Ask HN: Bootstrapped founder. Does it make sense to move out of SF for a while?

I am bootstrapped founder who built a B2B product that lives in the bay area.

I think your intuition is spot on, that living in SF is probably not the best way to save $$. That said, a few thoughts.

1) I'd recommend going somewhere where you can get coffee with your customers, so if you are picking a new location, being able to in person meet up with folks who are using your product and love it ... especially in the early days ... can make a difference between giving up on your dream and keeping going.

2) You can live cheaply in the bay area, but it's kinda of crazy. We did it with about ~30-50K - ignoring opportunity cost - 4 cofounders, no car, and more or less shopping at CostCo until we made enough $$ to pay ourselves anything. Rents have gone up, but I think it's likely still possible to get something off the ground while keeping cost of living low -- probably not living in SF though -- perhaps a suburb, or San Jose.

3) If you do plan on selling to startups, I doubt there are too many places where you'd be able to do as much door-to-door sales as you could in SF.

In short, I'd recommend picking location based on your target customers as #1 priority if your goal is to build a successful business.

If your #1 goal is to not work in tech again, and focus on your own stuff -- there are a lot of other places to live that are far cheaper, think -- a small college town somewhere rural -- you might have a 10-20 year runway if you have 2-5 in the bay area.

Thank you! I'll definitely think on that. Honestly one exciting thing I'm realizing is that my customers could be any business in the 500k to 10m revenue range, which is why I'm having this question about staying in SFBA. At least until I decide to try and chase bigger ones (which might need me to have funding/more capital/people).

We're looking at picking up an entire building in Smalltown, Oregon and commuting to meetings from BC to San Mateo. Glad the country has been farting around instead of building high-speed rail...

Getting out of metropolitan areas to look at old brick buildings reminds me of Hunters Point right before the dotcom boom. Floorspace equals freedom and opportunity, and it's all really cheap if you can plan ahead and swing a hammer.

If you have a product with good metrics and customers, investors no longer care where you're based. They've come to terms with fully-remote companies.

If you do need/want to raise, move to SF for 3-4 months to take meetings and then head elsewhere after the $$ is in the bank.

An actual answer aside, why are you focusing (it seems) on either WA or NV? I'm sure you have your reasons, but if it's a state-tax-rate based reason, it would be a poor choice to optimize for this based on the fact that you will, as a core premise to your decision, have no income.

There are a lot of cheaper places in california you could move to if you just wanted to get away from the COL of SF.

Thanks for reading and asking the question!

Yes you assumed right it is for tax reasons. I have some RSUs and other stocks that I could sell and only worry about the 15% federal.

I don't know what your monthly spend is, but there are income levels where you'll see 0% capital gains at both the state and federal level. Also remember that you'll only pay the tax on the _gains_ (ie, taking your cost basis into account).

Moving out of a state for avoid a low-single-digit tax on _gains only_ seems like it may be an over-optimization, but you'll have to look at your specific situation.

Not sure, but worth checking on this, I thought the tax on RSUs can follow you out of California if they were vested there.

They can and will. California will go after you for them. Happened to a friend who had documented 7 months in another state.

Yeah, didn't think it was that easy.

Keep in mind loosness of terminology...

RSUs are taxable on vesting, and California wants its piece of that, if any of the vesting happened while you were a resident or working in California. But after they vest, they're just stock, and when you sell stock, California considers the capital gains to be sourced to your state of domicile.

If the OP was being loose with terminology, and the 'RSUs' to sell already vested, there's no California tax due on sale if they've moved out of state before the sale.

You haven’t named a single reason to stay.

If you aren’t raising funding, don’t need to hire talent, aren’t benefiting from the cons/talks, and no longer like the vibe, you have already made your decision.

Note: the locals in SF would very much like you to contribute to lower rent demand in SF, and the people where you move are likely to be frustrated by the increased rent demand you bring.

The minuscule effect on the rent market of where you move to/from is not a consideration.

I'll admit I'm asking myself a similar question, about my different US HCOLA city. (And I hope comments don't make me regret candor.)

One reason to stay is familiarity, and knowing that I can at least scrape by here a while longer, including living car-free (but not compete economically with the FAANG outpost workers, for safe and comfortable housing).

Another reason to stay is that -- should scraping-by not work out, or the economy suddenly gets much worse, such as due to geopolitical instability -- the city government has a lot of money and tax base, and I'm guessing currently a better social safety net than much of the US.

Another reason to stay is that my startup might have to pivot, due to how consumers are using LLMs, with nothing obvious (and ethical) to pivot to. But my skillset is sometimes highly valued by highly-paying companies, as well as early startups, and the right carrot to abandon my startup would erase the biggest downsides of staying in my city.

> about my different US HCOLA city. (And I hope comments don't make me regret candor.)

I mean there's only a few of them that standout, so you're already self-selecting to the point where it would be less noticeable to just name the city; rather than make it mysterious+bring attention to it.

Most relevant that it's similarly an HCOLA, in the US, and few reasons to stay.

But naming it seemed a little rude to the place, in that it's negative PR.

A bit like talking online about a relationship difficulty, you wouldn't name your SO.

If the first response was to the effect that people care about the SO's identity, you'd ask yourself whether you're in the wrong discussion group.

> But naming it seemed a little rude to the place, in that it's negative PR.

It's a place, not a person. Anthropomorphizing it doesn't magically bestow it feelings nor shame.

Additionally, the point isn't to shame it. It's that by making it a "puzzle", you're more likely to have people calling it out; rather than if you just named it. If someone saw "Seattle", they'd read it and forget it five seconds later.

The city is very image-conscious.

Communication tip noted, but I suspect any puzzle would be mostly to bikeshedding.

> The city is very image-conscious.

So is Intel. Yet they aren't a conscious, feeling entity. So I don't care if calling them out for Spectre/Meltdown makes them "sad".

Trying not to burn bridges in a city that needs all the bridges it has.

Since you have no roots there, you can pick anywhere in the area you want. Are your meetings with contacts in SF infrequent enough to live somewhere vaguely nearby instead? I imagine half of them are in the South Bay anyway, which iirc is a 2hr+ train ride.

It sounds like your intuition is guiding you in a particular direction and you want confirmation from us it's the right move :) It's probably the right move for you. Only you know. I've been in the bay area, renting, with no roots or attachment for 15 years. I've had a lot of similar feelings. Also working on my own stuff income free and not planning to work for tech companies here. What keeps me here is 1) not having another place I want to be 2) cheap rent ($1800 kitchenless studio) and 3) not being in the city (palo alto). if any of those 3 conditions changed I'd probably be out of california at least for long enough to decide if I want to ever come back here for good.

> cheap rent ($1800 kitchenless studio)

Wow that's not cheap at all!

FWIW: I paid that for an awesome 2-bedroom with dedicated parking right on University Ave about a block from Middlefield 2009-2012. Now that's like half of my mortgage for a house that's about equivalent to the average homes in that neighborhood... But in a different state.

You had me at "wow thats not cheap at all" and then lost me at 2009-2012.

At the time I had a great roommate, so my real cost was about $900. Given the nature of what I was doing, I wasn't going to eat Ramen noodles to chase a bootstrapped pipe dream.

I ended having to go back to work for health insurance. (I had a pre-existing condition and the ACA hadn't kicked in yet.) Otherwise, I would have pushed a few more months.

(I knew my business was a pipe dream walking in, and I knew I was starting it for the wrong reasons. At the time I had some emotional needs that I needed to satisfy, and unfortunately I didn't seek out the right resources to plan what I was doing.)

I live in EU. Just spent four weeks in San Francisco and got back home last Friday. HOLY SHIT. Those few weeks in the eye of the cyclone catapulted my business and network into the future by at least a year or two. The number of new clients I landed, the insights from meeting my current clients and overall tailwind strength exceeded my expectations - by a few orders of magnitude. Sure, the cost of living is high, but if you optimize for growth, it’s almost comically worth it. I’m honestly considering putting my kids in suitcases and figuring out a long-term visa.

(Note: I run a service business with most of my clients being tech startups, so take this with a grain of salt.)

Judging by what you write, I’d leave tomorrow.

What’s your ultimate goal?

Is it to do what’s best for your business?

Or your personal joy & happiness?

(These might not be mutually exclusive, but knowing the priority is important)

If it is based on your business best interest, what kind of business do you want to run (forever being a solo or growing to big size with huge staff)?

(Lastly, unsolicited advice - if you're a solo founder - always be telling people your business. Like mention it here in HN thread. People want to buy from other people they know. They can't if they don't know your business name/url :)

Well, there's always the East Bay! Here in Walnut Creek, rent is "cheap" even by NV standards, the weather's nice and you can still go fundraise in PA/SF if you wish. I can't speak for the tax benefits, but if you have no income, staying in CA might be better. Insurance-wise, also consider how being temporarily low income in CA can qualify you for reasonable coverage.

Rent is not cheap in Walnut Creek. Maybe next door in Concord, but not WC lol

Fraternities in Berkeley rent out rooms for cheap, and they're in a nice area.

Having spent a few years living in a fraternity, I would not recommend doing this.

Once you're 3-4 years out of school, it will feel like living with children.

It felt like living with children even when I was in school, but it was cheap and got the job done. My desk area there was actually quieter than apartments I lived in afterwards.

100% yes -- I say this having moved to only a slightly lower CoL place, another wealthy suburban area in California. But I was still able to trade an SF 1-bedroom bachelor pad for a 4 bedroom house (not fancy brand new construction or anything though) with enough left over to buy a new midsize car with cash. This was 6 years ago.

But anyway your calculus is different not owning a home, but just as favorable. I'd check out the Las Vegas or Phoenix metros, where you could live so much more cheaply. Rural can also be an amazing deal, but you'll have to consider your willingness to possible have a different way of life, as well as availability of good broadband, which shouldn't be underemphasized. Overally you'll save a tremendous amount of money which means more runway for you, or hopefully just doesn't get burned as runway and goes into a house down payment or something a few years from now when mortgage rates may be low.

Best of luck!

I did something similar, but after 18 months I ended up getting a job in the Bay Area.

In your case, if you aren't going to fundraise, then you should run your business where it makes sense to run your business. Do you need to be in the Bay Area because you often have face-to-face meetings with customers or other colleagues? Is there an area that would facilitate that?

For me, I left the Bay Area in 2014. It was nice to be able to afford a house that was on par with a Palo Alto mansion, for the cost of my Redwood City 1-bedroom apartment. I still live in a high cost of living area, but not absurd like the Bay Area. I also still miss CA, especially the job market and the way I could immerse myself into tech, but I've gotten over it.

From everything you've said it sounds very reasonable to move out and cut expenses while focusing on building your product.

One thing you might consider is being close to customers and other entrepreneurs. Lower burn and better taxes are great. If you stay near a large enough market to meet some customers in person and other founders, that is a big bonus. Seattle or Vegas may be good to be close to (driveable) if you are looking at WA or NV.

I think you already know the answer. The only reason I can see staying in SF is if you plan on raising funding.

These days it doesn't matter where you're located, at least if you're within 2-3h timezone offset of the US. Just live where you want to live. If you want to be close to VC -- they're probably here in Montana fly fishing...

100% I would move out of the bay area if I had the means and I was bootstrapping.

I grew up in the East Bay, but I bootstrapped my companies in New Haven, CT and Fresno, CA, both much cheaper to live than the Bay Area.

It happened that my wife was getting her PhD, which is why we moved to those cities, but I commented often that I was grateful that we lived in such low cost of living cities while I was trying to conserve cash and get my companies off the ground.

I run MicroConf, and each year we run a survey and a report called The State of Independent SaaS, where we survey 600 or 700 bootstrapped or mostly bootstrapped SaaS founders. One of the questions we ask is about location.

And unlike venture backed companies, which cluster in a handful of cities, Independent/Bootstrapped SaaS founders are located in more than 340 cities around the world, with the most populated city (London) having only 4% of the population.

You can bootstrap from pretty much anywhere. Personally, in your shoes, I would pick a place with great quality of life and great culture, plus low cost of living. Cities like Minneapolis, Charlotte, Raleigh & Durham, Boulder, etc.

Good luck, you have plenty of runway and I wish you the best on this journey.

Stay near a transport hub so you can connect with your prospects and customers regularly, by travelling. Working along side other founders in the B2B space would be extremely beneficial too.

WA is one of the great states of our union. Not that cheap but no income taxes anyway :) Can't speak to NV but it sure seems hot and dry!

If you don't have kids, why not spend some time in asia? Will double your runway, plus will make you feel free.

Where are your customers located? Wherever its easiest to physically get out to them would be your best bet.

It sounds like the best time to have moved out was 8 years ago. The second best time is now.

Remember when VCs spent years telling us you have to be in Silicon Valley, then they up and moved to Miami during COVID over the course of 6 months and told us it's even better than Silicon Valley?

Having to be there was always untrue.

It seemed true before covid. When I lived there, a ton of special events and spur of the moment meetings just so happened to be a walk or short ride away from me. Nowadays, it still seems better to be there, but all things considered, I've decided not to.

Salt Lake City. Thank me later.

You may be able to take advantage of a relationship with an incubator/accelerator and still bootstrap. These are literally everywhere, and believe it or not, there are competent tech workers, advisors and investors all over the US if you do need support.

Major tech hubs are Boston, NYC, Washington DC, Seattle, SF, LA, San Diego, Dallas, Denver, Austin, Atlanta, Raleigh/Durham, Baltimore-Washington-NoVA, St. Louis, Cleveland-Columbus-Cincinatti, Philadelphia-NJ, Minneapolis, Pittsburgh, and many more... it's a big freakin' high tech country!

Here is a list of 100 incubators/accelerators across the US:

1. Y Combinator (Mountain View, CA) 2. Techstars (Boulder, CO, and multiple locations) 3. 500 Startups (San Francisco, CA) 4. Plug and Play Tech Center (Sunnyvale, CA) 5. AngelPad (San Francisco, CA) 6. MassChallenge (Boston, MA, and multiple locations) 7. Dreamit Ventures (Philadelphia, PA, and multiple locations) 8. Alchemist Accelerator (San Francisco, CA) 9. The Brandery (Cincinnati, OH) 10. Gener8tor (Madison, WI, and multiple locations) 11. Capital Factory (Austin, TX) 12. Amplify.LA (Los Angeles, CA) 13. StartX (Palo Alto, CA) 14. Betaworks (New York, NY) 15. Tech Wildcatters (Dallas, TX) 16. 1776 (Washington, D.C.) 17. The Startup Collaborative (Omaha, NE) 18. Entrepreneurs Roundtable Accelerator (New York, NY) 19. Lighthouse Labs (Richmond, VA) 20. Boomtown Accelerator (Boulder, CO) 21. New Venture Challenge (Chicago, IL) 22. The Yield Lab (St. Louis, MO) 23. Acceleprise (San Francisco, CA, and Washington, D.C.) 24. Jumpstart Foundry (Nashville, TN) 25. Venture Hive (Miami, FL) 26. The Startup Factory (Durham, NC) 27. Arch Grants (St. Louis, MO) 28. The ARK Challenge (Fayetteville, AR) 29. Surge Accelerator (Houston, TX) 30. Cyclotron Road (Berkeley, CA) 31. UpTech (Covington, KY) 32. The Iron Yard (Greenville, SC, and multiple locations) 33. gener8tor (Milwaukee, WI) 34. Rev1 Ventures (Columbus, OH) 35. The Harbor Entrepreneur Center (Charleston, SC) 36. QC FinTech (Charlotte, NC) 37. LaunchPad Huntsville (Huntsville, AL) 38. Health Wildcatters (Dallas, TX) 39. Sixers Innovation Lab (Camden, NJ) 40. FounderTrac (Memphis, TN) 41. Velocity Accelerator (Birmingham, AL) 42. FlashStarts (Cleveland, OH) 43. InNEVator (Reno, NV) 44. Iowa Startup Accelerator (Cedar Rapids, IA) 45. Straight Shot (Omaha, NE) 46. The Idea Village (New Orleans, LA) 47. VentureSpur (Oklahoma City, OK) 48. Boomtown Boulder (Boulder, CO) 49. The Refinery (Westport, CT) 50. AlphaLab (Pittsburgh, PA) 51. Betaspring (Providence, RI) 52. Blue Startups (Honolulu, HI) 53. BoomStartup (Salt Lake City, UT) 54. Capital Innovators (St. Louis, MO) 55. Catalyst Accelerator (Denver, CO) 56. Coinvent (San Francisco, CA) 57. EvoNexus (San Diego, CA) 58. Excelerate Labs (Chicago, IL) 59. Health Box (Chicago, IL) 60. High Alpha (Indianapolis, IN) 61. Homebrew (San Francisco, CA) 62. Ignite Accelerator (Washington, D.C.) 63. Launchpad LA (Los Angeles, CA) 64. Mucker Capital (Santa Monica, CA) 65. OCEAN Accelerator (Cincinnati, OH) 66. Quake Capital (New York, NY) 67. RGA Accelerator (New York, NY) 68. SOSV (Princeton, NJ, and multiple locations) 69. StartCo (Memphis, TN) 70. StartFast (Syracuse, NY) 71. Startup Bootcamp (Miami, FL) 72. Startup Junkie (Fayetteville, AR) 73. Startup Socials (San Francisco, CA) 74. Starta Accelerator (New York, NY) 75. TechNexus (Chicago, IL) 76. The Accelerator (Raleigh-Durham, NC) 77. The Farm Accelerator (Atlanta, GA) 78. The Hatchery (New York, NY) 79. The Startup Factory (Durham, NC) 80. TinySeed (San Diego, CA) 81. Year One Labs (New York, NY) 82. Zero to 510 (Memphis, TN) 83. Accelerprise (San Francisco, CA) 84. Dreamit Health (Philadelphia, PA) 85. Entrepreneurs Roundtable Accelerator (New York, NY) 86. FinTech Innovation Lab (New York, NY) 87. Food-X (New York, NY) 88. Founder Institute (Palo Alto, CA, and multiple locations) 89. Founder.org (San Francisco, CA) 90. Fourthwave (Los Angeles, CA) 91. HAX (San Francisco, CA, and Shenzhen, China) 92. Indie Bio (San Francisco, CA) 93. MergeLane (Boulder, CO) 94. MetaProp (New York, NY) 95. NextGen Venture Partners (Washington, D.C.) 96. Plug and Play (Sunnyvale, CA, and multiple locations) 97. PNP2 (Portland, OR) 98. PowerMoves (New Orleans, LA) 99. Reach (Austin, TX) 100. XRC Labs (New York, NY)

Most major research universities have some type of entrepreneurship program and at least one associated incubator/accelerator.

Principal at TinySeed here, just a quick correction if anyone else finds this — we’re a remote/online accelerator. :)

Thanks! I know about YC of course, but not much about these others.

I'm new to business for sure, I'm hoping I can leverage my decade+ of work experience to build something on my own and then skip straight to Series A.

Personally I have put aside 400k to go towards this business.

Do you think I'm wrong to bet on my own abilities considering I'm a first timer at running my own show, or do you think I should still consider applying to accelerators?

FWIW I did apply to YC and didn't get in.

What's expensive about living in SF these days?

You can fairly easily find a room in a shared house for pretty cheap, and you don't need a car.

I don't really see how moving out of state somewhere where you might rent a place for slightly less but then tack on a car means you save money in any meaningful way.

$4k/mo in rent vs $1200k/mo in rent is more than enough to make up for the expense of having a car (if you move somewhere you need one) and still leave you with an extra $25k/yr in an account somewhere....

I literally said a room in a shared house. no one is spending $4k on a room in SF.

You're not renting an entire apartment for $1200 anywhere livable in a large metro in WA or NV.

Everything costs more in SF besides the rent, especially if you're constrained to shopping (groceries etc) at places you don't need a car for. Though it might not matter as much for a single person living without housemates.