Silicon Valley vs. Silicon Alley – there have been countless comparisons on this topic over the course of the past year. We’ve all seen figures about IPOs and exits, about engineering talent, and so on and so forth (you can read a pretty succinct recap of what we’ve all heard here), but I’ve decided to offer a civilian’s perspective based on my first-hand experiences teaching to both startup students in New York as well as startup students in San Francisco. And from there, I’d ask that my peers in NYC take a lesson or two from our counterparts out west.
I’m currently out in SF for Data Week (nerds unite!), and I decided that I might as well teach an installment of my cohort analysis class while in town – so last night, I trekked over to Disqus’ HQ on Howard Street and hosted 20 or so students for a 90-minute workshop on customer tracking and cohort analysis. Similar to what I see with my class composition in New York, my students represented a wide variety of industries and functions; there were several “hot” tech names in the room, from established firms like Oracle to more emergent startups like TaskRabbit and Getaround.
Whenever I teach a class, I always expend a good 20-30 minutes before I go to bed that night reflecting on what worked well for the evening’s group versus what probably could have been improved. Following last night’s class I took it upon myself to further celebrate the public announcement of Savored’s sale to Groupon and wound up a bit too buzzed to perform this exercise, but I tackled it en route to the conference this morning and in doing so, I figured, why not jot down a few of my thoughts and let you all ponder the Silicon Valley/Silicon Alley debate through a slightly different lens?
In both NY and SF, there’s been a “big data” explosion (and an explosion of talent around that field), but there is still a strong demand for “vocational” measurement skills at the business management level.
I have pretty minimal street credit in San Francisco, but my class still sold out in under a week. There are myriad data scientists in both SF and NY right now (I actually had a data engineer from Disqus sit in on the class last night), but these folks tend to be much more focused on data for the sake of product development/engagement (SUPER important) vs. for the sake of business measurement/management – which is arguably just as important for product development (never mind fundraising).
Last week I met with Adam Enbar, president of Flatiron School in New York; Adam and his partner Avi Flombaum have an amazing vision around high-skilled vocational education for the tech world – specifically, they are launching a 12-week full-time “school” for Ruby where students graduate ready and armed for an entry-level developer’s job. Adam and I agree that there are myriad other startup functions for which full-time job training programs would make sense, and I personally truly believe that analytics is probably the second most material opportunity behind coding. There are tons of people out there with strong quantitative aptitude, but they don’t know how to apply this to their businesses because candidly, business analytics actually aren’t a science, but rather they are an art. Regardless of where they live or what resources their companies have, people want to get better at getting “creative” with business metrics and finding smart ways to understand real trends in their data and their businesses.
I know this point isn’t going to win me a Pulitzer any time soon, but the takeaway is that there are knowledge gaps everywhere.
People in the Valley think a lot less about money.
We’ve all received guidance from our VCs to focus on building brilliant products now and to defer the worry about monetization – but this is much easier said than done. In my New York classes, I get countless questions about calculating lifetime value, etc. and deal with a lot of people freaking out about how to assess a business that is pre-cash flow. I always tell my students to focus on “proxies” for revenue or premium features when they are pre-monetization (i.e. think about how Twitter or Facebook defined business analytics pre-revenue), but out west, people really ate this up and wanted to learn more about how to do so. Typically when I talk about regressions and things of that sort in New York, students’ eyes glaze over for a few minutes while they continue to think about the monetization problem; in San Francisco, students wanted to know more about how to really garner valuable learnings from their data to put their best feet forward with product development (and worry about monetization at a later time). I respect that they leave hedonic capitalist tendencies to my brethren in New York.
I love the New York tech scene and I’m so proud of how far it’s come in the past decade, but people in SF just “get things” a little bit more.
I love teaching and I especially love teaching to people who are completely new to the tech scene (this was me many years ago) – and so I guess I should consider myself fortunate that there are a lot of people that fall into this camp in NY. This is less so the case in San Francisco; most students have more domain expertise and just have a better feel for the vocabulary of what we’re talking about – when I talk up about Dave McClure’s startup metrics for pirates, I didn’t feel a need to give a 5-minute explanation of them the way I have to in New York. San Francisco students have a good feel for all of the vendors out there and what they offer, and they understand where data comes from; a lecture can be far more focused on real actionable insights versus how one would actually track and source data. (Note: In no way is this a complaint – I have high hopes and real confidence that NYC will get there in the next few years as the percentage of folks with domain experience increases.)
Our left coast friends are substantially more earnest/humble and will stop at nothing to “not sound like an idiot.”
Last night I got a great question from one of my SF students – “if someone asks me about my cohorts, what do I show them to not look like an idiot?” In fact, I believe this is the best question I have received to date. We talked about the types of charts/graphs/metrics VCs/CEOs are looking for when they are probing about cohorts, but I couldn’t help but think about the fact that I’ve never gotten a question even remotely like this in New York. In fact, oftentimes in NYC I find people blowing smoke up my ass after class about how awesome their product is and about how they are already doing everything correctly (hence, sounding like idiots) – well then, why are they even at my class? (Another quick aside: I have had hundreds of AMAZING students come through my NYC classes who are incredibly humble, but the bad ones unfortunately inevitably outweigh the good in terms of the stories they yield for me.) In SF, people are much more open to talking about what they don’t know how to do and getting honest feedback on how to improve themselves and their businesses. This is likely a function of the fact that we’re all inevitably just a little insecure in New York on account of being the “underdog,” but never has the difference been so readily apparent to me as it was after my class last night.
In San Francisco, the engineer is still king – and because of that, the companies in New York are a hell of a lot “sexier” for your average consumer (though sadly, many will go nowhere).
I’m a believer that the composition of the startup world portfolio is a 3-way Venn diagram: 1) companies that are fundamentally changing the world (think Square), 2) companies that are sexy and you’re pumped to tell your friends about and that you use for your own gain here and there (think daily deals, Lot18, etc.) and 3) companies that are somewhat boring to most of us but that service a real utilitarian need (think any B2B SaaS company). The reality is that most NYC startups fall in bucket 2 (there are certainly exceptions – think about Skillshare, an obvious #1), so I always have really interesting conversations with my students there. While I probably related to the companies represented by my SF students a little bit less, many of the people in that room will probably be wildly successful millionaires in the next few years while many more of us in NYC hope for even just a reasonable exit (or perhaps even more relevantly, to make a little money and simply not go belly-up!).
I hope this post does not read like some kind of bitchy rant against the NYC tech scene, because in no way whatsoever is that my intention. I love NYC tech and I am downright ENAMORED by the level of collaboration that I see in the Big Apple (Skillshare in and of itself is a massive testament to this – yes, I’m a total fan girl). Instead, I’m asking my Silicon Alley peers to do us all a solid and to learn something from our friends out west: let’s be honest and earnest about what we do and don’t know and let’s sharpen our focus on building truly incredible products and truly compelling user engagement (operative word being USER engagement, not just consumer engagement), and not waste our time getting lost in worries of dollars and cents (for now). Great products won’t sell themselves, but great products + smart analytics will most certainly take you far – and toward the black. And hey, it turns out that “boring” products are actually kind of cool a lot of the time, so let’s try to build some more of those. So if I were a betting woman, I’d venture to say that we’re never going to get the “street cred” enjoyed by our friends in the Valley if we don’t give way to this attitudinal change first.
I’m pumped to do my part by tweaking my New York introductory classes (and my attitude) a bit to try to match the level of sophistication I saw in San Francisco – what will you do?