Straight, and to the point article from the New York Times that talks about how even in the age of telecommunication and distance meetings, Silicon Valley is still perceived to be “the” place to be for creating a technology start-up. I had never heard of the supposed “20 minute rule” meaning if a start up isn’t located within a 20 minute drive of the VC’s offices, they aren’t likely to be funded.

Anyhow, I can only speak from my experience as a lowly employee at two startups as to the reasons why Silicon Valley is still a great start up incubator. My first thought is that in Silicon Valley, there are many that see employment for stock options and low pay as an opportunity and not something to avoid. Around here, the story of so-and-so that worked at this-and-that pre-IPO and now lives in Monterey is part of the local folklore. Likewise, the opposite is true, pretty much everyone has been laid off or knows someone who has, sometimes multiple times. The result is a general familiarity with the business cycle of boom and bust. The option of working for one company for thirty years as a unionized employee with a pension is for better or worse, not so common. Therefore, it’s that much easier for a start up to attract employees who are willing to take a risk.

I also cynically suggest that part of this risk-taking mentality is due to the outrageous cost of living. It’s very difficult to do something as basically middle-class as owning a home here without two incomes pulling in some serious cash (or an interest-only mortgage). This is more incentive for people to take a leap at the brass ring, and since most couples are dual-income earners already, it’s easier for half of a couple to take a risk.

Next, technology is in a lot of people’s blood out here. I don’t get strange looks carrying around an iPod while simultaneously banging on a MacBook on the train. If you ask your co-worker how to convert a YouTube video to an iPod format, chances they can help you since they did it themselves last night. It’s like going to a Star Trek convention and the guy next to you can name of the grain the tribbles ate (quadrotriticale). You don’t have to go through an extra step of translation or a learning curve when explaining what you do and why it matters to potential employees.

Anyhow, despite these reasons, I do generally agree with the complaint that it’s a bit hypocritical that even though all this Web 2.0 stuff is partly about being social online, the people pulling the strings still swear by face to face meetings and local proximity. Maybe there is a third way, as Scoble points out, where the main base of operations is in Silicon Valley but all the development is going on elsewhere (sounds like a sweet deal for those employees that can live elsewhere).

Lastly, here I sit blogging this stuff in San Mateo, about halfway between San Jose and San Francisco. Maybe I should take advantage of this 20 minute rule… and get me some Amici’s pizza.

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