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Comment by accountoftheday | Hacker News Reader

A more important factor compared with density is, in my view, whether startups are the main game in town. This determines what kind of talent you can attract.

In London you are competing with cash flow oriented industries that will set expectations for the compensation mix, so you are in practice left with somewhat marginal people and not the best. This crowding out effect, compounded by the relatively small exits produced in the UK and an inferior work ethic compared to the US, explains why both founders and employees are less good on average than in some other startup hubs.

For the UK startup scene to really succeed we basically need to destroy the banks and agencies.

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Startups the main game in town; yup, it's a good point, and in Paul's essay he says that Silicon Valley is probably the only place where doing a startup is considered normal. In London it's absolutely not! London has a low density, but still in absolute terms the 3rd largest (by SD subscriber metrics) startup cluster in the world. The fact that startups are not the only game in town is both a positive and a negative. In Silicon Valley there is somewhat of an echo-chamber, and there really isn't anything but tech. London on the other hand is a huge city, the most multicultural on the planet, and can lay claim to being the centre of a number of important industries, including finance, media, music, fashion, etc. If you are doing a startup in any of those sectors Silicon Valley is probably not the most appropriate place to be.

I think salaries for non-contract software engineers outside of finance in London aren't terribly impressive; and not everybody wants to work in finance (or in particular, work with the kind of people who work in finance). Salaries are even worse in the Reading / Thames valley region.

For the UK startup scene to really succeed ..... how about if people located their startups in places where people can actually afford housing costs ? such as - Sheffield, Leeds, Birmingham, Nottingham, Newcastle etc .

One can't create beautiful things in ugly places.

I completely disagree with this, simply because there is already a fantastic and large hub in London. There's hundreds of startups here already and proximity to VCs, in one of the world's best cities. It makes a lot more sense to build on something that's already strong, and make it stronger.

I think one of the smartest things this Government has done is to recognise that and ignore calls from people outside London to create something elsewhere. But yes, London is frigging expensive. That said, you can live close to, but outside London and it's no more expensive than the other places you mention.

I acknowledge London is in many ways a fantastic place to live and grow a business. Its great for the UK if we can have a growing startup hub based in London. However, while many startups will flourish in London, so many others would be completely dead in the water if they tried to grow while facing London costs. Living just outside London is surely more costly than living in a comparable area of a city further north, when you take into account a rail season ticket? Also, commuting times get silly. There's loads of talent scattered across the UK. Whats the point of trying to get that talent to move somewhere where everyone else already wants to live, and quality of life in many ways is poor as result? Silicon Valley is different because they actually pay enough for people to live there. Maybe that's the answer - startups need to start paying £70k to developers in Shoreditch when the same person would have been happier being paid £20k to live in Derby? Thanks for the response though- its interesting to debate these things. :)

Re: your comment around destroying agencies, I disagree inasmuch as believing the forward thinking agencies are/will actually spawn their own IP divisions, and thus feed into the startup scene in the future.

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