Comments on: Why the Smart VCs Are Boarding their Jets

By: 98point2 — Entrepreneur perspective:Doing Business in Russia part 2

98point2 — Entrepreneur perspective:Doing Business in Russia part 2 — Fri, 27 Mar 2009 18:59:38 +0000

[...] once you visit Russia, it becomes clearer. Recently in TechCrunch – Sarah Lacy outlined that more VC money would be going abroad due to the crisis – and I certainly agree with her. I plan to visit Russia [...]

By: traffichoney

traffichoney — Fri, 27 Feb 2009 10:05:39 +0000

This blog is a great showcasing on one of Sarah Lacy’s ideas on where technology investments should be going. She also believes strongly in others such as mobile. check out this my blog coverage of her talk at a Girls In Tech event where she spoke about her views on mobile: http://traffich...rah-lacy-mobile

By: Yobo

Yobo — Fri, 27 Feb 2009 01:42:43 +0000

Excellent article. But if so much money is pouring into China still, why are there on the ground reports of a significant slow down in new deals this year?

By: “Smart Money” Explained : The Drama 2.0 Show

“Smart Money” Explained : The Drama 2.0 Show — Wed, 25 Feb 2009 08:56:14 +0000

[...] her first TechCrunch masterpiece, Lacy took almost 1,000 words to explain why VCs are increasingly looking abroad for opportunity. [...]

By: Nicolai Wadstrom on Entrepreneurship » Blog Archive » Post-financial crisis investments, where?

Tue, 24 Feb 2009 08:08:58 +0000

[...] the VC wandered outside of the Valley to find additional opportunities not found in Silicon Valley. Techcrunch artcile mentioned this last [...]

By: layendyangeks

layendyangeks — Mon, 23 Feb 2009 01:50:48 +0000

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By: some dummy

some dummy — Mon, 23 Feb 2009 00:37:38 +0000

I’ll tell you one thing. Silicon Valley doesn’t need to be too concerned about India right now. I have been doing business and working there for the past 10 years. Innovative they are not. Stealing ideas & copying they are good at (piracy rate on sellable software still hovers around 90% & the so-called software police do little but hurt the innovators, b/c small companies can’t do much with a $2,500 dev license. Thank goodness for open source or you’d see nothing innovative coming out of India).

The ITT’s have problems integrating teaching innovation b/c the professors don’t understand it.

The gov’t puts so many asinine restrictions on doing business there and corruption is rampant.

Ask job recruitees to do a forward thinking analysis (something simple, not like the full on interrogation they’d get at a place like Google) and most will not respond at all.

China on the other hand gets it. Yes, there is corruption and gov’t issues too, but they are POURING money into start-ups and innovation and supporting entrepreneurs with the latest & most sophisticated tools to work while the USA Is shuttering incubators left and right. China is the one we need to watch out overtaking Silicon Valley. India has the soldier-workers. Chinese have the ninja-workers and once they get the language barrier under control (India’s current asset other than labor, because doing business and all other costs are not cheap) they may well rule the world (and the children are being taught compulsory English in schools now). US still has the innovation/thought leaders but for how long?

By: Stuart

Stuart — Sun, 22 Feb 2009 23:18:40 +0000

I grew up in Silicon Valley, migrated to Australia in 1993 and cofounded a successful global internet company. It no longer matters where you live and work in the global economy, but it is the quality of your ideas and talent of your team that matter. The idea that a VC should only invest within driving distance of their office is backwards thinking. The only real advantage of being in Silicon Valley is funding is more available and there is a history of successful startups. However, the talent is quite diluted and expensive. There are many talented people that don’t want to live in Silicon Valley and there is a potential to achieve far higher returns investing in the best people with the best ideas regardless of where they choose to live.

By: Martin

Martin — Sun, 22 Feb 2009 21:02:04 +0000

Good comment. Sarah [her own words] moved to SF to be close to the Valley… Since then her lips have found many posteriors to be affixed to, including Arrington’s.
Fortunately, she will write for TC for only a few weeks… so, more fluffy crap is coming our way!

By: Marc’s Voice » Blog Archive » Mimi’s birthday blogging

Marc’s Voice » Blog Archive » Mimi’s birthday blogging — Sun, 22 Feb 2009 20:02:12 +0000

[...] This is the first smart thing I’ve ever heard Sarah Lacy say. Indeed VCs with any brains would be getting the hell OUT of Silly Valley and find themselves some smart dudes and dudesses around teh world. Or they could come out to Walnut Creek – but they would have to think different if they came to my house. [...]

By: Babu

Babu — Sun, 22 Feb 2009 19:43:28 +0000

Sarah,

Insightful article…

It is true that there are big opportunities in several non-tech sectors (Retail, Transportation, etc.) in emerging economies. But there are several challenges here:
+ These industries are mature
+ Big local conglomerates (e.g. Reliance in India) entering the market
+ Multinationals (e.g. Starbucks) entering the market
+ Relatively high capital requirements

Do you think even with these challenges there are opportunities to have a 10X return for in the traditional services/sectors?

By: Salim Mitha

Salim Mitha — Sun, 22 Feb 2009 18:53:29 +0000

Great post.

By: Jenny

Jenny — Sun, 22 Feb 2009 17:08:40 +0000

No, the co-founders of those companies, google and yahoo did not come from foreign countries, they were US born, so get over yourself. Your lies are no longer believed.

There was a Silicon Valley, long before there were substandard foreign workers who came there, and were funded by VC’s and wealthy parasites to take over and create fluff companies. The reason why so much of the newer technology/programs are so flawed and a bad value is because they are the results of a flood of substandard workers from India, China and elsewhere. It’s been shown that they are not innovators, they merely piggyback on what came before. We haven’t seen real innovation and quality since American citizens started being discriminated against in the workplace. I’m sure Sara Lacy is hoping that if she affixes her lips to the posteriors of the PT want to B, that she’ll curry favor with them, history shows that parasites like herself are doomed to failure.

By: Stick Fork in Venturebeat while you're at it

Stick Fork in Venturebeat while you're at it — Sun, 22 Feb 2009 16:24:51 +0000

VCs no longer being relevant, what’s the reason for Venturebeat staying afloat?

Those nitwits write about Xbox and games no one cares about.

They have lost their focus. They will shut down this year. Guaranteed!

By: links for 2009-02-22 | Yostivanich.com

links for 2009-02-22 | Yostivanich.com — Sun, 22 Feb 2009 14:04:08 +0000

[...] Why the Smart VCs Are Boarding their Jets Silicon Valley is not getting the same amount of VC funding that it was in the past especially compared to 9/11. (tags: usa economics economy siliconvalley vc startup business china india recession middleeast) [...]

By: LIVEdomainer

LIVEdomainer — Sun, 22 Feb 2009 01:21:12 +0000

yep..

By: Brian

Brian — Sun, 22 Feb 2009 00:03:56 +0000

Great article, Sarah.
I like your post much better than your interviews on Yahoo Finance; you should drop that gig and just write more. You’ll be much more loved !

By: joe

joe — Sat, 21 Feb 2009 22:54:40 +0000

I think there is a lot of potential in asia and china. But I hope that the USA can bounce back. We still have the best schools!

By: H1-B Visas Creating a Stir in the Down Economy « The goSwoop Blog

H1-B Visas Creating a Stir in the Down Economy « The goSwoop Blog — Sat, 21 Feb 2009 20:00:58 +0000

[...] the comments on the article from both sides of the table, quite a lot of colorful commentary). Sarah Lacy, finance writer for Tech Crunch, argues how those Americans choosing to take a [...]

By: WA

WA — Sat, 21 Feb 2009 15:54:27 +0000

I am a big believer in ‘The world is flat’ Take 2: the gobal recession and slow down in US growth would force China and India to mature in innovation, and eventually export innovation (rather OEM to US):

http://www.weal...-compared-2008/

By: A far away place

A far away place — Sat, 21 Feb 2009 14:07:12 +0000

I think you’re right about the local opportunity first Sarah. I certainly acknowledge that.

By: ReubenB

ReubenB — Sat, 21 Feb 2009 14:06:36 +0000

VCs need not fly much further than The Mississippi River and the Memphis airport if they are looking for opportunity. It’s brewing right here.

By: MC

MC — Sat, 21 Feb 2009 14:02:21 +0000

Mike D – I can’t believe how many facts you got wrong in one short paragraph.

Tax on investors in Canada is same or lower than US. when you go state by state and consider all the taxes. Corporate tax is lower than US today and will be half of the US level in 5 years based on Federal Canadian government projections.

Legal cost is same or lower nominally and with exchange rate is much lower.

Labour cost runs 20 to 50 percent lower than US on market-to-market comparables.

PR buzz, well that’s a competitive advantage of the Valley. Duh.

I’ve done this analysis, benchmarking all these costs for large IT services companies and start-ups so I can back up what I’m saying.

By: Jacques from Montreal

Jacques from Montreal — Sat, 21 Feb 2009 13:59:47 +0000

Left a comment yesterday – cant seem to find it…anyhoo

Nice and professional work here Mrs Lacey.

From where I stand, local VC ( Montreal – Quebec, yu know, the ‘other Canada’)) are mostly institutional (that’s quite a concept..!) or very much conservative, finally add the fact that there is a language difference…

So, I find myself thinking that my startup-to-be is at par risk wise with what can be fiund in India (minus the 1.3 billion contrymen

By: Brett

Brett — Sat, 21 Feb 2009 13:38:30 +0000

Thanks for taking the time to comment Alistair. I agree – culture is important. We have a small tribe here, the Lemba, they can follow their traditions back to pre-Mesopotamia days – that’s impressive. Money that overruns culture is just badly thought out, and will get lost. But on the other hand, culture that refuses to improve lives – not in a western sense, but a basic needs sense – also needs to re-evaluated.
Your example of Kenyan hospital probably should’ve just made allowances for traditional healers and then it would’ve been fine: throw the bones and get X-Rays at the same time…
A VC could do incredibly well here with eco-friendly, low-cost housing. We have the space, the people, the sun, and the materials. UCT (University of Cape Town) has already had some success building on the Cape Flats with unusual materials for less than traditional building costs. Combine that with solar and wireless broadband and you’re doing something interesting – for those that want it. But, who out there doesn’t want a house, TV, phone, music, etc?