4 ms·

Global Venture Capital Distribution

23 points by worldvoyageur 11y ago

financedfuture 11y ago
Anyone in finance that is not ignorant or malicious can see how problematic this is. American, SV and NYC "entrepreneurship" are mislead by the idea of American exceptionalism. These are a consequence of EXTREME centralization of global investable capital in select networks. Had it been deployed evenly, you'd see unimaginably terrific ventures across the world.
sharemywin 11y ago
That article is so arrogant sounding. Of course most of the funding is coming out of SV. Because most VC won't fund anything that isn't in SV or maybe NY. If your from SV they'll fund dog butt social flipper app but sorry I get that your company has revenue and makes a profit it just doesn't meet our funding criteria. I suppose the rest of the IT departments and universities around the world are run by a bunch of nose picking hill-billies. With out the sophisticat-un of them there city folk.
- seibelj 11y ago
  Start with the premise that the single most important factor that determines startup success is hiring quality talent, specifically engineers and scientists. High quality engineers and scientists are currently a small percentage of the entire world's population. They are attracted to areas where they can find jobs, and usually stick around universities. Going with that premise, would you rather start your company in Oklahoma City or Boston? And if you are an investor, would you rather invest in a tech startup in Oklahoma City or Boston? Finally, as an engineer, I highly value the quality of the area I live. There is literally nothing that could make me move to sprawling city like Oklahoma City, Kansas City, Atlanta, Houston, Phoenix, Detroit, etc. Nothing short of an environmental or man made disaster that made all highly desirable, walkable, densely packed cities unlivable. And so it is with many people, I'm sure.
  - financedfuture 11y ago
    > would you rather invest in a tech startup in Oklahoma City or Boston? If I'm smart, Oklahoma. Lower valuation, rent, salaries and less competition. True that the team wouldn't be competitive young engineers that only live in cities like NYC or SF, but that's probably a good thing.
    - seibelj 11y ago
      Have you ever actually lived in OKC? It is an awful quality of life for many reasons. I highly recommend not living there. If investing is only about rent and salaries, you may as well hire in Sub-Saharan Africa. Lots of tech talent lives there, I'm sure.
      - sharemywin 11y ago
        Investing isn't about only rent and salaries its about capital to grow. I would also say that investing in a bunch of super risk takers can work but could also leave you with a bunch of unicorns you can't dump off to the public.
      - financedfuture 11y ago
        I have never lived in OKC and simply used to make a point, as did the parent comment. Take Iowa, South Dakota, Utah, Texas then. If you are a senior software engineer with a family, SF or NYC wouldn't be your top choice.
    - sharemywin 11y ago
      A lot of the top engineering schools in the country are state universities all over. All these engineers leave to go to CA doubt it. http://grad-schools.usnews.rankingsandreviews.com/best-graduate-schools/top-engineering-schools/eng-rankings/page+2 http://grad-schools.usnews.rankingsandreviews.com/best-gradu...
      - sharemywin 11y ago
        Still pretty american centric. Obviously, there are great engineers all over the world.
- financedfuture 11y ago
  You raised a fair point, but filled it with unnecessary rage and derogation.
  - sharemywin 11y ago
    I apologize I've always had a flair for the dramatic.
- Riod 11y ago
  VCs don't fund outside of clusters because early stage private investing is very different from public market investing. There's a reason why Buffett can live in Omaha and be the best investor of all time. Contrast this with embryo stage companies where they really are investing in the team. They don't feel comfortable when the team is far away. Not to say this is right but it's due to human nature being what it is.
npalli 11y ago
The underlying data is from 2012, pretty sure it is wrong for 2015. Asia (China, India, SE Asia) have seen huge investments in the last few years (post 2012).
zekevermillion 11y ago
part of this is definition -- what is "venture funding" -- b/c if you simply count any type of private finance I think you'd find it is more of a continuous distribution (if still coastally-weighted). it's fair to say VC is mostly SV or NY, but I think that says more about how small the world of "venture capital" is compared to the larger world of private finance. this is not necessarily about where innovation happens, and certainly not about where economic output happens.

23 points by worldvoyageur 11y ago

Anyone in finance that is not ignorant or malicious can see how problematic this is. American, SV and NYC "entrepreneurship" are mislead by the idea of American exceptionalism. These are a consequence of EXTREME centralization of global investable capital in select networks. Had it been deployed evenly, you'd see unimaginably terrific ventures across the world.

sharemywin 11y ago

That article is so arrogant sounding. Of course most of the funding is coming out of SV. Because most VC won't fund anything that isn't in SV or maybe NY. If your from SV they'll fund dog butt social flipper app but sorry I get that your company has revenue and makes a profit it just doesn't meet our funding criteria. I suppose the rest of the IT departments and universities around the world are run by a bunch of nose picking hill-billies. With out the sophisticat-un of them there city folk.

seibelj 11y ago
Start with the premise that the single most important factor that determines startup success is hiring quality talent, specifically engineers and scientists. High quality engineers and scientists are currently a small percentage of the entire world's population. They are attracted to areas where they can find jobs, and usually stick around universities. Going with that premise, would you rather start your company in Oklahoma City or Boston? And if you are an investor, would you rather invest in a tech startup in Oklahoma City or Boston? Finally, as an engineer, I highly value the quality of the area I live. There is literally nothing that could make me move to sprawling city like Oklahoma City, Kansas City, Atlanta, Houston, Phoenix, Detroit, etc. Nothing short of an environmental or man made disaster that made all highly desirable, walkable, densely packed cities unlivable. And so it is with many people, I'm sure.
- financedfuture 11y ago
  > would you rather invest in a tech startup in Oklahoma City or Boston? If I'm smart, Oklahoma. Lower valuation, rent, salaries and less competition. True that the team wouldn't be competitive young engineers that only live in cities like NYC or SF, but that's probably a good thing.
  - seibelj 11y ago
    Have you ever actually lived in OKC? It is an awful quality of life for many reasons. I highly recommend not living there. If investing is only about rent and salaries, you may as well hire in Sub-Saharan Africa. Lots of tech talent lives there, I'm sure.
    - sharemywin 11y ago
      Investing isn't about only rent and salaries its about capital to grow. I would also say that investing in a bunch of super risk takers can work but could also leave you with a bunch of unicorns you can't dump off to the public.
    - financedfuture 11y ago
      I have never lived in OKC and simply used to make a point, as did the parent comment. Take Iowa, South Dakota, Utah, Texas then. If you are a senior software engineer with a family, SF or NYC wouldn't be your top choice.
  - sharemywin 11y ago
    A lot of the top engineering schools in the country are state universities all over. All these engineers leave to go to CA doubt it. http://grad-schools.usnews.rankingsandreviews.com/best-graduate-schools/top-engineering-schools/eng-rankings/page+2 http://grad-schools.usnews.rankingsandreviews.com/best-gradu...
    - sharemywin 11y ago
      Still pretty american centric. Obviously, there are great engineers all over the world.
financedfuture 11y ago
You raised a fair point, but filled it with unnecessary rage and derogation.
- sharemywin 11y ago
  I apologize I've always had a flair for the dramatic.
Riod 11y ago
VCs don't fund outside of clusters because early stage private investing is very different from public market investing. There's a reason why Buffett can live in Omaha and be the best investor of all time. Contrast this with embryo stage companies where they really are investing in the team. They don't feel comfortable when the team is far away. Not to say this is right but it's due to human nature being what it is.

npalli 11y ago

The underlying data is from 2012, pretty sure it is wrong for 2015. Asia (China, India, SE Asia) have seen huge investments in the last few years (post 2012).

zekevermillion 11y ago

part of this is definition -- what is "venture funding" -- b/c if you simply count any type of private finance I think you'd find it is more of a continuous distribution (if still coastally-weighted). it's fair to say VC is mostly SV or NY, but I think that says more about how small the world of "venture capital" is compared to the larger world of private finance. this is not necessarily about where innovation happens, and certainly not about where economic output happens.