Tech is everywhere and everywhere is tech
Sam Altman, the head of highly-respected accelerator Y Combinator, says being based in Silicon Valley and the San Francisco Bay Area is less important that it used to be for tech startups.
“The incredibly high cost of living, power of FB/Google/etc, and a few cultural issues (e.g., short tenure for people at most jobs), have finally become a counterbalance to the Bay Area’s incredibly strong network effects,” he wrote in a Twitter thread
Altman thinks it’s still important for startups to have ties to the Bay Area to tap into its strong network of talented, well-connected people, and risk-embracing investors. But the fact that even the most influential people in that part of the world are discovering the benefits of building a company elsewhere feels overdue.
It will come as no surprise to many readers of this newsletter that you can build a successful tech company almost anywhere in the world.
A great example – Leeds in the North of England wasn’t a good city for tech at all in 2001. But that’s when Blue Prism
, a pioneer in ‘robotic process automation’ (RPA) started out. It now has offices around the world but is proudly headquartered near Warrington – still in the North of England – while leading in automation, one of the hottest fields in technology. While Leeds has a decent amount of tech these days, Warrington doesn’t really. Location doesn’t matter if you have the right approach to your business.
My favourite part of Altman’s thread is when he says companies moving outside the Bay Area are “just sort of diffused everywhere. I doubt there will ever be another American city that will eclipse SF for concentration of software startups.”
As tech gradually transforms every industry and every aspect of our lives (tech is everything, and everything is tech), there’s more need for more technology companies, and they can’t all be based in one small patch of land. Tech is everywhere, and everywhere is tech.
One word of warning though – while tech entrepreneurs are increasingly embracing the idea of being based in a diverse range of locations, that doesn’t mean they have the right kind of investors on their doorstep.
The wrong kind of investor can stifle a tech startup’s growth, and you don’t find the right investment mindset and expertise everywhere. Tech investors need to address this issue with a more location-agnostic approach. That can be difficult (as investors like to be able to easily visit the companies in their portfolio) but those who figure out a solution will be able to tap into some incredible opportunities.