19 May 2014
It's always funny how smart people look at the same data and come away with totally different conclusions. That happened with CB insights recent comparison of NY vs. Silicon Valley deal sizes.
Specifically, they examined comparable companies in both regions and their funding totals including Quora vs. StackExchange, Betterment vs. Wealthfront and Indiegogo vs Kickstarter to name a few.
As might be expected, the Valley companies raised more money in aggregate and in comparable rounds.
But the thoughts people sent over were very different and ranged from:
- "The Valley is where the game-changing cos are built. They require more capital. NY has never produced an iconic tech company."
- "Valley companies don't worry about monetization early the way NY companies do."
- "Ask any entrepreneur, and they'll tell you Valley investors are not as risk-averse as their NY counterparts. It shows in these numbers."
- "NY companies have real business models unlike their Valley brethren."
- "There is more competition in the Valley for the best deals which allows the best companies to raise more financing."
- "Quora's valuation and ability to raise capital are wholly inconsistent with their actual business. It's Valley hype and their fascination with pedigree."
There was, of course, a certain tribalism apparent in the received comments. West Coast folks talked their book, and the East Coast folks did the same.