Startups, you don’t need to be in Silicon Valley

He is mischaracterizing Paul Graham's argument. The argument pg makes is that if all other things are held equal, your chances of success are higher in Silicon Valley than they are in other cities, which is not the same thing as saying that Silicon Valley is the only place you can do a startup.

I'm very convinced of Paul Graham's take on this, in that there are positive network effects to locating near people and organizations like yours.

That being said, I agree with the author...but only because I'm starting to think that the toxicity level of SV culture is starting to outweigh its positive network benefits of talent. SV startups are completely overrun by a TechCrunch mentality of hype-machine backed, poorly conceived products...and if you aren't funded you are dead. Some startups may thrive in that culture, but far from all will.

I would argue that you should locate where you get the benefit of colocation of focused talent, rather than colocation of focused intent. In other words, if you are a cruise vacation startup, you need to be in Miami, not Cupertino. And if you are a media startup, you need to be in Los Angeles or New York, not Mountain View.

So he has one data point, therefore generalizes for everyone. That takes away credibility from the article. Sure, you don't need to be in Silicon Valley. All you need is luck :)

I've seen many startups benefit greatly from moving to Silicon Valley (including my own). Sure, you don't need to be in Silicon Valley. However, it does help tremendously for many types of companies.

In some ways I personally think the Valley is a harder place to start a company these days. The competition for talent and sky high real estate prices translate to expensive salaries which entrepreneurs have to pay somehow, and employee loyalty is probably harder to achieve in a place where employees have so many job opportunities vying for their attention. Those factors make it harder to get a company off the ground, and harder to keep it going for the long term, somewhat offsetting the benefit of easier access to capital.

Ryan is already "known" and had a business that was profitable. I'm sure Biz Stone could raise money in Maine. Try being unknown in Orlando and raising money for a pre-revenue startup. YRMV

Also $7 million was raised with an office in Portland, which I'd consider a startup hub.

Yes

It's a contradiction to establish a company that leverages users all around the world and then cram the team into a small geographical area together with similar companies.

"Oh but we want to raise money, financing is there", financing is everywhere.

And you will probably find that you don't need to raise that much money if you relocate somewhere else, since your employees can get a smaller compensation, since they don't have to fight for a place to rent.

Your office costs can be smaller as well

And no, you don't have to get your team together all the time, be creative, it is possible to come up with a product with a remote team. If they can meet a couple of days per week, even better.

Most businesses will succeed based on a variety of metrics, there are environmental factors that help some of those metrics.

Startups are hard - setting up shop in a startup hub helps you succeed at being a startup. There's support and best practices in the air for you at being a startup, which is super super helpful. SF being the largest and most robust of these hubs provides probably the greatest support on this front.

Nevertheless, it is sometimes forgotten that startups often don't exist in a startup vacuum - they interact on a variety of levels with the world and different locations will help them succeed in these other aspects. If your startup deals with publishers, being in the location where all those publishers are helps you immensely. If you deal with fashion being in a fashion hub helps you. If you're schtick is some fancy machine learning thing, maybe you want to set up shop by MIT. Etc.

So while generically being in a startup hub will help most startups more than other locations. Specifically your startup might see greater benefit elsewhere, or not in SF or whatever. And maybe, just maybe, you don't need these environmental boosts so just go wherever the hell you want to live. It's startups, break the rules when you want to - just know what you're giving up and what you're getting in return.

I imagine as time goes on, and remote working becomes increasingly more and more common, that the notion of packing up and moving to a start up hub will become more and more rare. There's always going to be cases where it makes sense to have employees in the office, or a reasonably central hub, but given the majority of work can be handled from a tropical beach or a snow capped mountain it's less relevant.

Agreed about Silicon Valley colocation being unnecessary. I'd go further and argue that imposed colocation anywhere is unnecessary. For over a decade I've worked exclusively on distributed teams which came together only during those times when it was naturally productive to do so. For the majority of the time, team members worked in distributed locations independently.

Consider Joy's Law [1]:

  "No matter who you are, most of the smartest people work for someone else"

Generalizing, I believe:

  "No matter where you are, most of the smartest people are somewhere else."

Face-to-face productivity gains are easily overwhelmed by losses due to having restricted the search for team members unnecessarily. Distributed organizations will win in the future.

[1] http://en.wikipedia.org/wiki/Joy%27s_Law_(management)

Ryan, treehouse is an awesome way to learn technical subjects. It looks like you guys put a tremendous amount of effort into making the quality just superb. I'm curious if your pricing going forward will change with your focus on younger students. I have a little one at home who is really jazzed about the iOS classes, and the price is totally doable but causes a bit of a wince.

Secondly, I have really been wanting to setup a "Computer Club" for young kids in my town, but I don't have an educators training. Just wanted to say that this seems like a perfect fit for filling in the gaps of my knowledge by using your content and get this group up and running.

The plural of anecdote is not data.

I've worked at a startup in Santa Barbara CA, and one in the Bay Area. The reason I push to the Bay is for energy purposes. The inspiration of the startup community really boosted everyones energy up and pumped us up to work harder! It easier to work out with others that are working out rather than doing it alone in your living room.

Depends on what you're doing. If I were starting up something around the oil industry, pretty sure I'd want to be in Houston. (Easy access to Austin talent being a bonus, but that's a tangent)

Just because you don't NEED to be in Silicon Valley to build a successful venture backed start-up doesn't mean your odds of success are not IMPROVED by locating there.

one point the article did not mentioned how often does Ryan travel to the valley (recruiting drive, meeting potential technology partners, etc).

What I am really saying is that if he frequently travels to the valley, or some other tech hub, is his generalisation in this article still valid?