Originally published January 13, 2007.
There are a few hubs of venture capital and entrepreneurship in the world, but Silicon Valley is the undisputed king of them all. So, after dutifully finishing my Quarter 2 exams, I boarded a plane straight to San Francisco to check it out. Two other Darden students and I organized a trip for nearly 30 Darden students on a corporate and venture tour of Palo Alto, Mountain View, San Jose, and San Francisco. Some 14 companies opened their conference rooms (and fridges!) to us over the course of a week as we learned about companies at every stage of life – from startups that never made it, to the Google monster that’s eating Silicon Valley and the venture capital firms that finance and guide the whole thing.
In this Part 1 of my winter break reflections, I will offer some comments about the culture of starting new ventures in Silicon Valley to contrast with the comments of Part 2, which will reflect my experiences at the 2007 Batten Venture Bootcamp in the Washington, DC area.
First: Some insightful comments from a venture capitalist about working in venture capital. “Move to Palo Alto.” That’s career step number one for anyone hoping to make career inroads in the Mecca of venture capital. If you want to start a company and need to build a management team, start by asking your waiter – chances are he has a PhD in computer science and just got laid off from a tech firm downsizing or outsourcing and is just itching for a startup. Or just drive around town and start knocking on corporate doors – talent is traded pretty fluidly throughout Silicon Valley, and it seems like many folks have been part of a startup (it’s only the rich ones that you hear about in the papers) or are just waiting for the next big idea.
If you do start a company, congratulations. You’ve got the densest cluster of venture capital firms in the world to compete for an equity stake in your business. With high competition and good track records of success, you can expect generally higher valuations along Sand Hill Road than you’d fetch in Boston, New York, or DC. By the way, Sand Hill Road has got to be the most beautiful death march for some entrepreneurs, who go door to door peddling their business plans in hopes of million-dollar funding.
If you don’t start doing business soon though, you’d better make friends with some of the wealthy residents of Palo Alto who might put you up for a few nights in their home. Because real estate prices are averaging $3 million for a single family home, or about $1,000 a square foot. See that floor tile you bought from Home Depot for $4? You’d better have a grand to buy enough land to put it on. Even the investment bankers in San Francisco, who are making a horde of cash, complain about residential real estate prices.
And give up golf. Instead, invest in a good wet suit and a surf board that can hack it in the mobs of Santa Cruz or the daredevils at Mavericks. One student on our trip was having trouble finding an interview invitation at a company until he mentioned that he surfed, which sealed the deal.
If you’re coming from any other business school in America, recognize that Stanford students can wake up one day in June after graduation, realize they need to get a job, and walk three blocks down the road in a Stanford hoodie and meet with some of the biggest and best venture capital firms and portfolio companies in the world. At least the Berkeley gang has to take the train, but those two schools combine to supply a boatload of great talent into the Silicon Valley marketplace every year.
All in all, I found the venture community from San Francisco to San Jose to be wonderfully intoxicating, and copmanies are changing the world every day there. Even tech regulars like eBay and Google are maximizing the value of their business platforms by launching new services that reach millions on day one.
And my wife says hi to all you in the blogosphere.
Companies on my Silicon Valley visit (in order of appearance):
Labrador Ventures
Sequoia Capital
eBay
TellMe Networks
Adobe
frog design
GI Partners
IDEO
HP
I also met Darden alumni who joined us for evening receptions from the following firms:
Piper Jaffray
Bear Stearns
Deloitte (Consulting)
SideStep
Microsoft
Recent Comments