As reported on TechCrunch.
by Danny Crichton
There are many benefits to living overseas, but among the most valuable is the ability to dislocate yourself from your timeworn surroundings. The typical cadence of our daily behaviors – driving down 280 every morning or getting a burger at SuperDuper before closing – suddenly and irrevocably disappear, and our minds suddenly become more active in seeking the stability of the regular.
That awareness extends to analyzing our previous environment, particularly under the questioning of others who have never lived such a life. This was my experience last week, when I discussed life in Silicon Valley to an audience of Korean entrepreneurs, many of whom have never experienced a spirited startup ecosystem. Even though they had never visited, all had perspectives on Silicon Valley, some of which were far divergent from the day-to-day reality of working in the Bay Area. Particularly appreciated were discussions of little microcosms of activity that aren’t generally covered in the tech press.
In a nutshell, a selfie is needed, or maybe a series of them to give a richer perspective of the region. Given that I am a writer, these selfies are necessarily textual, but hopefully elicit a similar effect: a portrait into the world from my hand extended. Each of these three, about investors, housing, and location, are inspired from actual questions I received last week.
The Investors
Silicon Valley has the most founder-focused investors in the world. I find this to be constantly reinforced, both after meeting my investing friends in the Bay Area, and in interacting with investors from the rest of the world. While there is definitely variability in the venture capitalists along Sand Hill Road, the worst offenders have been mostly flushed out of the system due to the increasing competition in startup investing and better information networks among entrepreneurs.
Since Silicon Valley has gone through multiple iterations in the evolution of the Internet, an ample number of VCs have personal experience with building companies, and many of them have an engineering or product management background. This tends to mean that they care about very different characteristics than VCs in other countries: user experience and product quality is exceptionally important, and business potential can rank over proven business models.
One question that came up was how to demonstrate commitment to a company. Investors here in Korea, but presumably in other nascent startup markets, often ask founders how much of their personal wealth they put in the enterprise. Presumably, this is due to a lower standard of trust, since in Silicon Valley, we take it on faith that founders want to see their visions become reality. Investors will generally check that the salaries for founders are in line with industry norms, but a personal investment is not required.
If there is a point of dissent here, it is over the level of groupthink in Silicon Valley. Due to the smaller size of venture in much of the rest of the world, VCs are often quite conservative, but ultimately are responsible for making their own decisions since there is no one else to turn to for counsel. The same cannot be said for Silicon Valley, where the best way to fundraise is to get as many investors interested in your business simultaneously.
Housing
Many of the entrepreneurs I talked to hoped to “go global” and one day move to the Bay Area with their business. It is the world’s leading technology ecosystem, and of course, San Francisco is one of the most photogenic cities in the world. Among the first tasks a newcomer will likely face will be securing a residence, a task that can be surprisingly daunting given the limited supply of new rentals on the market.
Yet, despite the image presented in the media of an extremely expensive housing market, young technologists are not challenged to pay the rent in San Francisco or the Bay Area. Average pay for engineers runs up to the the upper five digits or lower six digits for entry-level positions at major technology companies (lower at pre-Series A startups), and only increases from there. The ratio of rent to income is not so dissimilar from Washington, D.C., or New York City, other cities with large numbers of aspiring young professionals. Like in these other cities, the compromise most commonly accepted here is to share a place with roommates.
Interestingly, entrepreneurs who immigrate to the United States are often much older than the prototypical San Francisco founder. Moving to areas in the South Bay like Palo Alto or Mountain View, or to areas in the East Bay are much more likely for founders with families. Prices are high, especially compared to prices in much of the rest of the world, so renting might be the only viable option initially. But, you will have excellent company in your neighbors, many of whom will share your aspirations.
The Location
Silicon Valley is not a place. It does not exist. This has been mentioned ad nauseam, but even still, the poster advertising my event had a road sign with an arrow pointing to “Silicon Valley.” It may have been somewhat true a few decades ago when the semiconductor industry was concentrated between Mountain View and San Jose, but the number of startups in San Francisco and even Oakland means that the term has little physical meaning anymore.
The breadth of the region means that commutes between points can be enormously long. San Francisco to Google, Apple and LinkedIn, for instance, can add up to two hours one way, which is why many companies offer their employees free shuttles to move through the region. For those outside such companies, commutes on public transportation or by car can be harrowing to say the least. This is a sore point for many residents, and is the reality of the day-to-day life of the region.
One secret element of Silicon Valley’s success that is sometimes overlooked is its enviable location within California. People always talk about the weather, but the number of sites for environmental exploration are excellent. There is almost nowhere else in the world that simultaneously offers the beaches of Santa Cruz, the skiing of Lake Tahoe, the wines of Napa and Monterrey, the natural beauty of Point Reyes and Big Sur. The physical endowment near to the region is simply astounding.
Conclusion
Finding the perfect selfie of Silicon Valley is probably a fool’s errand, but fighting the misperceptions of the region are not. Even people who have lived here for years can forget some of the most enduring qualities that make this region the center of technology in the United States. It is certainly not a paradise, but it can be remarkably refreshing in its openness in contrast to tech capitals in other areas of the world.