November 8, 2016
For many years, entrepreneurs assumed that if they were going to create a successful, tech-based startup, they had to move to Silicon Valley. If this was ever true, it isn’t true anymore. With business incubators, Shark Tank style competitions, and crowdfunding solutions popping up all around the country, entrepreneurs can get their funding from a variety of sources.
With a laptop and an internet connection, hopeful entrepreneurs can connect with like-minded business partners around the world, using tools like Skype and Facetime to connect and share ideas.
Why should you start your company where you are, instead of moving to Silicon Valley?
Cost of Living Is Lower and Quality of Life Is Higher
The Bay Area of California contains some of the most expensive communities in the United States. Yes, there may be a lot of talented people in that area, and if you value face-to-face meetings over all other metrics, then you may want to be in the same city as your employees. But for many entrepreneurs, finding good talent that’s reasonably priced is more important than the ability to take your team out for drinks. The truth is that some of the best and most talented programmers and software experts can’t afford to move to Silicon Valley either. Connect with them online.
Experts Are Everywhere
One of the biggest reasons that moving to Silicon Valley used to be a necessity was the level of expertise that was available there, from experienced business owners to CEOs to banks and angel investors who understood the language of startups.
But as more and more CEOs turn to creating their own personal brand and social media platform, their experience and ideas are available for anyone with an Internet connection to learn from.
If it was ever really required to move to Silicon Valley, that time has passed. More and more communities are developing into technology hubs, realizing the importance of creating smart cities and smart communities, and offering fresh, unique opportunities to people who might not have realized what they could accomplish before this.
VC Firms Might Want Outsiders
While many venture capitalists are located in Silicon Valley, many are now looking aggressively outside of the Bay Area for companies to invest in. According to Jonathan Teo of Binary Capital, companies founded outside the usual tech hubs are more likely to be undervalued, making them a better deal for both himself and the investors he represents.
Other venture capitalists have said they are turning their attention to more complex industries, like healthcare, food service, and education, where software and automation are being embraced more slowly. Companies that can make inroads in these industries have a greater potential at this point than some of the traditional companies these angel investors see in Silicon Valley.
The conventional wisdom is that it’s difficult to achieve big funding rounds outside of the Valley, but while the VCs themselves might be located there, they are clearly open to non-traditional founders who are outside of the standard business locations.
Non-“Flashy” Businesses May Struggle in Silicon Valley
The biggest and fanciest companies in Silicon Valley have a lot “sex appeal,” as they say in the business world. Companies that take a little longer to explain might not be as simple to sell over lunch, however, which can cause entrepreneurs to struggle to find funding in the fast paced world of the Bay Area.
If a business isn’t set to become a unicorn, it may struggle to interest the kind of investors who stay focused on these sorts of companies.
Instead of being dismissed because your business doesn’t fit a particular mold, some companies do better when they choose to stay in their community of origin and work with people who understand their particular needs.
More Community Support
In Los Angeles, it’s said that everyone is an aspiring actor, or is working on a script. In Silicon Valley, everyone has a startup idea. These hopeful entrepreneurs can be so ubiquitous that it’s difficult to rally community support beyond family and friends.
In communities where entrepreneurs can sell the “home-grown business” angle, they may be able to gather support from locals, create more passionate movements, and in general improve their business prospects. In small cities that are building their business-friendly credibility, they may be intensely motivated to help small companies get off the ground and gather significant interest.
If you already live near Silicon Valley, or if you have the extra money necessary to thrive there, moving may be a way to get a leg up in a competitive industry. But if the Valley lifestyle isn’t for you, don’t assume that you’ll never be a successful entrepreneur. Give it a try in your own community.
Did you like this article?
Get more delivered to your inbox just like it!
Sorry about that. Try these articles instead!