San Diego And Silicon Valley - It's Complicated
As anyone who’s ever stood next to a supermodel can attest, how you feel about yourself can depend on who you’re compared to.
San Diego’s entrepreneurial ecosystem is, by any measure, a success, but less than 500 miles up the coast (practically shoulder-to-shoulder, geographically speaking) lies Silicon Valley, the global epicenter of entrepreneurship and innovation. Located as they are in the same state, San Diego is often overshadowed by its more successful neighbor. Even closer to home, Los Angeles has better deal-making numbers than San Diego.
San Diego entrepreneurs can get defensive when asked about San Francisco and are quick to criticize the Bay Area’s traffic, weather, cost of living, housing prices, high salaries and so on. They’ll point to employees they’ve hired away from Silicon Valley as proof that it’s better down south.
“I actually did grow up here and then went to Silicon Valley during the boom years and while I was up there everybody that I met who was a San Diego transplant was spending the rest of their career trying to figure out how to get back to San Diego,” said David Warren, CEO of Linked Intelligence, a sales software company.
“We’ve recruited people from Seattle, Portland and Silicon Valley so I don’t think we lose people to them; I think they’re losing people to us,” said Lori J. Steele, CEO of Everyone Counts, an elections software firm.
But San Diego does covet Silicon Valley’s money, venture firms, angel investors and talent pool. Particularly its money. Entrepreneurs everywhere complain that there is not enough investment money in their town, but the keening is especially loud in San Diego, so close to the Venture Capital Capital of the World.
Part of the problem is that most Silicon Valley venture firms think San Diego is close enough to service without opening an office there, said Barbara Bry, a San Diego entrepreneur-turned-angel investor. As a consequence, those VCs aren’t tuned into the San Diego scene.
“You invest in people you know,” she said. “So you see someone at the grocery store and your kid goes to school with their kid. You have all these informal relationships that you never develop in San Diego because you don’t live here. And also you’d rather invest where you live so you don’t have to get on an airplane.”
Greg Horowitt, a professor at UC San Diego and co-founder and managing director of T2 Venture Capital, studies city entrepreneurial ecosystems and says they tend to be self-selecting.
Silicon Valley is the destination for grinds, people who are willing to sacrifice any semblance of a personal or family life to succeed, people who stiff-arm sleep and think anyone with a tan isn’t to be taken seriously.
San Diego, by contrast, is a bit more mellow. It attracts entrepreneurs who want to have a life outside of work and who are drawn by the amenities, he says.
Perhaps because of that, San Diego entrepreneurs are, according to those who’ve relocated here, exceptionally collaborative and friendly. Life science researchers on the Torrey Pines Mesa like to talk about startups launched as the result of chance encounters in the parking lots or on mountain bike rides.
And San Diego has carved out its own entrepreneurial niche. While Silicon Valley focuses on software and social media, San Diego is playing to its strengths in wireless, clean energy, life sciences, action sports and defense contracting.
Which, when you’re standing next to a supermodel, is better than developing a great personality.