Should you move to San Francisco to build your startup?


Recently, TechCrunch published an article about moving to Silicon Valley. Author Sten Tamkivi's  advice essentially boils down to:

Startups with global ambitions need to accept that there is no single best place in the world to win, not even the almighty Silicon Valley. If you learn this early on you have the advantage of building your culture, your processes and systems to be able to handle the fluid, distributed and mobile work to come.

I do not agree completely. As an outsider who came Bay Area during last decade, I should say this - Bay Area remains the best place to build technology startup at the moment. High cost of living, competition for talent etc. are secondary issues. In return, you get unparalleled access to capital, talent, and other resources related to entrepreneurship.

However, I generally advise NOT moving to SF if you aren't part of any established networks in the valley. Silicon Valley is giant network of several networks. To be successful in the Silicon Valley you need to be part of at least one of those networks. I often see lot of people making mistakes of moving to Bay Area thinking it will magically transform their business into successful one. What do I mean by being part of the networks?

1. Alumni Networks - You graduated from elite schools/universities like Stanford, UC Berkeley, MIT, and Harvard. Lot of alumni of aforementioned schools have created lots of successful startups. And number of VCs have graduated from these schools. So it's relatively easy to get started, receive funding, and eventually scaling.

2. Mafia Networks - Mafia not in a literal sense. Mafia in valley parlance means being part of PayPal Mafia, Facebook Mafia, Google Mafia or pre-IPO employee of any successful unicorn of last 2 decades.

3. Accelerator Networks - Accelerators like Y Combinator, Techstars, AngelPad etc. not only provide funding but also place you in the network of investors, founders and startups.

If you have already started your startup and thinking about moving to valley and aren't part of any of these networks then traction is your best friend. Hockey stick graph is the social currency in the valley.

P.S. It goes without saying but if you are building - a. non-tech company or b. addressing specific geo-location market (like Asia) via your offering then don't even think of moving to SF.

Note: I cross-posted this as an comment on Quibb.