Editor’s note: Recent news stories have pointed out the number of tech people leaving Silicon Valley for more attractive locations. An Inc. magazine article refers to “the Exodus” leaving the Valley and an article in The Wall Street Journal cites a Silicon Valley study that found more than 7,500 residents left the Bay Area in 2015 for a more affordable lifestyle. A CNBC interview in 2015 also cited Silicon Valley’s soaring costs, and an Indeed Hiring Lab study this year added the desire for flexibility as another motivating factor. We asked three software executives to share their insights about why they located their startups in locations other than Silicon Valley and what those locations enable them to achieve. They are:
- Philadelphia – Lucinda Duncalfe, CEO, Monetate
- Los Angeles – Mary Ann de Lares Norris, COO, Oblong Industries
- Indianapolis – Mitch Black, President, MOBI
Q. Please share your insights as to why you think your city is a better location for startups than Silicon Valley.
PHILADELPHIA – Lucinda Duncalfe, CEO, Monetate
Monetate has deep roots in Philadelphia; the founders and I are all Philly people. There are some big advantages of starting here. Philly has its own identity – we’re very “real,” both as individuals and as a region. As a result, there is a specific kind of company that is likely to be born and do well here. We’re not going to be the ones who come up with Instagram or HipChat, but we will come up with real products that provide real value, which fits culturally with who we are and what we do. I think Monetate is an example of that.
That cultural identity has tremendous strengths. Our community is super-supportive. We have lots of very talented technical people, yet it’s not mercenary like it is in areas like Silicon Valley and cities like New York. Our Midwestern “stick-to-itivenes” helps us get through the inevitable troughs businesses face as they scale.
Philly has reached a critical tipping point; students are staying after graduation. The city has an unheralded richness of colleges and universities – more than Boston – and previously, kids were leaving. Getting that talent to stay is a huge driver for vibrancy in the region.
Of course, Philly faces some challenges too. The one I’m focused on is the connectivity between entrepreneurial generations. The generations of successful founders and executives that came before me disappeared with their cash and their experience. We’re missing connectivity. We need the folks who have already made it to become angel investors, advisers and board members. We need more activity from these experienced people, who can help the new talent avoid mistakes and accelerate their growth.
Philadelphia is a great place to start and grow a business, and the more of us who do it and reach back to help the next person trying, the more successful we will all be.
LOS ANGELES – Mary Ann de Lares Norris, COO, Oblong Industries
Silicon Valley certainly can be the right choice for some startups; but based on what we do and what we value, there’s no better place than Los Angeles. It boils down to four key reasons for why we chose downtown LA for our global headquarters.
The heritage. LA has a long history of melding design and technology to realize big ideas. Professional filmmaking was born in Hollywood. The aerospace industry grew up in Los Angeles. That spirit of big ideas is still alive today with us and our LA neighbors like SpaceX, which are using the powerful mixture of design and technology to create exhilarating innovation. The infrastructure for startups also has been given tremendous support by Mayor Eric Garcetti’s administration pursuing smart initiatives to make Los Angeles a vibrant, welcoming home for entrepreneurs.
You can especially see the art-technology heritage come to life in the Arts District where Oblong is located. One of the largest art galleries in the world recently opened just across the alleyway from our offices. It’s incredibly inspiring for us to work where artistry and industry meet, and for us to carry on the city’s rich history.
The talent. LA is home to some of the world’s top universities — including Caltech, UCLA, USC, Occidental College, Harvey Mudd College and ArtCenter College of Design — along with more than 100 other accredited colleges and universities. Plus, LA has more engineering graduates than any other county in the U.S.
It’s a treasure trove of the best minds in the tech industry and beyond. It’s where game-changers from all over the globe convene in a dynamic international community. We get to draw on all of that talent and work with other visionaries who share our mission to create meaningful, capable, durable and beautiful products and solutions.
The access. It’s undeniable that California has a high cost of living; Silicon Valley is an extreme example of this. By contrast, the greater LA area is quite varied in its housing options. Our office is conveniently located close to public transportation, so we’re able to attract talent from affordable communities in the broader LA area, which are just a train ride away.
When we started Oblong, the Arts District in LA also gave us access to large, affordable warehouse spaces that we needed to build solutions at architectural scale, so we had room to dream big, create and grow.
The culture. The revolving-door mentality that can infiltrate Silicon Valley startups is not prevalent in LA culture. The tendency to job-hop every couple of years just isn’t characteristic of our talent pool. By choosing LA, we’ve been able to enjoy strong stability in our employee base that I believe would not have been possible in Silicon Valley.
Los Angeles has always been on the cutting edge with a reputation for outside-the-box innovation. The world has always looked to LA for the future to happen. We feel honored to be a part of that vision and reality.
INDIANAPOLIS – Mitch Black, President, MOBI
I met my co-founders in Indianapolis. We’ve been friends since learning how to ride two-wheeler bikes (maybe even longer), so choosing it as the place to base MOBI was an easy decision. From a broader perspective, there’s a growing tech community developing in Indy. We’ve gotten lucky with the local talent pool and, with the help of a strong company culture and office that rivals those on the West Coast, have been able to maintain 100 percent retention of our technology/product team for the first quarter of 2016. I might be making an assumption here, but I doubt that the tech firms in Silicon Valley can say the same due to the saturation of tech companies. Either way, it’s a stat we’re proud of and eager to maintain.
The Indy tech community supports thousands of jobs within the city, but this couldn’t be possible if not for the unparalleled pipeline of talent that our universities provide. Indiana colleges like Purdue University, Rose-Hulman Institute of Technology, DePauw University and Indiana University crank out thousands of highly skilled computer science, computer engineering, and computer and information technology graduates every year. These schools position students perfectly to take on the roles of software engineers, developers, programmers and designers at technology companies throughout our city. In fact, over 50 percent of MOBI’s development team graduated from a local university.
Companies from around the globe are also choosing to expand or relocate to Indiana for some Hoosier hospitality. Emarsys, the Austrian-born B2C marketing cloud company, recently chose to put down roots here by establishing its North American headquarters in downtown Indianapolis. Appirio recently relocated its headquarters to Indy from San Francisco. Salesforce will invest more than $40 million over the next decade, adding 800 new jobs and expanding its regional headquarters in Indianapolis into the newly announced Salesforce Tower. MOBI has also added 110 new employees and has contributed to the growing tech scene through key acquisitions and partnerships with Microsoft, IBM and HP.
Overall, building a tech company in Indianapolis made sense for us and it continues to prove a wise decision. I’m proud of our Indy roots, and look forward to watching the city continuously grow and shine as a tech hub.
Mitch Black is president of MOBI. Leveraging his years of industry leadership experience and knowledge of the enterprise mobility space, Mitch works closely with the MOBI co-founders on the company’s overall direction while providing daily executive leadership with the MOBI team. Previous to his position at MOBI, Mitch spent 20 years in other executive positions in the mobility industry, leading companies such as BrightPoint, BrightStar, PCS Wireless and Verizon Wireless.
Lucinda Duncalfe is CEO of Monetate. A seasoned entrepreneur and innovator, she has proven experience building mature sales and operations cultures and developing product strategies that accelerate company growth. She has served on Monetate’s board of directors for the past seven years and helped Monetate create and establish a multibillion-dollar market for digital personalization. Lucinda won the Eastern Technology Council’s Enterprise Award for CEO of the Year and was an Ernst & Young Entrepreneur of the Year in Philadelphia.
Mary Ann de Lares Norris is chief operating officer of Oblong Industries. With extensive global expertise in strategy, analysis and people management, Mary Ann has a proven track record of innovation in the workplace. She previously served as general manager of the Oblong European division, based in Barcelona. Prior roles include chief operating officer of a Parisian interactive television company, director of strategic planning at Mattel, executive producer at Sony Electronic Publishing and producer at The Voyager Company. Follow her on Twitter.