The current issue of the British magazine Director has a feature on entrepreneurs who have decamped from Old Blighty to headquarter their companies in Silicon Valley. The reasons given for moving to the Bay Area are nothing surprising, namely access to capital and talent, but the story does have an interesting outside-the-echochamber perspective. Not to mention the charming spellings of "epicentre" and "mould."
Despite the dubious comment by a British software developer that "There are more companies started [in Silicon Valley] by foreign-born entrepreneurs than by US-born entrepreneurs," the article rightly points out that many Brits do start or move their companies here. Three of the twenty startups at incubator Y Combinator are helmed by UK or Irish-born founders. Unique reasons cited for moving to the US: Europe's language, culture, and currency issues hinder the ability to scale, large European companies aren't in the habit of working with startups, and the weakness of the dollar makes office space cheaper.
A few stats do bring the argument down to earth. According to Ernst & Young data, Silicon Valley Web 2.0 companies scored 25 venture capital deals in the first six months of 2007 for a total of $91 million. The UK wasn't all that far behind with seven deals for $22 million. Between 2002 and 2006, the Valley accounted for 40% of all Web 2.0 funding; it's now down to 20%. That's meant to show the Valley's decrease in clout, but come on—how many people knew what Web 2.0 was in 2002, even in concept? The phrase wasn't coined until 2004 and one would expect the movement to migrate from the epicenter over time.
One last thought, a quote from Brit Keith Teare of Edgeio:
"I don't know if it's a national characteristic, but [in the UK] the idea of only doing things that are achievable is in stark contrast to the American view of reaching for the moon."
It's obvious what he's getting at—Americans think big. But it raises an interesting, if unintended question: Are unachievable ideas getting Sand Hill Road funding?
Photo: Florathexplora
