austin entrepreneur

Why I Don’t Want to Be in Silicon Valley

Posted in Uncategorized by efalcao on October 12, 2007

The top talent may be in Silicon Valley, but you’re living in a bubble

The majority of today’s startups serve obscure purposes that average people don’t care about. I’m tired about reading about one-off, gimmicky AJAX re-hashes. How many twitter-alikes and online data storage startups does the world need?

If there is so much talent in Silicon Valley, why are so many of the ideas so awful? I think the community breeds the culture of crap-shoot, quick-flip businesses. Some do pay off, but where is the true value in the majority of these companies? Evenlevel failed, but it was a novel application of technology to a relatively untouched sector and our goal was to save consumers lots of money on their vehicle purchases.

Being outside of the regional startup bubble will help to keep my ideas grounded in reality. A good example is Vidoop with their secure image grid. I really feel like they thought up something truly new and I wish them all the best. Where are they located? Tulsa, Oklahoma. It’s companies like Vidoop that keep the overall bubble from bursting.

There are plenty of rich people here, too

You need money for startups. Austin, TX has money. Maybe it doesn’t flow as freely and there isn’t as much of it, but is that really a bad thing? Startup Darwinism.

California is expensive

I am a product of Southern California. Born and raised, lived there for 22 years. My huge Portuguese family lives there and I miss them a lot, but I’ll probably never move back. I could move to Silicon Valley and probably do really well, possibly doubling my salary. Too bad my quality of life would drop considerably.

First off, the cost of doing business is a lot lower in a place like Austin, TX. Lower rents, lower salaries, lower taxes, lower costs to bootstrap.

I feel like if you have a good home and your finances aren’t causing you to spit out your $4.00 mocha as you contemplate $3.80 gas prices, you are a lot better off when it comes to your venture. Unstressed, happy employees and founders coupled with longer financial runways lead to better companies.

Bottom line

Overall, I am very hopeful that Austin, TX will become a bit more of a software and consumer internet town. You’re already seeing some players in Austin: uShip (my former employer), pluck, thoof, spiceworks, etc.


One Response

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  1. autoventures said, on October 12, 2007 at 7:53 pm

    I think the startup environment obeys power laws/pareto distributions. Startup hubs continue to grow because they are hubs, pulling in more talent because the money is already there. The money goes there because the talent is there.

    San Jose Mercury News has an article about new alt energy companies building factories in the valley for those reasons:

    And, hell, even Paul Graham said it:

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