Young Brits in Silicon Valley
theguardian.com
theguardian.com
One of the reasons I started organising the LDN2SFO trips was to expose more Brit entrepreneurs to the collaborative culture in the Bay Area in the hope that they would bring it back to London.
I've seen firsthand a surprisingly large number of startups that make a profit from day one. And a lot of startups that were funded from nonwealthy founders' savings. My impression is that we do stuff on a smaller scale, but it tends to be more reliable.
Of course, if they're the only London startup you've heard of, maybe there's a bias. Crazy ambition can garner a lot of PR, especially when it succeeds. :P
I copuld have picked 3 first level managers from BT at rendom and woould have done a better job
We were lucky to share our office with a YC company when we raised our Series A. I must have bugged one of the founders every day for advice on terms and which partners were cool. But now we're all just scaling like crazy and there isn't that shift up the chain towards new mentors who have gone from e.g. £10m p.a. to £100m p.a. revenue. Those people are rare overall, but concentrated in the Valley.
We were in Royal London House with GoCardless and Smarkets. They were (and probably are still) about 1.5 yrs ahead of us in many ways. We also are lucky to have an early investor who is on the board of Zopa.
Most founders I know who have progressed for a few years have at least one or two founders under their wing informally.
The best way to put it is: In the UK we mostly invest in 1 - n whereas in Silicon Valley they also invest in 0 - 1. After all, it's the birthplace of true capitalism.
See: the hundreds of people who attended Silicon Milkroundabout yesterday
Being involved in the web in the UK is akin to having social leprosy - the only other people who will accept you or even talk to you without peering down their noses at you are other people with leprosy - sorry - other web professionals.
This extends even to investors and VCs, as their view over here is that entrepreneurs/technologists are a necessary evil that you have to deal with as part of the process of making money by magic.
Thers an story that the no2 at BT labs (the place that designed and built colossus) was asked what sort of cars he worked on :-(
My biggest concern with start ups is the work/life balance. Putting in unnecessary hours and producing mediocre results doesn't sound so productive to me. I understand the occasional long night once in a blue moon but if it becomes a weekly or daily thing then you are immediately fall into sleep debt.
Those businesses would never have gotten funding if they were based in London.
We ended up not getting funding, and I had to move on. I second the other comments here on the conservative nature of London investors, the most common comment we heard was "come back when you're making money".
Another problem is that the current bubble (if you want to call it that) seems heavily driven by the tendency of Google and Facebook to engage in enormous acquisitions of otherwise unremarkable or even no-hope businesses. A lot of companies don't seem to have any business plan beyond "get bought". But the big fish want companies down the road so the employees can all relocate to HQ. They don't typically want to acquire companies in other countries unless that company is truly something unique.
But those make up a tiny proportion of business.
I would agree with this if I wasn't seeing entrepreneurs who are breaking the stereotypical British attitude of "sell for £10m, kids to private school, consultancy gig until I'm 50 and retire". We have US-style founders over here who are trying to build amazing things. The venture community hasn't caught up, but I think after one or two larger exits for truly spectacular businesses (forget Zoopla, which is about as innovative as Amazon would be if it helped you check the stock of book stores which you still had to visit), the limited partners in funds will pile on.
> This isn't a problem because it means we're more prudent when it comes to investing hence why we rarely get VC/Angel investment for startups unless they have an already successful business model.
That's changing amongst the top tier of venture investors. Rentify (my business) couldn't process credit cards when we raised from Balderton, and the first board mtg of the year was focused on going for growth uber alles.
I agree that some in the UK lack the natural optimism of the west coast, but there are entrepreneurs here who fit the bill and I think venture will catch up on the whole.
Seed stage is different and I agree that seed investors are a lot more conservative in the UK. But from their perspective, look at the recent explosion of pre-venture startups in the UK, and the relative lack of expertise in discerning which is high potential and which isn't. Risk profile doesn't come into it (on the basis that all early-stage startups are high risk), but rather the seed community in London/UK has a heavy financial services bias, and therefore there's a paucity of expertise or even interest in tech.
> The best way to put it is: In the UK we mostly invest in 1 - n whereas in Silicon Valley they also invest in 0 - 1. After all, it's the birthplace of true capitalism.
I agree with this although I dispute the reasons, and the notion that it will never change.
My suggestion wasn't that we aren't creating successful startups. My suggestions is that RELATIVELY, when compared to Silicon Valley, we are not fostering innovation. Of corse we are breaking through the barrier but we will always be risk averse and when compared to Silicon Valley, we will never reach the same levels of innovation unfortunately.
From just plucking figures from Google we can see that Silicon Roundabout has about 1000-2000 startups whereas Silicon Valley has more than 20,000 which is a ridiculous ratio.
> That's changing amongst the top tier of venture investors. Rentify (my business) couldn't process credit cards when we raised from Balderton, and the first board mtg of the year was focused on going for growth uber alles.
Agreed, I think it is changing but I really don't think it will catch up with SF VC. London is great for go-getters but when you go to SF you can raise money for an app that sends a "Yo". Don't get me wrong, it's not a good thing that you can get investment for the most ridiculous of ideas but i'm just trying to portray how risk averse we are as a population. Or maybe a better way to put it is that we take calculated risks.
> I agree with this although I dispute the reasons, and the notion that it will never change.
My suggestion that it would never change was a mistake. We will, as a population, become risk-prone but we will never compare to Silicon Valley. I think we will always be less likely to invest in 0-1's.
it's pretty stupid how these ridiculous, unfounded memes perpetuate on HN. Young founders are best (but there are regular article how empirically they are worse), SV is the only place that has innovation (but clearly aren't).
The funny one I read a year or two ago was that no EU startup had ever sold for $100mill, which was utter nonsense that 5 secs of googling proved wrong, but was being repeated by various SV journalists.
I don't think that's what askinakhan is saying. He/she is basically saying that there is way too much Venture capital in the valley, which basically means that a lot of ideas get funded, even if a majority of them are crazy ones. This lack of capital splurge in the UK makes it harder for startups there, so they have to be more careful...and this is what he/she is saying might lead to lesser innovation.
UK has a very poor history of management culture as well. This is what sunk a lot of the old national companies and hangs around the privatised sector like a bad smell.
After all, it's the birthplace of true capitalism
I can't tell whether you're referring to UK or SF here, although surely that descriptor could only apply to the UK or Italy.
While the BoE appears to have won, as it still exists and the Land Bank does not, the mindset of the nation has been, and is still, Tory to the heart.
Oh, and land/property is a bubble, unless you're hedging on infinite growth of a fixed asset based on demand growth - which is daft, particularly if you're in the same breath opposing immigration and social mobility.
This is what's wrong with media today...