

The Trouble with Bubbles (talent, angel & incubators… oh my) - ssclafani
http://calacanis.com/2010/11/18/the-trouble-with-bubbles-talent-angel-incubators-oh-my/

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alain94040
I liked that post from Jason, I found it quite insightful. I just disagree
with the talent part. Yes, it's tough to hire the best in Silicon Valley, but
frankly, moving to Oklahoma will not make it better.

Is there an angel bubble? There is definitely a major uptick. I agree with his
reasoning. Angels have money. Even the stock market is back higher than it was
before the 2008 crash. So cash is available. But for how long?

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thetrumanshow
If there is a talent bubble causing salaries to surge, it must be HIGHLY
localized... say, at the top 3% of talent.

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jasonmcalacanis
Actually, I've been hearing stories of 80-100k out of school for developers.
That would be the high/highest end of salaries in cities like Boston, Austin,
seattle, etc.

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jasonmcalacanis
1\. What did I get right? 2\. What did I get wrong? 3\. What did I miss?

Interested to hear yc folks thoughts on the incubator bubble that the massive
success of YC and TechStars has caused.

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athst
My question from this was, if you shouldn't be in Silicon Valley or NYC and
choose a different city, how does that affect your ability to raise money? And
what does it cost to give up some of the community/cross-pollination effect
that goes on in those major areas?

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jasonmcalacanis
1\. It is much easier to raise money in the Valley than any where else--
certainly. However, based on what I've seen from Open Angel Forum, you can
raise money in Seattle, Boston, Los Angeles and Boulder almost as easily, and
at a similar (maybe -10-25%) valuation.

2\. Los Angeles, Seattle, Austin and Boston specifically have a lot of angels
and not a lot of great companies in my experience.

3\. You will give up some cross-pollination, yes. However, you will experience
less turnover and competition for talent. The best thing an up and coming
startup could do in my mind right now is move to Seattle, DC or Boston....
there are so many amazing developers there who want to work at a kick-ass
startup. If Twitter moved their HQ to Seattle right now they would get a flood
of folks from Amazon, Microsoft, etc. to join them.

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neworbit
I don't see those valuations nor investor traction in Seattle, Boston, or LA.
Not sure I ever have for Seattle and LA.

Part of the reason there is that they aren't in the Valley echo chamber.
Farther you get from home, the less press you get, therefore the fewer people
thinking "what a great company".

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jasonmcalacanis
at the Boston, Seattle and Los Angeles Open Angel Forums we have seen
companies that are slightly less (10-35%) further along than the Valley and
New York City, but that have valuations that are much less (50%).

Folks in those cities are raising $250-500k at $1.5-2m valuations, where in
NYC and the Bay Area/Valley we see $4-6M valuations.

You are correct that those companies get less press.... however, they just
have to be creative and successful and they will get it (RedFin and Groupon
and Gowalla come to mind).

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neworbit
So... if valuation is a big driver/deterrent of angel deals, why don't you
spend the majority of your time chasing deals in those cities or other similar
areas with entrepreneur/tech talent but less angel competition?

Maybe you are - it doesn't come across that way.

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Stevenup7002
"With Twitter, Zynga, Facebook and Google in the ultimate game of one-
upmanship, small startups are simply not going to be able to compete for
talent in the Valley." I disagree, there will always be a sizable handful of
engineers that would rather work in a startup environment than in a big
company like Google or Facebook.

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DanielRibeiro
The following quote reminds me a lot of what pg said in "Why to Start a
Startup in a Bad Economy"

 _Let me repeat that: great startups grow independently of the stock market.

The fact is, the public markets rarely have much effect on a startup at all._

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austinnobody
if i read one more title like this:

    
    
      blah, blah, and blah, oh my!
    

or like this:

    
    
      blah or: How I Learned to Stop blah and Love the blah
    

i'm gonna punch my monitor!

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danilocampos
I'm not sure why you're being voted down. These cliches _are_ awful. Not
clever, not any signaling mechanism that you're a friend of Dorothy or a fan
of Kubrick or anything else. Just awful.

It's enough to prevent me reading the article unless the author has already
banked some serious credibility with past work.

~~~
austinnobody
non-haters gotta hate

