A Friday series exploring Startups and the people who make them go. Read all If the Shoe Fits posts here.
Do you believe that Silicon Valley is the best (only?) place to start a company? That there is some almost magical ingredient that isn’t duplicated anywhere else?
Many people do and more did back in 2010.
Demis Hassabis, co-founder of high-flying DeepMind didn’t believe the myth.
“I was born in London and I’m a proud born and bred Londoner. I obviously visited Silicon Valley and knew people out there and also I’d been to MIT and Harvard and seen the East Coast. There is this view over there that these kind of deep technology companies can only be created in Silicon Valley. Certainly back in 2010 that was definitely the prevailing view. I felt that that just wasn’t true.”
Investor Peter Thiel was one of the true believers.
“At that time he’d never invested outside of the US, maybe not even outside of the West Coast. He felt the power of Silicon Valley was sort of mythical, that you couldn’t create a successful big technology company anywhere else. Eventually we convinced him that there were good reasons to be in London.”
Hassabis convinced Thiel to invest; Google acquired it for $400 million, and DeepMind is still making AI history.
One of the major reasons Hassabis wanted to stay in London was the availability of incredible talent.
“One of the things was I thought it [staying in London] was going to be a competitive advantage in terms of talent acquisition,” said Hassabis. He went on to claim that there weren’t that many intellectually stimulating jobs for physics PhDs out of Cambridge at the time that didn’t want to work for a hedge fund in the city.
Unlike Silicon Valley which, in addition to its normal talent shortage, suffers a severe talent crunch in whatever tech is hottest.
Silicon Valley may be a great place to start a company if you are connected, but for the majority who aren’t there are plenty of locations that are just as good, if not better.
Of course, that depends on whether your goal is to found a company valued for funds raised, which is best done in Silicon Valley, or to found a company that is valued on actual revenue, which can be done anywhere.
In fact, for the latter, anywhere could even be preferable to Silicon Valley.
Image credit: HikingArtist