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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
by jasonmcalacanis 16y ago
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.
- athst 16y agoThanks. DC is an interesting one, you don't hear it mentioned very often.
- neworbit 16y agoI 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".
- jasonmcalacanis 16y agoat 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).
- neworbit 16y agoSo... 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.