thousand bucks as guarantee was out of the question. The idea that any young, early start-up wants loans with personal guarantees makes no sense. If anything just get 5-6 credit cards and max them out to finance it. It's easier.

I love Portland and Oregon (grew up there, went to OSU), ...

That points out one of the problems the Portland area has. Most states the size of Oregon split their funding between two major state universities and a number of smaller ones. Oregon splits the bulk of the funding between OSU, UO, and PSU. The strongest tech school is OSU - 80 miles from Portland. PSU is OK, but hardly a talent feed for local startups. OGI had a decent little CS program, but when it folded I don't think PSU's status came up much.

...but this is a waste of time and money.

I hope this pans out, but the ideas vs. execution rule applies to government initiatives as well. The City of Portland has a terrible track record for its own IT projects, so I don't have a lot of faith that they can lead private industry where they themselves have failed.

The biggest thing I'm afraid of is that it will be something like the Portland Seed Fund, which claimed to be YCombinator like, but is really a flawed effort: http://siliconflorist.com/2010/10/04/portland-seed-fund-y-co...

It also has too few (one, right?) major, international airports.

AFAIK, Seatac is the next nearest, over 100 miles away, and another singleton airport.

I agree with Erik. We tried raising money from the same groups in Portland and ended up getting ripped off by some of the people volunteering in these groups.

Portland venture capital is picking up (and we've been lucky to be a part of that). An important note is that most of the money isn't coming from Portland and it's not coming in small amounts. Serious investments are coming in from out of state VC firms.

Dedicated entrepreneurs exist and are making a go at it here - and doing quite well.

I'm wary of most of these organizations, but I do have high hopes for the software startup scene here.

The problem with Portland is talent seems to be hidden. I haven't explored too much in the time I have been here, but the bits of exposure I have had didn't seem too promising. Contrast that to a larger area like Seattle, or a very talent-dense area like Silicon Valley, and you have the opposite problem of sorting through talent.

Additionally, there are very few resources for people just starting out. There is the Oregon Entrepreneurship Network, but with their fee structure it seems to be more of a business than a resource for a small business. You have to pay annual membership dues, and from there you have to pay entry into their events. Want to go to their monthly pub talk? Yeah, that'll be $30 for non members, and $15 for people already registered with the OEN.

Of course talk is cheap, why not put together something myself? From the few events I have been to, the SNR was poor enough to be intimidating. 2/3 social media consultants, 1/4 looking for a free lunch and the rest as lost as me.

There are local tech events happening pretty much every night of the week. http://calagator.org/ has a good listing. It's to the point where you can't pick a night to do a user group/meetup without it conflicting.

You might want to start there when trying to find talent... though for what it's worth we haven't had a hard time finding talent lately. Lot of competing people away, but that's hardly new or different.

I know of the list and have been to a few meetings. When I mentioned I didn't see much going on, I meant there didn't seem to be a cohesive group of entrepreneurs. There are plenty of user groups and other nerdy meetings, but I haven't had luck connecting with other people attempting to get a business off the ground. Yes, PDX has nerds and programmers and people interested in tech, but, it doesn't have many software entrepreneurs to connect with.

That's also the impression I got when I spent a couple of months in Portland last year.

Somewhat unrelated, there's a lot of interesting programming language companies around (Galois, Gemstone, and some others I can't remember now). I don't have hard data, but have the impression that that's a lot more than average for other US cities with high-tech sectors.

To be honest the OEN ( Oregon Entrepreneur Network ) is one of the worst things for startups in Portland. The people who actually run it are great, they work really hard and have the best intentions, but the problem is the "volunteers" who serve on the boards and run the various committees. Most of these people are service providers, a lot of them are "money finders" who claim to broker deals between startups and investors. I know of a number of companies who have been ripped off by these people simply because they thought it is what everyone else is doing and the only way to get funding, the problem is they rarely deliver. The people who serve on the OEN committees for Angel Oregon etc are the same people that sit on the panels for PAN, Oregon Angel Fund and WIN ( Women's Investment Network ).There is a lot of crap that goes on behind closed doors in these committees that makes me sick.

The OEN has the best of intentions, but the committees comprised of service providers makes it impossible for startups to get a fair shake really, the people on these committees who are supposed to help startups are actually preying on them. Startups are asked to pay a lot of money for competitions, where they are told they will be pitching to investors, I don't know a single company in the past few years who has received money from any of these people.

There are actually a lot of investors in Portland, but the "super angels" are not part of any of these groups for a number of reasons.

Again I love the people who run the OEN, the folks that actually work there day-to-day, the problem is their board and the committees using their volunteer position for self enrichment.

If you look at the companies getting funding in Portland, most have stayed away from the traditional angel funding routes like the OEN events and instead focused on getting investment outside of that network and outside of the state.

Here's hoping they succeed. Portland would make a great tech center. It certainly has that counter culture attitude. And it's highly livable.

Now they just need the jobs and talent - that's the hard part.

There's a reason that some of the best open-source conferences happen in Portland, and it's not just because Linus Torvalds lives nearby. Portland is a remarkably livable city with a fairly deep talent pool.

And, they have their own TechCrunch: I believe most writers for ReadWriteWeb are Portland-ers.

Portland is easily my favorite US city. Great downtown, good vibe, fantastic outdoors, and the best bookstore in the world.

Make non-compete agreements unenforceable there and I would consider moving there.

Now if you really want a leg up on California, also consider make non-poaching agreements unenforceable.

Oregon should also do the "work done after hours is your own" thing that allows Californians to do "startups in their garages". Literally.

What they call "dogfooding" has a different name when it comes to the relationship between government and business - subsidy.

If shielding local industry from competition is the mayor's idea of creating a new market, Portland's efforts should probably start with getting a better mayor.

The mayor was elected by the citizens of Portland and is paid with their tax dollars. One of his primary mandates is to improve the local economy. Why should Portland not use those tax dollars to cultivate its local economy if that is the goal?

I am the CEO of a mid-sized, private company. I need our website updated. Should I be required to put out an RFP to source the work to the lowest bidder? By your logic, if I don't, aren't I "shielding" my internal staff from competition?

> Why should Portland not use those tax dollars to cultivate its local economy if that is the goal?

The goal is a noble thing, but good intentions are not enough. "Sheltered workshop" policies lead either to feeble industries or rent-seeking or both.

According to the article, the purpose of the 'dogfooding' is not providing a long term subsidy, but rather "to serve as a proving ground for the technology and a reference customer."

YC provides its portfolio companies with a direct financial subsidy at a time when they are not yet able to stand on their own, and gets other YC connected companies to use their products and serve as reference customers. Is YC "enfeebling" its startups?

YC (or any other commercial funding source) does not have a political incentive to keep funding failed or failing companies.

private

There's the rub.

How so?

What your company does with its own capital is your company's business. What the mayor does with the city's taxes is everyone's business. Picking winners and losers on any grounds other than competitiveness isn't in the taxpayers' interest... or if it is, it needs to be very clearly justified.

What a company does with its capital is its investors and stakeholders business, and the CEO is accountable to them for same. What a city does with its capital is its citizens business (not "everyone's") and the mayor is accountable to them for same.

You're assuming that the citizens of Portland want local government to exclude source/location from consideration as a factor when purchasing software services, but do you have any data to support that? (Or else you're simply assuming you know what is in their best interest better than they do which seems overly paternalistic.) From the limited amount I know about Portland, I would strongly expect the opposite to be true.

> What a city does with its capital is its citizens business (not "everyone's") and the mayor is accountable to them for same.

Has Portland managed to avoid the "city money goes to insiders" problem? If not, why won't this be more of the same?

Yeah, this article really doesn't mention too many hard and fast promises but I am optimistic about the Portland seed fund. I got to talk to the two fund managers in charge and they seem to have the right idea about how to bet their chips. We'll see in another month or two if I'm right.

By the way, I didn't know that Josh Friedman wanted to be in charge of the Portland Seed Fund. I thought I heard that the whole thing was originally his idea but I could be wrong. Either way, the fund would best be managed by a hands-on Paul Graham type and Josh is probably as good of a fit as we can get out here.

It was and you are right he should have been, but it was basically pulled away.

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