There’s likely a million posts out there on this but a friend of a friend recently asked me and I’d like to weigh in on this. Generally, this is what I told him. As context, he’s choosing between London and Silicon Valley, but really anywhere and SV can be the comparison.
Where are your users?
My first question is always where are your users. Nothing beats meeting and seeing your users. You need user feedback; it’s a must. You want to grow your collection of user stories, accumulate the 99% percentile unfulfilled use cases, and start nailing them with your product. It may sound easy, but it isn’t. And it’s that much harder if you are across the globe from them. I can understand moving if you are moving to your customers, but if you are established and moving away, consider it wisely and tread carefully.
How much funding do you need?
Silicon Valley has access to large sums of money. You don’t need to go to many places on Sand Hill Road if you have a product showing traction. Even if you don’t have traction, but have a strong belief and a strong track record, you can get large sums from these tech savvy investors. Historically, New York was the investment capital of the world. It took effort and time to grow a tech centric investment community. If you’ll need hundreds of millions of dollars, fundraising in SV seems appropriate. But by the time you raise your million dollars of Series A, you might already be in Silicon Valley or have a good reason not to be. I have heard some investors like to keep tabs on their money (who wouldn’t), and you being close would be a benefit to them and their billions.
How large a company do you need?
If your company needs to scale to tens and thousands of employees, especially engineers, Silicon Valley or the up and coming NYC and Austin look decent. American cities think different than the rest of the world. Jack Ma knew this, London’s Silicon round-about knows this. Specifically in Silicon Valley, you have access to Stanford and UC Berkeley, both world class in engineering. Not to mention the fabulous weather that will always attract East Coast inhabitants. Anyways, as a company, with a business plan and forecasts, you have to worry about where you are going to get your talent. A players hire A players, and you need your all stars who will push your company and recognize new products at the front lines. You can find that elsewhere, but it’s a lot easier if there’s a lot more people in general.
What kind of culture do you want to lead?
As I said before, people know Silicon Valley is different. There’s a reason Facebook, Google, Apple, Uber, Dropbox, Airbnb, RocketLawyer are based and founded here. The people here are hackers, experimenters, growth hungry, and many want to be famous or rich. Others just have strong beliefs so they come here to make them a reality. This kind of culture isn’t born in a petrie dish, it’s born with others. If you move your startup here, expect people to poach your employees, to socialize with other startups, and to work on their own projects. This culture of hacking and constant improvement can exist elsewhere, but it definitely exists here and will alter your culture.