It’s so sad to hear about the brain drain in the UK recently. Geography is Destiny, said the NY Times in February, stupidly.
Sam Sethi writes recently about the need to be big if you’re going to compete over here — though I understand his (and Mike’s) blog is about to do just that. Tom Coates, Ben Metcalfe, Yoz Grahame have/are all going to the States. Peter Nixey of Webkitchen, who has just departed for San Francisco, writes:
Even in less than 24 hours here it’s blindingly incredibly obvious even to Pete, a friend who’s come out travelling with me, that there is no point in hanging around in London to do a startup.
The people, the technical expertise, the price of living and the weather combine to create an atmosphere of potential here you can almost taste in the air. Visiting San Francisco firmly changes the question from being whether one should come here to how to make it happen.
Back in rainy London (note to self: global warming seems to have devalued this cliche), there’s a climate in the air that says you can’t make your startup internet business work in the UK, because the investors won’t allow it to here. That only the US, and particularly the West Coast, and more particularly the Bay Area of San Francisco is receptive to the NEXT BIG THING. I’m more than a little suspicious of that attitude, to be honest. The atmosphere may well be more heightened in the Bay Area, but I really don’t know if that will make a business more likely to succeed. The millions upon millions spent by webvan (not Bay Area, but close) didn’t make it any less of a crackpot idea.
Y-Combinator — Paul Graham and partners’ mini VC fund, based in SF — typically invests $6K per employee in startups. Are you really telling me that can’t be done in the UK? Their attitude is that it doesn’t take money to be a successful company; it takes a great idea: like reddit, for example, which was profitable pretty much from its inception.
Jean Paul Richter said “cheerfulness is the atmosphere in which all things thrive”. That’s probably true and it’s my own interpretation of the idea of SF, some of its reality and its ability to embrace the pottiest of business ideas. Small examples — digg — three rounds of VC funding from companies based in SF and no closer to a profitable business model. Technorati, same story. Plenty of others, same story.
So what happens when they stop laughing?
At least in London, the museums are still free.
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Couldn’t agree more. It’s not where you are but rather who you are and what your idea is that counts. I’ve been to SF many times but take the Bay Area out of the US and I suspect that many US startups struggle to get funding just as they do in the UK.
I would also make the point that if your Web2.0 business is good enough you shouldn’t need startup funding. As long as you have an income the idea and technology will carry your business along regardless.
Vive La UK.
Hi Ian (D),
Thanks for the mention and I’m not quite gone yet — only over here visiting at the moment but definitely trying to figure out the logistics of a move now.
You mentioned funding and early stage funding is more accessible in the States than it is in the UK but it’s only a small part of what makes the place attractive. The real attraction is that there are so many people both doing the same thing and who have alredy done the same thing who you can learn from.
To make an observation on Ian (G)‘s point, it can be the case that the idea and technology will carry you along but sometimes businesses simply take more resources than it’s possible to give them in the evenings alongside a job.
If that happens before you reach liquidity and the business is viable enough that you’re confident it will reach liquidity then funding is a very defensible path to take. Whether the idea/business/app is that good is of course another question altogether ;)
Apologies, Peter — rumours of your emigration are clearly over-exaggerated!
I think it’s a bit of a cop out to say the grass is greener across the pond but I agree there is more grass. While I take Pete’s point about learning from a larger volume of experienced players — how many experiences does one really need to hear before information starts conflicting? Talk to three big names and they’ll all have conflicting opinions on many aspects of growing a start up!
What most seem to agree on is that it’s not just the learning from others that helps to make a success but even more important perhaps is the discipline to navigate your own course with dedication and assurance.
Given the infinite, multifarious routes to success, I believe there are more than enough experienced and successful Internet entrepreneurs based in the UK if one looks hard enough and if it’s about funding then I agree with the argument that funding will be available in the UK for a business that is strong enough to get it.
I think the picture is a little more confused than a basic brain drain; Tom Coates has been working for Silicon Valley company for some time, Ben Metcalfe might be in the US but he’s currently working for France Telecom.
But let’s be honest, anybody who’s spent any time in SF or the Valley realises that it’s got a great culture for this kind of thing.
Thing is, infrastructure never trumps ideas. If you’ve got a great concept, you get up and you do it. You should be successful wherever you are.
Take your Y-Combinator example: Reddit’s founders Alexis and Steve were in Virginia, not the Bay. They worked hard, did well.
I think one very important issue is that people in the UK prefer to be “lifestyle entrepreneurs”, to go out on their own because of the fringe benefits rather than pure determination to succeed. So it’s not that they’re by definition less supported, it’s that they aren’t prepared to go as far.
“…people in the UK prefer to be lifestyle entrepreneurs…”
That sounds like a rather large generalisation bobbie.
Of course it is, but we’re talking in generalisations here.
I talk to young companies, startups and tech entrepreneurs both sides of the Atlantic every day and there’s a larger incidence of lifestyle entrepreneurship here than in the US.
That doesn’t mean it’s wrong: in fact, if I were starting out on my own it would probably be for exactly those sorts of reasons (more control, family commitments, better quality of life etc).
But I can say with absolute certainty that it’s one reason that some of the people mentioned above have decided that the Bay is better for them than Britain.
bobbie: Wasn’t trying to give the impression that reddit were from the Bay. I was saying that SF funding for internet startups isn’t necessarily as bountiful as people sometimes seem to suggest.
Very interesting point about lifestyle entrepreneurs. I think you might be right (sometimes — with respect to David).
No I realise that Ian, I just wanted to point out that even if investors (even Y Combinator, which is more about hothousing that investing per se) are in the Bay Area for historical reasons, not all their investments are (though having said that, Reddit are now based in SF since selling to Conde Nast).
When I was in France, all I could hear was ‘Geez, if only we could move to the UK, it’s so much better for business there’.
Now I’m in the UK and all I can hear is ‘Geez, if only we could move to the US, it’s so much better there’.
The funny thing is I lived in the US. All I could hear was ‘Geez why did you leave France? It’s so much better there’.
Morality of the story: The grass is always greener … you know the rest.
LOL I can’t edit my comments — sorry about the typos :D