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Oh boy, here we go again, another article proclaiming that California is too expensive and you're better off starting your company elsewhere. California has bee
by jarjoura 8y ago
Oh boy, here we go again, another article proclaiming that California is too expensive and you're better off starting your company elsewhere. California has been expensive for a very very long time, decades. Yet, every year, someone gets hopeful that this is it, this is some sign, tech is finally moving on from California. When I moved to California in 2007, startups in Austin were the next big thing. SXSW celebrated a huge number of Austin startups, and then once they grew to a larger size, they all migrated here to California and the scene seemed to evaporate overnight.
The problem these types of articles fail to grasp is that even with paying a tech worker over $200 to 500k a year, that is still an amazing return on investment. Not even considering just the FAANG companies, but all the other ones like LinkedIn and Square, Twitter and DropBox, they're raking in billions a year in revenue. They make so much raw cash, they have stock buybacks and investment arms of their companies that just invest in other things.
There are other tech cities, of course, Seattle being another hub. You don't have to pay as much for your employees and the cost of living is adjusted for that expectation. LA and NYC have a pretty decent cluster of workers as well. The problem is, you can find generalists, but once you start to need specialized engineers or roles, it gets exponentially harder and you end up creating remote offices in the Bay Area to capture that.
I'm not going to defend that it's not exhausting living here. It's hyper-competitive and the politics of "live and let live" create pockets of very seedy places in all the strange areas. Yet, some of the brightest people in the world live here doing some of the most amazing things in the world. It's super easy to find a meetup where, for example, the guest speaker invented Rust, for free, with pizza, on a random Tuesday! Other places around the world have to create these specialized conferences to make it worth their effort.
- HillaryBriss 8y ago> that is still an amazing return on investment. bingo. to first order it's a winner take all game. it doesn't matter how much cash the VCs need to pay to start one of these contraptions. what matters is that the contraption succeeds. if the chance of success is 0.01% in SV, but it's 0.0000001% in Austin, it doesn't matter at all if the costs are 10 times as much in SV. VCs are not starting companies to save cash. they're starting companies to dominate an industry. so they buy the biggest guns and it doesn't matter how much they cost.