There has been A LOT of chatter in the tech media and amongst prominent influencers and venture capitalists about the great mass exodus from the bay area and where the "Next Silicon Valley" will be. Austin, Miami, New York City, all of them having their moments in the spotlight. While I think all of these cities have the potential to produce an amazing tech scene, the future of the tech world doesn't lie in any of them, the future of tech is...everywhere.
What our current health crisis has shown for many in the tech and startup world is that we can work from pretty much anywhere. I have friends and colleagues who are running businesses from the mountains so they could hike/ski, I know founders who spent the last few months driving around our country using nothing but a laptop and a hotspot to run their business. I've seen people who never thought it was possible to start a company from anywhere other than an office where you are all together, start and scale up a business over zoom and slack. And I can also tell you, investors taking notice.
In the last month, I have spoken to emerging funds from Minneapolis, Chicago, LA, Miami, Denver, and Indianapolis. All of them raising funds because they are bullish about the future of tech in their cities and more importantly, their region of the country. The best thing about all of this is a realization that founders can start a business from anywhere, empowering them and their employees to build and contribute, while living wherever they find is best for themselves and their family's lifestyle.
The next decade of startup innovation will be defined by investors from Boise backing a startup out of Phoenix or a small upstart in Raleigh attracting the top funds from New York City. A big reason why? It is more efficient. Now that we have seen and shown in hundreds of successful startups that you don't need to cozy up to the giants of Silicon Valley, investors will look to back the pragmatic founders all over the country who are finding ways to build businesses that are efficient yet can still scale with venture financing behind it. It's also a better deal for founders as well, without needing $150,000+ salaries (lower costs of living) and minimizing overhead (avg. $4.50 a sq foot in the valley!), you can raise less capital, build lean operations, and scale a business where the founders and employees hold more of the equity that they worked so hard to build.
As more and more large companies become distributed, talent will ultimately get redistributed. Employees, given the ability to live anywhere…will. They will move to be closer to family, loved ones, or friends. They will move to cities or states where they can enjoy the non-work activities that they are passionate about. These people are your future founders, they are in Portland, Raleigh, Pittsburgh, Indianapolis, LA, Denver, NYC, and more. Investors are ready for that future and we are excited about the possibilities it unlocks.
There will still be founders and startups tied to traditional hubs, San Fran, Boston, NYC, are all phenomenal cities with a lot to offer and, for the right types of people who love life in the big city, they will thrive there. But the distribution of talent and capital has begun and what was once a very concentrated industry will now look to a bright future where startups become the landmark businesses of smaller cities versus just another name in a sea of startups in major hubs.