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Summary:

iTaggit founder, David Altounian wrote on his blog recently of a question that many startup entrepreneurs have to address. It’s on the topic of geography and whether it matters, especially when it comes to funding. Or, as David puts it: Can emerging tech ever achieve “location […]

iTaggit founder, David Altounian wrote on his blog recently of a question that many startup entrepreneurs have to address.

It’s on the topic of geography and whether it matters, especially when it comes to funding. Or, as David puts it: Can emerging tech ever achieve “location independence”?

David’s company is based in Austin, which isn’t exactly a tech backwater, (Yes, he’s ex-Dell). But it’s still a natural, plaguing, question for him. And since, statistically, most startups are outside the hub of Silicon Valley, this also forms our…

Question of the Day
There has been a recurrent question in discussions that I’ve had recently with potential investors, other web executives, and partners: ‘Does an emerging tech company need to be in the Bay Area to have a chance of success?’?


“There are two sides to this issue,” David writes, as he lays out the advantages and disadvantages of being in Silicon Valley. But what are the most practical solutions to the geographically challenged?

Here is David’s list of positives and negatives. But what do you think?


I. Advantages to being in Northern California.

* There is an abundance of funding sources out there and they all seem to prefer to invest in the area.
* There are also a great number of tech companies already established out there so the opportunity for partnerships may be easier due to location.
* Finally, because there is a rich business base in tech there is an incredible amount of services and resources that are competing for mind and dollars of the tech community (note SEO/SEM consulting firms – there are only a few in Texas so they are in high demand. In the Bay Area there are so many that they are fighting for clients).

II. On the other hand…
* There is also a tremendous amount of competition BY the tech firms for technical and marketing employees.
* So wages are high and it appears that turnover may be a challenge there.
* The area also acts as a fairly ’small town’ so secrets are not so easy to keep. (For example, last week I was at a popular Woodside breakfast place and it was very telling to see who was meeting with whom!)

So… what does this mean for us at iTaggit? Well, over the next few months we are going to attempt to build a stronger corporate presence in the bay area while maintaining our base of operations in Austin. We have a fantastic, dynamic workforce and we need to develop the tech infrastructure for Web 2.0, 3.0, 25.0, etc. right here. We believe that we can combine the best of both environments to deliver a better solution for our users and a lower cost of operations for our investors. We’ll see how it goes…

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David Altounian is the CEO of iTaggit, a Web 2.0 startup that helps you collect and catalogue stuff that matters most to you. Previously he founded Motion Computing, the leading provider of slate tablet computers for vertical businesses. David has been in the high tech industry for over 20 years working at such companies as Dell, Motorola, Compaq, and Ashton-Tate. Read more from David on his blog. His original post on this topic appeared on his blog under the title: Location Dependence (independence?) for Emerging Tech

  1. Passion, perseverance and hard work are the ingredients to success, not location.

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  2. Being in the Bay Area does not matter. Being in a technology center does.

    btw,
    Austin has lots of venture activity, see Google Maps mashup below:
    http://www.texastechpulse.com/intelligence/map/

    Lots of venture funds:
    http://www.texastechpulse.com/vc.php

    Very recently funded companies in Austin: Nuventix, Element Labs, Astadia, SensorTran, Troux Technologies, OnNetworks, LabNow, Ziliant, BreakingPoint, CoreTrace, FiveRuns, and on and on and on. It’s a great market for technology startups.

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  3. If potential employees prefer, say Google, to your biz, doesn’t that say something important about said biz?

    If you can’t compete with the best, you’re not the best.

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  4. I wouldn’t even hint at Austin being a tech backwater. It’s possible one of the best areas for design and anything else that has to deal with it. SXSW should be a huge indication at that.

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  5. Employing irony guys, we know there is nothing wrong with Austin, which …”isn’t exactly a tech backwater.”

    ;)

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  6. location is bullshit in today’s economy, what you need is experience and talent.

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