I get asked this question a few times a year so it is time to write a post about some of the most common misconceptions of being in a wrong or right place. It is very true that there are a lot of factors, but let’s explore two, what your potential customers think and what your potential suppliers/employees think.
Your customers won’t really care where you are as far as you have a great product/service.
Think about it for a moment, unless your product or service has a strong correlation to its origin, like Champagne or Tequila, does it matter where it was made? For most people the answer simply is no; for most customers, good quality and price are more important. The point I am trying to make is that unless your product falls on a specific category were location is part of the brand, where you are is not so important.
For many companies, the “where something is made” is just a function of either cost or closeness to raw materials. This two factors will have the greatest impact on location, so let’s expand on that because costs and the sourcing of raw materials are intrinsically intertwined. For example, if you are close to the providers of raw materials then your costs might be less, but the place where you need to deliver your products is far you might need to add the cost to ship your products.
The same hoholdsrue for some services, it might be cheaper to service a customer from an offshore location, but you might incur additional overtime because the service time window is not the same. For many transnational corporations, this is a constant balancing act, as new markets emerge and competitive pressures drive prices down, they must constantly find better ways to extract the cost from the process of manufacturing their products and deliver their services.
The other key ingredient of successful entrepreneurial ecosystems is the ecosystem itself.
While it is true that Silicon Valley has lead the high-tech revolution and as a byproduct created one of the most successful entrepreneurial ecosystems, it is not the only one. There are many thriving entrepreneurial ecosystems in the USA and around the globe. Some exist as byproducts of beneficial economic conditions and other were purposely created to fuel the improvement of economic conditions. There are great examples all over the world, all the way from Chile to Israel, from Miami, Austin, Boulder to Shenzhen China ( The Silicon Valley of Hardware https://www.youtube.com/watch?v=SGJ5cZnoodY )
So you are thinking about going to Silicon Valley in order to start a career and get immersed in high-tech; First of all congratulations, you have chosen one of the most exciting paths I can think of. Entrepreneurship and technology will continue to be areas of incredible growth for many more years. Historically, Silicon Valley has been the place to be surrounded by like-minded people. One does not need to wander too far to find some interesting places to land, for example, Startup Embassy ( http://www.startupembassy.com/ ) is the oldest entrepreneurial residence located in Palo Alto. They provide a soft landing for international tech entrepreneurs they claim to be a community of like-minded founders and provide collaboration, living and workspace. In short, Silicon Valley’s ecosystem does a good job welcoming people (https://youtu.be/r44RKWyfcFw ) but the key point is that there are many other great places too.
So you see, where one should go really depends; like the Cheshire cat in Alice in Wonderland says ( https://www.youtube.com/watch?v=G4fHre-yRPY ) it all depends on what you want to do.
Drop me a line in the comments below, what would you do? Would you pack your bags and head to Silicon Valley, Austin, Boulder, Shenzhen or Miami? If so, tell me why or why not?