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Why entrepreneurs are leaving the Bay Area for their next startup (axios.com)
187 points by rafaelc 41 days ago | hide | past | web | favorite | 155 comments



This is the key part of this article (emphasis mine):

> This kind of story is often framed as a tug of war between Silicon Valley and the rest of the country. But Silicon Valley isn't going any where, and for every startup or founder who leaves the Bay Area, someone else graduates from Stanford or wants to move here. This is about tech becoming a bigger part of the overall economy.


That does seem to be the crux of the article, but I find it very unsatisfying without data. It's extremely improbable that it is exactly 1 person leaving to 1 person graduating from Stanford or wanting to come. So what is the actual trend? This article doesn't know.


In the absence of housing construction & vacancies, it's probably pretty close to 1 person leaving to 1 person arriving. The limiting factor in the Bay Area is usually housing; if there were really a net outmigration, you'd see vacancies and a drop in rents. If there were a large net inmigration, you'd see new construction (which you do to some extent, but not a lot).

There's probably a mild net inflow that's accounted for by new construction, people doubling up in houses that used to be single-family, and homelessness. The continued rise in housing prices seems to indicate a large latent demand, i.e. many more people want to come or want to stay but are discouraged because they can't get housing at reasonable prices.


I think the housing market indicates a net inflow of engineer types:

(1) There are actually still some low income people living in the Bay Area. For example even in Mt View (home of Google), there are some low income areas. Other cities have them too. The low income people are continuously being displaced by higher earning engineer types. This is reflected in rising rents.

(2) It varies by city, but there is some new construction. Last year, SF issued 6 building permits per 1000 residents, while San Jose issued a little under 3 [1]. Some other cities in the area, like Mt View, Sunnyvale, Fremont, are fairly pro-deveopment.

[1] https://lh3.googleusercontent.com/-q6CqiDf9FL8/XINJI7vxJ0I/A...


No one is asking whether the overall population of the Bay Area is holding steady. They're asking whether the number of entrepreneurs is holding steady.

You don't need new construction for a Facebook developer-drone to move out of the Bay Area and an entrepreneur from Kansas to move into their apartment.

So there's no reason to assume is is anywhere close to 1 entrepreneur leaving for each 1 arriving. And we're back at the original point: without any numbers who knows what is actually happening?

What's more, even small differences become big when you compound them across the total population and several years. Say the ratio is 1.02 arriving for each entrepreneur leaving. And 1,000 leave every year. After just five years you've got 40 new companies. Many cities would kill to have 40 new companies founded (relative to their baseline formation rate).


It is hard, if not impossible, to say. What I think one could say is that these things doesn't generally happen in the way people think. Since there is generally a lot of inertia that prevents people from seeing what is going on. People expects shifts, but it is usually more similar to leaving things on the table. Because this is hard to figure out, it is therefor instead more important to you make these decisions for good reasons. And that what I think is the real problem for the Bay Area (and other regions in a similar position). That you end up losing a lot of potential for no good reason.


Ah, If I had a dollar for every time a post like this shows up on HN, I'd be a millionaire. It's either this, or some personal anecdote of how some founder took his startup to Austin, Detroit, Nashville, Seattle .. < insert gentrifying city here > and they are kicking butt.

Last I checked, San Francisco alone accounted for 25% of the V.C Money and San Francisco + Silicon Valley accounts for over 45% of V.C. Money.

Source: https://www.citylab.com/life/2018/03/the-extreme-geographic-...

> The Bay Area—that is, San Francisco and Silicon Valley—currently accounts for nearly 45 percent of total venture capital investment in the entire United States

and there is no tug of war.

>This kind of story is often framed as a tug of war between Silicon Valley and the rest of the country

Write all you want, but if you are looking for funding (which most entrepreneurs are), then San Francisco and Silicon Valley is still the place to be at.


I don't think it's a matter of "SF dying for startups" as much as it points out that starting there, and then moving elsewhere when you've moved to the next level, is very viable.

Basically SF is to startups as Nashville is to country musicians or Los Angeles is to actors.


There was an article voted up in HN on how we are in Peak California and Bay Area. And someone pointed out that this narrative has been going on for decades.


Meme: beleaguered Apple / SV


Sure Silicon Valley is great for raising money but it's horrible for running and scaling a business. Why undergo all that overhead? Create a real business in a place you can find talent and sustain. You can always travel or have a presence in SV to raise money. Thoughts?


The landlords without rent control are enjoying this, as are the homeowners moving out. That 45% feels a lot smaller once you realize that your money doesn't go very far.

It's also not all your 45%. You have more competitors for that investment, so you can expect a smaller slice of the pie or a reduced chance at getting some pie.


Well said.


SV isn't the best fit for a lot of startups. It really shouldn't be the default location for all startups especially since there are different options that offer different things (NYC, Denver/Boulder, Austin etc).

The Bay Area has 3 things that set it apart from anywhere else and startups that really need this have no other real choice:

Investors who are willing to invest super early

Lots of top tier engineers

An extremely optimistic culture

Investors- Our startup did fundraising on both east/west coast. Valuations, investor quality and potential help was relatively the same, but those in the the Bay Area were completely fine in investing in a pre-rev idea. That was, and still is inconceivable outside. A NYC fund flatly told us they will do no investments until we reach 50k MRR. That wasn't a requirement at SV and we got the initial seed funding as a result.

We do something very tech heavy and quite at the forefront in our field. We need really good engineers and most these types of specialists currently are employed at a Google or Facebook etc. In theory they should be super expensive and impossible to dislodge from these tech giants but what I find is that these super smart people get bored after a few years. They know their worth and that there will always be high paying jobs for them, but they can be persuaded to join a startup on a lot lower salary because they get a lot of freedom and ability to make a difference. A lot of the people that complain about expensive demanding engineers in SV are basically a bunch of PMs or salespeople who want a CTO to build a front end app. If you actually have interesting tech, finding engineers at a discount is quite feasible.

The last thing is about culture. It's like the YC interview day. We spent the entire day before and after the interview (and snuck in again the next) because the other teams you meet- the optimism and energy is infectious. It's the same feeling the morning of a marathon where you're worried it's too cold and wet, but the instant you see the crowd, everything feels right.

If you're doing something that counter-intuitive, and changes existing thinking, then culture is essential. Most startups, even in the accelerators, are ops businesses. They utilize tech, but business not tech is their key driver. There's nothing wrong with being that kind of startup, but if that is the case, then the Bay Area isn't a good a fit which is what this article says. Your customers aren't there, it's expensive, and there are other options. But if you do have a early crazy idea that is based around a key piece of tech, the Bay Area is still the best choice by far.


V An extremely optimistic culture Except on HN where people tend to skew quite negative. Lol


I assume a lot of us negative types are not Bay Area (or even CA) based.


Yep.

An optimist: I could make a start-up and become a billionaire, or at least get $million/year at a FAANG.

A pessimist: I'd probably be sharing a studio apartment and eating dry dog food, or maybe even homeless like so many of the people there.

You see it outside of tech too, for example in acting. The optimist sees movie stars getting over $100,000,000 per movie, so they throw all their belongings in a duffel bag and take the next greyhound to Hollywood. The pessimist knows that most actors fail, with many working minimum wage or risking their health to make NSFW movies. Another place is sports, with the optimist focused on top players and the pessimist well-aware that most are lucky to end up as gym teachers.

So the optimist goes to the Bay Area, gambling his life, and the pessimist chooses a more reliable path in life.


The burden of knowledge


it's not just the top tier engineers. It's engineers who are confident enough to take flyers on startups. It also helps they're very confident that if the startup explodes they'll be able to get another job; that requires a density of opportunities and employers who don't mind a previous job that blew up or a short stint or two.


It's not a seed round if you're making $600,000 a year.

You could stop all development, fire every expensive person apart from some basic cheap support staff, and be wildly rich in a couple of years just from that.


> $600,000 a year

> be wildly rich in a couple of years

pick one


What don't you get?

In a couple of years you'd be a millionaire and richer than virtually anyone in the world. And in a few more you'd be a multi-millionaire and richer than virtually any American.

If you want to carry on working for 10 years to try and become a billionaire, which will almost certainly not happen, go for it.


> What don't you get?

No reason to assume I don't get something here. Learn to leave room for your own ignorance and blind spots.

600k/y doesn't make you a millionaire in a year or two, especially in SV, no matter how hard you try. And it certainly doesn't qualify you as "wildly rich".


what is your startup working on?


We have an enterprise product built around our own NLP


On a related topic, I’m wondering what careers are like for CS researchers in industry outside of Silicon Valley but still in the United States. My specialties are in systems software research (e.g., operating systems, distributed systems), machine learning, and databases. Most of the companies that I’m familiar with that do research in these areas are Silicon Valley-based, although there are some obvious options in Seattle (Amazon and Microsoft are headquartered there, and Facebook and Google have offices there). My ideal situation would be a culturally diverse area with a low-to-moderate cost of living. I like Silicon Valley due to its amenities and opportunities, but I could see myself starting a family within the next 3-5 years and I don’t think I’d be able to afford it in Silicon Valley unless I give up research, hit Leetcode really hard, and apply for a FAANG software engineering position.


The compiler folks at Microsoft are first rate and just good people.


Generally the more specific your "requirement" is the more specific you have to get. So if you are looking for something specific you want to (to borrow a YC quote) "do things that doesn't scale". Talk to former faculty, colleagues and other contacts. Manually look up companies who do research or have business in your field. Make diagrams, charts and spreadsheets if you have to. That is how you would find the things that no one would generally advice you to do since they wouldn't know about them because it would be specific to your situation. (I hope that made sense).


I'm heavily considering Tallinn for a tech startup -

It's easy to get residence status (IIRC basically requires a ~$60k investment in a business you are starting) and extremely easy to start a business. You get access to the EU labor/trade markets in a low COL city which already has a decent sized tech and entrepreneurship presence. The government is actively courting you and in general seems very easy to interact with and move forward with - reducing the PM/lawyer overhead of operating a medium sized business in other countries. And if you stay there long enough it's not overly complicated to get EU permanent resident status.

Overall, Tallinn beats SV in almost every way except for two - developer talent/concentration (though it's still pretty good) and local capital.


I’d worry about talent pool being too small (Estonia has a population of only over a million people). It might not be easy to get people from outside to relocate there, as no one else in EU (expect apparently some Finnish people) speaks Estonian, the weather is grim and wages aren’t that enticing. That’s probably why the government is trying very hard to attract foreign startup investors, as otherwise Tallin is at a disadvantage vs say Warsaw.


Yes but Estonia has https://ccdcoe.org/ as well as numerous IT companies and startups already (most famously, Skype, now a Microsoft office). Plus I don't think you would have any issues having an English-speaking software development office.

Honestly Poland's far-right is a big turn off for me and if I were an ethnically Indian/Pakistani/Turkish software engineer I wouldn't want to live there. It also just doesn't seem like as nice of a place to live. Admittedly, I haven't done much research in terms of what I would need to do as a non-EU resident to get temporary residence there though. I would love for my notions to be proven wrong.


I’ve worked with a number of Indian and Arab people in Poland. I’ve never heard them complain, and some have settled here for good. I am sure there is some level of latent racism here, but that’s true of any society.

Regarding tech companies, Poland has Google, Amazon and some pretty good game studios (CDPRed). It is not an innovation hub by any means though and most people just do regular corporate programming (frontend, backend) or maybe some not terribly innovative startups. If you want to create something based on existing tech, Poland will be fine, but if you want to develop new one, you might have trouble finding the people for it (that’s true for 99.9% places in the world though, Tallin included most likely).

As for Poland being a nice place to live - just come to Wroclaw or Krakow for a weekend when you have a chance and see for yourself. IMO there’s very little difference in living in Warsaw vs say London or New York. The air quality is a worse in the winter - on the other hand, there are no drugs/drug dealers on the streets, no homeless people (or very few), no guns/murders and no terrorism.

Regarding the temp visa, sadly I don’t know anything about it.


Hmm, ok, maybe I'll spend a couple days in Warsaw during my trip to Tallinn and Riga. Thanks!


Warsaw isn't especially pleasant as Polish cities go.


I'd suggest asking what is uniquely beneficial about Tallinn that will make your business more likely to succeed. Lots of places are cheap and the two exceptions you identify, talent and capital, are absolutely critical to the success of high-growth tech companies.


Very good point. I am actually visiting Tallinn later this year to try to meet with people in the entrepeneurship scene and learn more about the city.

While you're right that talent and capital are important, it's also true that no place on the planet has more capital and software talent than SV. So you're never going to beat SV measuring only those metrics. The challenge of an entrepeneur who wants to found a startup outside of the Bay area is to pick a location that is beneficial in other ways while not sacrificing too much in terms of capital and talent. I'm not too sure about the local capital in Tallinn (not that you necessarily need to raise money locally) but I do know it has a pretty strong developer community by european standards, maybe in the top 5 in europe. And it also excels in terms of government support for entrepreneurship and, afaik, local cybersecurity talent. So it's not just a cheap place, it's a cheap place that also has basically every other thing that makes founding a software business attractive with the possible exception of capital.


How did you get information about Tallinn specifically and what other cities did you consider in the same category?


I was reading about the best places to be an expat on something like nomadcapitalist.com and Estonia kept coming up due to the ease of immigrating + starting a business there. And I've just done personal research from there. For example https://ccdcoe.org/ is also based there which is a huge draw for software talent.

Other cities I've been considering - Lisbon, Riga, , Bucharest, Berlin, Prague, Dublin. Mostly was just looking for cheap places with developers that are in the EU and not too hard to immigrate to. Prague in particular seems like a pretty big nexus for EU developers and it's pretty inexpensive. There's undoubtedly many other cities that fit well in this category, I just haven't heard of them. But Tallinn punches above its weight in terms of software presence and it's basically the easiest to immigrate to so I focused on that pretty early on in terms of good places to found an EU-based company.


Nomadcapitalist sells residency services. His info is good, but he has an angle and shouldn't be used as a single source of truth. I like Wroclaw (which gives you access to Ukrainian programmers also) and Lisbon myself. Since Portuguese is easier to learn, and I already have people there, it will probably be Lisbon.

There was a decent overview of entrepreneur passport options on here the other week. https://docs.google.com/spreadsheets/d/1wLPGB2BdRxHWbdOXXtKA...

This one was left off the list for some reason (I have a pal who uses this visa, though he's in Ukraine a lot of the time): http://www.czechstartups.org/en/start-up-visa/


Yeah, I'm aware he's a consultant of some kind but from what I can tell it shouldn't be too hard to navigate the process on your own. A lot of what he focuses on are capital gains/taxes which I don't really care about too much.

Thanks for those links, super helpful, didn't know so many countries offered startup-specific visas. In that google doc spreadsheet it's missing some important investor visas (the startup visa for Estonia looks cool but since the investor visa has such low capital requirements, without digging deeper, it still looks like a better deal). And do you know the name of the program you are referencing with Wroclaw? Does Poland have some special program where you can sponsor Ukrainians' work visas there?

Just curious, what about Lisbon is so attractive to you? I know Spanish and can read most basic Portuguese but still was mostly ruling out Portugal due to what I perceived as too-small tech and entrepreneurial communities. Spain and Portugal seem like great places to work on an MVP with a couple other cofounders but I had kind of ruled them out for a place to really launch.


That's right: Poland and Ukraine have a special visa regime (strong historical ties). I dunno what it is called, but you can google it up: http://www.vfsglobal.com/poland/Ukraine/English/how-to-apply...

There's a host more investor visas of various kinds and "if you feel like it" visas. If you're a US national, you can basically stay in most EU countries if you want to. Each one will be a little different, but ultimately you have to work pretty hard to get tossed out of the EU. Some of these visa regimes are informal, like "OK, you seem like a nice guy and you're not going to go on the dole here." This is the kind of info that you WON'T get from concierge residency guys like NomadDude -he's trying to steer people towards things which he actually provides.

Lisbon: I like the food, climate and architecture better than Poland, and I have more friends who live there. Pretty simple, really: people on the ground trumps any information you're going to get on the internets. The projects on my horizons are all fairly high skill (ph.d. in math), low head count projects, and it's a lot easier to convince high skill people to move to Lisbon than Wroclaw or Lviv. There's also a decent nomadconsultant scene which has interesting social aspects. If I needed head count for a Bay Area type startup, I'd probably go straight to Ukraine, as I got people with top connections there. It's a beautiful country, and lots of the talent wants to stay there.


Tallinn's climate pales in comparison - and I wouldn't exactly call SV's climate ideal.

It practically never snows in SV.


That’s a feature, not a bug: we keep our snow in Tahoe, where it belongs!


How far can one get if he speaks English but neither Estonian nor Russian?


The solution to this is remote work. The main benefits of being in the valley are access to investors/capital. This advantage mostly only applies to executives. So have your executives in SV and have everyone else be wherever they want to be that is cheaper and nicer for them.


Depending on the amount of communication needed for being efficient. I work 10+ years in a Rendite First organisation and there are regular times where I think "damn, discussing this over the water cooler, while running into each other, would be more efficient" than a chat exchange or setting up a video/phone conf. Of course on the plus side I have the uninterrupted working hours, where nobody walks in to me and flexible hours to arrange my life and the tendency to not fully separate private and work which easily leads to free overtime ;)


I actually saw an interesting solution to this. I don't remember what company it was, but they had a designated "water cooler time" where they had a video chat up every day that anyone could pop into and talk about whatever they want, business or not. It gave people a chance to have those serendipitous conversations and built team morale.


What I do in my team is dedicate time in regular meetings for "fun talk" which is non work related, but still different from a true informal thing.

What friends of mine are doing is "nearmote" everybody still in a one or two our distance, so you can meet up on relatively short notice and can schedule regular team meetings, but also have benefits of remote.


I'll second this. Turning the camera on 15min in the morning to chat about anything: pressing issues, vacation or home life makes for good digital water cooler time.


"morning" is a relative term, when distributed over continents :)


Maybe we need Houseparty for work?


What a terrible, clickbait headline.

In short (first sentence), tech start-ups are setting up shop in non-SV locations where they can find cheaper rent and more affordable talent. This is a good thing because it means a) physical proximity to funding sources is less important, b) more funding sources are available, c) good talent is everywhere, and d) the trend of tech becoming part of the general economy (dare I say democratized?) continues.


As someone in the hemp business, I have a relatively unique reason. There's no hemp (CBD, non-psychoactive) program in Oregon. You can do cannabis in California but not CBD. I moved everything to Oregon.

It's funny that the cannabis industry in California is actually trying to slow down any regulation allowing THC-free, hemp derived products.


Did the "recent" changes to the farm bill affect this in either the short or long term? Just curious.


Absolutely. Long term I think it's going to open up in many states.


California better stop punishing entrepreneurs with it's heavy tax stick before experiencing disaster in it's tax revenues.

Exodus seems to be accelerating.


This viewpoint doesn't appear to jive with the one being portrayed currently[1], that the exodus is only among the poor/middle-class and that the immigration of the rich and high-earners is actually accelerating.

1: https://www.latimes.com/politics/la-pol-sac-skelton-income-t...


What do you think is going to happen when significant portions of the poor and middle class leave?

Fewer people to pay for California's absurd public sector pensions and expensive government services -> higher taxes on the people remaining.


the exodus is only among the poor/middle-class and that the immigration of the rich and high-earners is actually accelerating.

Is that supposed to make the groupthink better or worse? I suspect worse, as it's reducing the viewpoint diversity, as viewpoint is affected by socioeconomic status and livelihood.


I think the point is that tax isn't driving an exodus of businesses/entrepreneurs as OP suggested. The opposite is true and it's driving out lower income people. Oakland, for example, is growing like SF with 10+ tall buildings going up this year downtown to accommodate tech companies and their employees.


[flagged]


> Please check your reading comprehension.

No need for this kind of comment on here.

Yes. I agree with you. I was backing up what nrb was saying and that gesman was wrong. One effect is reduced diversity.


Yes you're right. It's my reading comprehension error. I reacted to your comment as:

"hellllllooo I think the point is that tax isn't driving an exodus of businesses/entrepreneurs as OP suggested. The opposite is true and it's driving out lower income people."

Which would sound pretty awful and condescending in context. (I imagined the voice of Miss Martian saying this.) However, that's your username, not a part of your comment.


Haha no worries. Enjoy your day.


I've heard the argument that despite the heavy tax burden, it's just treated as another cost of doing business due to all the benefits of being in the Bay Area (depth of talent pool, fantastic network support, oodles and oodles of VC money, etc).


Talk of exodus is certainly accelerating


California is punishing so much, that actual tax revenue, VC funding, GDP, job, salaries are growing exponentially faster than other states.

https://www.pwc.com/us/en/industries/technology/moneytree/ex...


*its


As an engineer in the Bay Area I would recommend most startups to locate themselves outside the bay. Especially if they operate a low margins business. Rent is expensive and so are the employee salaries over here. I have many Bay Area startup recruiters reach out to me with rather interesting projects. However, a quick look at Glassdoor reveals that the liquid portion of the salaries they offer is so low that I would need to live in a trailer to work there.


If only there were trailer parks or other cheaper housing options around here. Fuck NIMBY's.


It's the YIMBY developers that are destroying mobile home parks here, including the two closest to me right now (on El Camino near Poplar, and the former Blue Bonnet complex at Fair Oaks and Evelyn).


If only there were trailer parks or other cheaper housing options around here.

There's one in Milpitas.


There are several large ones in Sunnyvale and San Jose, too. But even mobile homes are expensive in Silicon Valley by the standards of most other places; at this point, $150K would be a steal, and prices approaching $300K aren't uncommon -- and monthly land rental fees in the park can easily be more than the mortgage. (For instance, a listing I just pulled up on Zillow is a reasonable-ish $155K for a 3br/2ba manufactured home in Sunnyvale, for an estimated mortgage of just over $600 a month...and a rental fee of another $1600 a month.)


I wonder why entrepreneurs don't come to Poland to build their product.

Warsaw or Wroclaw in particular are vibrant, tech-oriented cities where life is about 1/4 of SF.

If I had to bet my future on being able to building something with 1M, I would want to get 4 months instead of 1 for the money.

Of course, SF might have better investing ecosystem, but once you got the money development should be done in a more appropriate place to buy yourself more time.


They're probably leaving for home, or for other cities where they have connections. The idea of an entrepreneur taking off from the hottest startup climate in the world to another country, where they don't speak the language, may not have direct access to their target customers, etc... it's just not viable.

I'd love to see a startup culture of note form in places like Warsaw, but it's unrealistic to expect cost of living alone to bring brand-new startups there.


More specifically you need to be unique to gather critical mass. It doesn't just help being cheap, you have to cheap and something else that puts you a head of a lot of other similar places that are also cheap. And it has to be different enough that it is worth the extra effort. It can't just be, say, relatively easy to for example find an apartment, it has to be significantly easier so that it is an actual advantage. There have been a bunch of Swedes moving to Berlin the last 10 years, with SoundCloud being the most prominent example.


The initial seed for a startup culture must be locally derived first.

Looking at places like Austin and Utah (Silicon Slopes), the local scene developed first- now more outside money is coming now that the 'existence proof' that it can be done well in these places has been established.

I think the necessary (but not completely sufficient) ingredients are lots of young CS grads who would like to stick in the area and a strong local entrepreneurial business culture. That will eventually create the base for successful startups and hopefully get a couple unicornish companies to blaze the trail.


> I wonder why entrepreneurs don't come to Poland to build their product.

The answer is that immigration is very difficult. I couldn't find any freelancer or entrepreneur visas for Poland, so it looks like it would be impossible for me to relocate there and work on my own startup.

I'm making it even more difficult for myself, because I would prefer to build a small sustainable business where I don't take any traditional investment or go through an accelerator. I also want to have a fully remote team, so I have no need for a physical office or local employees.

Thailand seems to be the best option for now, and it's not through any government program. I'm actually employed by an agency called Iglu [1], so I have a business visa and work permit. However, I don't have a boss, and I find all of my own freelancing contracts. My startup also hires Iglu for development services, even though I'm the sole developer, so I am technically working for Iglu while building my own product.

I think it's a really great setup, and it makes everything very easy, stable, and legal. But I would really like to find some similar opportunities in other countries.

[1] https://iglu.net


You don't need to have a visa to start a company.

I started one and it takes 5 minutes from a government website.

After that you can stay anywhere in Europe for 6mo./year without a visa, which includes Poland.


Probably because if they are going to move its easier to just move to one of the other areas of the US. I'd assume cross-Atlantic movement would be after all options in the US, then NA were exhausted of which there are plenty and many up-and-coming areas.


What are the long term prospects for freedom of expression there? [1]

As a first generation immigrant I just don't think the opportunities for socio-economic mobility would be present for my (future) kids anywhere but in a liberal democracy.

[1] https://www.theatlantic.com/magazine/archive/2018/10/poland-...


Most statements in this piece are highly debatable or blown out of proportions. Poland gets a lot of bad press under the new government (which sucks IMO, but on the grounds of their mundane incompetence and stupidity - high even for modern democracies - and not because they’re some evil authoritarians) in part because Polish media is mostly controlled by anti-government journalists, who put very heavy spin on reality. And these are the people who the foreign journalists (Spiegel, NYT, Guardian etc) talk to about situation in Poland. IMO, we’re ruled by cynical simpletons, but probably no greater than Trump, Berlusconi, Cameron etc.


The Atlantic seems to be reputable, but extremely biased towards left-wing causes.

Left-wing causes include smearing Poland because of its supposedly right-wing government (some Poles don't agree it's right-wing, actually).


Timezones can be tricky if you need to interface with US stake holders or customers.


tech is one thing but sales is key


I know the reason I'd be scared to go is Poland's relatively high levels of politicized homophobia. There was this, as recently as checks notes earlier today.

https://www.reuters.com/article/us-poland-lgbt/polands-rulin...


Why are you obsessed with that? There are gays everywhere that live normal lives, here, just like in any other European country.

As for your link: what are LGBT rights? It's unconstitutional to treat any citizen differently than the next in any western country, so there is nothing to whine about. LGBT rights are LGBT privileges, and Poland has rightfully decided to not let PC trump common sense. Sorry!


Networking.


[flagged]


That's only a very small percentage of the population that actually graduated from those schools.


Venture capitalists need to be close to the CEO, who in turns needs to be close to the initial team.

The Bay Area is popular because that is where the VCs are.


They don't need to, they want to. There's really no need for it.


How's the internet/infrastructure in Poland?


I'd say very good. Talent very good as well. Have worked for a bunch of years with a team in Krakow, great people.


> buy yourself more time

but, does that extra time result in success? I mean, if it takes 4 times as long, then doing a better job of building a higher quality product is probably a losing strategy.


- laws

- capital

- language

- networking

- talent pool

- weather&climate


1M -> 4 months? o_O


Political climate, for one thing.

(recent anti-LGBT sentiment, anti-refugee/migrant sentiment, anti-EU sentiment and general right/nationalist movement uptick)


Racism is arguably strong in the US and yet founders are not leaving... I don’t think political climate is on average a strong factor in their decision making.


Ehm... There is no more racism in Poland than in any other country.

OP is Pole (from his profile), and some Poles who left the country are bitter about their own country and campaign against it.


I’m a Pole as well. These people you talk about are probably a textbook example of a vocal minority.


Sure, but he's one of them :-)


> Political climate, for one thing. (recent anti-LGBT sentiment, anti-refugee/migrant sentiment, anti-EU sentiment and general right/nationalist movement uptick)

Did you post this to start a flamewar, because you love campaigning against your own country, or just to spread misinformation?

This comment should be flagged.


Poland's recent rightward turn isn't fake news or even really that controversial in terms of "yes, that's a thing that happened/is happening".


GP comment can be backed up with news reports and with quotes of MP/government members. What do you need more?

> because you love campaigning against your own country

Democracy works best when discussion is open.


So, you judge/don't go to a whole country because of what its politicians say?

The USA's president has been saying a lot of questionable things, but I don't see anyone fleeing SF..?


You don't see the mayor of San Francisco being stabbed to death in public for being pro-gay.


You're right, you just see terrorist attacks, school shootings, and in SF in particular rampant crime with homeless people taking shits in the streets everywhere.

I'm just amazed at how much misinformation and exaggeration one can decide to spread.


> campaigning against your own country, or just to spread misinformation

Those were original discussion goal posts. Criticizing Trump or democrats based on facts is neither "campaigning against own country" neither misinformation.

> The USA's president has been saying a lot of questionable things, but I don't see anyone fleeing SF..?

There is more of this: https://www.theregister.co.uk/2017/07/16/trump_travel_ban_se... https://business.financialpost.com/technology/tech-conferenc...


The notion that the Bay Area contains all the wisdom about high-growth, VC-backed success, if true, seems to me like a great opportunity for those who have been successful at it in the Bay Area to consult for those who want to replicate it for the rest of the country.

It may well be more lucrative for those people to stay put and startup again, but there’s certainly a tier of people who are craving adventure and would much more enjoy sharing their blueprint for success with Austin, Boulder, Atlanta, SLC, Portland, on and on.

If I were a big VC firm (and sure, this might be a good reason why I’m not), I’d be forward-deploying my analysts and recruiting a class of EIRs from the flyover states. It’s a new flavor of alpha for VC: sourcing dealflow from the entire US.


For 'big bet' things it might make a lot of sense. I can see why Uber, AirBnB, and especially OpenAI are going to be there.

But for other, slightly niche businesses, wherein you're competing in a vertical/horizontal that may not be specifically tech, it might make sense to be elsewhere.

Fashion heavy, Mining & Materials, Manufacturing, Fintech, Agriculture etc. I suggest it might be ok to be somewhere else.

As a very crude rule of thumb, if you need 'good engineers' but not 'world class engineers' i.e. the problem space is more or less 'domain' and not 'tech' ... well you can get good engineers in a lot of places, and domain knowledge is not inherently in the Valley.


FB group for anyone else considering leaving: https://www.facebook.com/groups/373683909882919/

I can tell you that Miami would definitely like you here, even our Mayor cosigns: https://twitter.com/FrancisSuarez/status/1100425644968738822


A group of SV VCs have moved to Miami and are in the process of building a whole neighborhood called "Magic City" dedicated to startups and entrepreneurship. It's an opportunity zone, so they're using their stock investments "tax free". A city like Miami has had a very hard time creating a startup ecosystem, many have tried and failed, but it's a matter of time for it to happen.

Source: https://magiccitydistrict.com/

Note: what you see in the pictures are not built yet


IDK if those are SV VCs but I applaud their effort nonetheless.


I would love to start a business in Miami but the COL seems pretty high. I feel like it's probably the best place in the world to start a latin america-focused tech company (social networking, streaming, fintech, etc.) and it seems like a great place to live. Does anybody happen to know what kind of companies the VC's there are focused on - could see pure tech plays being outside of their core competencies and thus unlikely to get funded.


I grew up there, I'm a Peruvian immigrant and just don't understand why people think Miami is good for tech. Solid engineers just move to the Bay Area; who wants to keep living in Miami which has such a cultural aversion to education, a major machismo problem, and frequent flooding.

If you want to work with LATAM, hire Latinx engineers in the Bay (there are lots of us) and hire tech people in Argentina, Mexico, Chile, and Brazil. Lots of talented folks in all those places.


I guess the idea would be to recruit people to move to Miami since there isn't a big tech scene there already (I think there is an Oracle office and maybe Univision has an office?). I've only vacationed there but would gladly take my current pay and live there over west coast. The education/machismo problems at least shouldn't affect a business much since you are probably unlikely to run into those hiring tech people, that's more of an out-of-work thing. One of my best friends is from Miami and the main gripe he has is more the conspicuous consumption (often funded by lots of debt) - again, shouldn't be much of a problem.

But, the grass is always greener I suppose. When I've visited I stayed in nicer places (Brickell, Miami Beach) than I could likely afford year round + just generally engaging in more fun activities than working. I do think lots of people like me would be more than willing to take a West-coast level salary to live in Miami instead though, at least for a few years.


IBM also has presence in Miami and a few other places in Florida


I’m the son of a Peruvian immigrant who also grew up here. Things have been changing - FIU runs the largest comp sci program in the SouthEast.

Companies are getting funded & acquired. Engineers are building cool things and meeting regularly. Plus there are plenty of LatAm HQs here.

You should come back & visit, I’d be glad to show you around and introduce you to the people building real companies.


Yes definitely check out startup.miami - it’s a good starting point.

I’m also happy to connect you, just drop me a line.


"it seems like a great place to live"

Great except for all the hurricanes, sweltering heat and high humidity, and cultural wasteland.

Not that SF has much culture compared to world-class cities like NYC, London, Berlin, or Amsterdam, and Silicon Valley is even worse.

California also has earthquakes, so maybe it evens out.


More culture in Miami than San Francisco.


Phoenix area is another option... Scottsdale, Tempe and Chandler in particular are very business friendly. Yes, it's hot as hell for about 3 months out of the year, but AC works, and it's pretty easy to get a remote start option for your car.

Developer pay relative to the greater population and cost of living is also really good compared to a lot of places.


For anyone else looking to move away from the Bay Area, I'm hiring in Jakarta, Indonesia :)

Email me at crystal@go-jek.com

https://docs.google.com/document/d/1aWeK0dReWeufZUN11f2QMoEP...


You should be close to your customers. My cofounders and I coded most of the MVP in the bay because we all happened to be living there, but then we started going to tradeshows and saw that most of our customers were in NYC so we moved east.

If you are doing a startup where you are a B2B tech company that sells to other tech companies, the bay area is great.


> ...one thing there is a lack of outside the Bay Area are the people who really know how to scale a fast-growing tech company

This reinforces the notion that new tech startups don't really need to save money. They need to dominate their niche. They need to scale up fast and become the biggest player first.


there are lots of ways to start a successful business that don't involve millions of dollars of seed money. you don't have to grow into a multinational conglomerate to be a sustainable enterprise, you know. if you have to huge for your business to make sense at all, maybe you just have a stupid idea. statistically, it is more likely that you are wrong than that you are a zuck-level-genius.


> there are lots of ways to start a successful business that don't involve millions of dollars of seed money.

not disagreeing with you, but this article seems to be about the ones that do involve millions of dollars of seed money


Narrative: Startups are moving out of Bay Area Reality: 2018 VC funding: Bay Area = $45bn, Austin = $1.5bn


Seems reasonable but not really a lot of data points in this article to show a real trend. It's just an option piece. Could just as easily point at a lot of startups staying and growing in the Bay Area and write an article saying why Bay Area is still the place to be.


TLDR: cost of living

But leaving for another west coast city is not going to improve things much, housing and cost of living in Los Angeles, Seattle, Portland, etc are also very high when compared to costs elsewhere in the USA.

The midwest and south should be aggressively courting entrepreneurs based on cost of living alone.


We are, but nobody has discovered the silver bullet, if there even is one. Every medium sized city dreams of being the Something Valley.


Eh, go for it?

My place began with a few people out of the local university and an angel investor. There was organic growth and an actual profit. The exit was a company of about 40 people being sold ($36.4 million in 2019 dollars) to a large defense contractor. That's in Melbourne, Florida.

There are several start-ups in the area created by former employees, generally beginning on personal funds.

This also works in Longmont, Colorado. I have a relative who did a couple businesses starting from personal funds. One sold for millions of dollars, and the other is ongoing with decent success.


Indeed, there are scattered start-ups everywhere. The university in my town is a major center for biology research, and has resulted in formation of a number of businesses, some of which have grown to respectable size. We have Epic. I have my own side-business, but not even scalable to a level of interest for a VC.

But still nothing at a level to suggest the tide turning away from the big coastal cities.


[flagged]


You seem to assume SF salaries will be offered in places that are also super cheap?

Do you expect founders and investors to ignore the cost of living reality in Nowheresville just cause?


Sure, if you're young and single and saving aggressively, you can still come out ahead in SF.

But Even at half or 1/3 the salary, you'd still come out ahead in many areas across the country, if you have a family of 4. In SF, it's not just the extreme housing costs, but also the 3K-4K/month day care costs (if you can get it), and all the other COL.



This sentence is telling: "Sure, he lives in a great 3,000 sq.ft house that only costs $500/month."

You've discounted the value of that house.

You forgot that the house might be on more than an acre of land, with a stream and some forest.

Your comparison isn't equivalent at all. Add some land, and suddenly you aren't coming out ahead. You can't even pay your bills.


How can you save when you’re paying $4k a month in rent?


Make $20K/month in salary, bonuses, and stock awards.


Why on earth would the value someone added to a company have anything to do with the cost of living where they live? Either you support remote or you don't but I would not expect different remote salaries based on where that remote employee lives.

I know some companies do this, but I can't imagine it's a practice that will continue once remote work becomes the norm as it makes little sense.


To you an employee it makes no sense.

To an investor it does.

Human history is filled with stories of seeking cheaper labor.

Have you not been following the anxiety over offshoring? Why did all that manufacturing go to China?

Cities in America used to be the centers of manufacturing and then it moved to rural areas. If you research it you might find like I did that cost of living was cheaper in rural areas. And a lot of businesses decided moving to and building a new factory in a rural area, which happens infrequently, and hiring more people who worked for less was cheaper over the long run.

SF is one data point, but folks who were already priced out there are in Seattle and Portland, etc., pricing out others who have to go somewhere.

Maybe the first generation of workers will make bank due to lack of capable workers, but others will join the trend of moving, rural populations of folks capable of this work will grow and work for less.

I don’t have concrete numbers around how soon or how many people will move, because I can’t predict the future, but the general pattern has happened over and over in just 150 yrs.

And the parallels to ancient empires conquering a new land and enslaving the people to grow the wealth of the king or whatever mean the idea goes back further. It only got wrapped in our contemporary language of economics in the last 150-200 years.


Manufacturing and software development are very different though. Any able bodied person can work in a factory. If we're being generous I'd say at most 10% of the population is even capable of writing software. The demand for these people is only going to increase. As we have seen with rising developer salaries, the scarcity of the skill allows some leverage to the employee that other fields lack.

Software development is also unique in that it's one of the few roles that works really well remotely. I'd say most developers are even more productive remote than in the office due to the need to sustain mental focus in a way that's difficult with a lot of distractions.


Don’t get me wrong; I would expect salaries for remote programmers in rural areas to be higher than typical for the area.

But the future is not going to be something like hundreds of thousands a year in a town where average of cost of living is like $30-$40k.

It’s quite possible I am being too cynical. But people spend all day carefully measuring what we should make to insure the balance isn’t too tilted in our favor. I doubt they’re going to miss what seems like an obvious reality to me.


You're right over the long-term, but all market advantages disappear over the long-term. The fact that in 50 years software development will be a commodity skill that anybody can do from anywhere does nothing to ease a labor shortage today. And the remote worker who can competently ship software on demand doesn't care that his kids won't be able to do the same; he can make bank now and use the excess to set them up for the careers that'll be in high demand tomorrow.


What you're proposing is out of touch with reality. Compensation is based on value added, but also based on geography. Bartenders in South Dakota don't make the same as bartenders in San Francisco for a reason, though they add the same value to an establishment.

Most companies would stop hiring remote if they had to pay SF salaries - that's just the fact.


> Bartenders in South Dakota don't make the same as bartenders in San Francisco for a reason, though they add the same value to an establishment.

I bet the drinks in SF cost more so they actually do add more value there. You're talking about on-premise work and I'm talking about remote work. If you have a great dev that starts working remote in NY then moves to Kentucky would you give them a pay cut? Of course not, they'd still be super valuable to the company and you'd want to retain them.


How is cost of a drink related to the value the maker provides?

I will admit you have a point with the NY>Kentucky example. In that situation, the company may pay them the same, but if the company hires two equally talented devs, one in NY and one in Mexico, there will absolutely be a difference in their pay. If the dev in mexico moves to the US, their salary also goes up accordingly.


The companies could be incorporated in remote areas as well, and use the benefits to provide competitive salaries.


Value added doesn't have much to do with it but there are other supply and demand factors at work. Truly remote friendly employers are still the exception so there is still high demand for engineers who are willing to relocate to the Bay Area. Someone not already there who is evaluating job opportunities will be considering a number of factors besides salary: cost of living, disruption of relocating to them and their family, lifestyle, culture, etc. and how they weight these factors will depend on the individual. They will be willing to accept pay lower by whatever it is worth to them to stay where they are.


Value-added actually does depend on where you are: in-person interactions are significantly more valuable than remote ones. Network effects from who you know (which generally depends on where you are) matter. Interactions with creative people work as sounding boards for ideas.

This is precisely why technology companies cluster in hubs - not just SV but Austin, Denver/Boulder, Seattle, etc. and aren't more or less evenly distributed.

That aside, salary is determined by supply and demand, not solely by value-added. Value-added is a factor in labour demand, but it can be totally swamped by other factors.


i dont know why this is being downvoted. There's no reason for every company in the world to pile down into one city where the locals don't even want the growth.

I guess it's not commonly known but SF by population count is only 10% tech. The other 90% is mostly anti-tech. There's even protests against more tech moving into the city and the occassional attempt at anti-tech regulation (no bus laws, no free lunch laws, etc). i think they succeeded with the no bus laws: I know at least one startup that was shut down for providing bus service for workers.


I highly recommend that anybody who loves SF and startup culture stay in the Bay Area. It's best for everybody.


The only reason I am still in SV is because I am stuck on H1B. I think having a better immigration system is a Red president's best bet to finally spite the largest Blue state. You need to bring in talented engineers from world over and let them flood boise, Reno, Austin, Sarasota and Denver. See the Silicon Valley crumble.


H1B is not location specific. You are free to work from anywhere in the US you find employment


It is job specific which means I can not go to Texas and take up ranching or just freelance from Reno.


That would be a terrible way to run a national economy. But perhaps I shouldn't use the speculative tense...




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