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February 18, 2008

« Music Clusters | Main | That Sinking Feeling »

For Seattle, Redfin CEO Glenn Kelman:

Internet guru Michael Arrington often opens conferences by asking audience-members from Silicon Valley to raise their hands and then, if they were born in the Valley, to keep their hands raised. Hands go up and down like The Wave.

And this is what Michael loves about the Valley: that it calls out at dog-whistle frequencies to nerds across America, Russia, India and China. The single-mindedness of their migration belongs in National Geographic. My first roommate spent four years building a company in San Francisco without ever buying furniture. When his startup went bust, he packed for the trip home to Toronto the same day.

Seattle is different. People live in Seattle because they love Seattle. When I was still looking for a reason to be here myself, I often asked Redfin recruits what brought them to town. The answer I always hoped for was “CONQUEST.” But what everyone talked about was something I still barely understand: the lifestyle and schools, the mountains and lakes. “Do you have any idea,” I finally told one candidate, “how bizarre it is to swim in a lake at the center of a city?”

For Silicon Valley, Michael Arrington:

Having literally tens of thousands of bright tech minds around you to listen to and challenge those ideas, as you do in Silicon Valley, gives entrepreneurs a critical competitive advantage ...

Sure Seattle is beautiful (Kelman talks about lakes and outdoor stuff a lot in his post). And if you want to have a balanced, healthy lifestyle, that’s a great place to do it. If you don’t think you have what it takes to make it in Silicon Valley, maybe Seattle or other mini-tech hubs is the place for you. But the best of the best come to Silicon Valley to see if they’re as good as the legends that came before them. It’s a competitive advantage to be here. And if you aren’t willing to take advantage of every possible advantage to make your crazy startup idea work, perhaps you shouldn’t be an entrepreneur ...

The fact is that all those great things about Seattle, or wherever, don’t have a damned thing to do with offsetting the business and cultural advantages of Silicon Valley. Making lifestyle choices is fine, but don’t delude yourself into thinking those choices are anything but a tradeoff. If staring at lakes and skiing after work are important to you, don’t pretend to be surprised when your startup doesn’t cut it.

 And Kelman's response.

(H/T: Bert Sperling). I see Kelman's post as a pure play to position Seattle in the battle for talent. Kelman's rationale also sounds a lot to me like the one Peter Jackson told me was behind his move to Wellington, New Zealand - LA is a hyper-competitive rat-race with lots of disamenities, Wellington offers a stable place to work, cheaper housing and an amazing place to live.  But the fact of the matter is that there are hyper-driven people who will choose the Valley, and many others who will trade-off in favor of quality of life plus a solid, though perhaps not cutting edge tech network.


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Yule Heibel

Interesting little dust-up... Take a look also at Margaret Pugh O'Mara's article, "We are not 'the next Silicon Valley'," posted in Crosscut today (Feb.18). (See http://tinyurl.com/2fhly3 )

O'Mara is an assistant professor in the Department of History at the University of Washington and Stanford research scholar (urban history and the globalization of the high-tech industry).

She writes: "Silicon Valley resulted from a combination of powerful local institutions, savvy real estate development choices, immense capital investment by the Cold War military-industrial complex, and the simple good fortune of being on the right side of national economic and demographic trends. The repeated failures of other places to replicate that success – much less seize Silicon Valley's high-tech mantle – attest to the trickiness of getting this formula right. (...snip...)

"You need lots of money that can be spent (somewhat) recklessly. Military grants and contracts provided the capital needed for Valley pioneers like Hewlett-Packard to survive in their earliest, leanest years and created a demand for sophisticated technologies before there was a sizeable commercial market. As military contracts declined in the late 1960s, private venture capitalists and angel investors rose to take their place, giving smart but untested people repeated opportunities to innovate and develop new products."

In contrast to "The Wave" phenomenon of people not being "from" the area, O'Mara writes that SV actually has a higher percentage of home-grown vs. attracted talent:

"Seattle has excelled at attracting talented people; its high proportion of college-educated residents attests to this. It hasn't done as well at producing them. The people who went to college here make up a relatively small part of the tech workforce. In Silicon Valley, Stanford and Berkeley pulled talented students to the Bay Area from across the country and the world. Many of the builders of the Valley, from Hewlett and Packard to Google, are products of local universities. A region's students are essential to its future economic success."

While she admits that Seattle has a "true regional advantage" in terms of recently having aggregated (as it were) piles of VC money, she concludes that it won't be another SV perhaps because (most simply put) history doesn't repeat itself exactly.

But building on "core competencies" in turn helps build a city's or region's strengths: "Silicon Valley succeeded not because of the 'silicon' but because it was doing something that complemented existing regional strengths."

In the end, that's a comforting perspective for those of us in what sometimes looks like the penumbra of SV's magic glow. Reminds me of Shakespeare's words of wisdom (verbatim), "Our remedies oft in ourselves do lie, which we ascribe to heaven. The fated sky gives us free scope -- only doth backward pull our slow designs when we ourselves are dull."

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