I mean. Please fill me in someone; what does New York have – that no other place have – that seems essential to become a Valley-like centre of tech?

I think a little bit of history of the Valley may help. I am comfortable assuming that the Valley was a lot of things before it became “the Valley”, but it certainly was not a big apple.

The next tech-center could and should start somewhere else. The big apple is already a big apple. Let the next tech-center start and blossom elsewhere.

So, until that happens, it's important for entrepreneurs to just keep their heads down focusing on their startup and hopefully helping the area get to the point where there are a couple of big exits to help juice the investment scene.

I actually got inspired by this and wrote a blog post with some more of my thoughts on the Raleigh tech scene and what it'll take to get to the level of the others':http://clayschossow.com/2010/03/the-venture-capital-scen-for-tech-startups-i-the-raleigh-durham-area/

My original post was really just me reflecting on the NYC scene as it relates to startups in my position and thinking through whether I should stay here or follow the advice of my mentor, Seth Sternberg the Founder of Meebo, and head West.

After my original post, Eric Weisen of RRE (awesome dude) sent me a Tweet: “The grass is always greener.” And so I'm heading to Cali to test the hypothesis. I'm as curious as anyone to see how it shakes out.

Expect me to report back my findings.

In order to see investors take risks in concepts that “to try to change the world” rather than just “incremental money on incremental technologies” we are going to need to see some successes on the smaller side to be more comfortable taking that risk. i.e. we need to walk before we run in ny and i believe we are on the right path.

Good point. Though if we all carry a bit of the weight, moving forward would be easier.

I must admit, however, to considering a move to NoCal myself. My start-up is 20 days old, and already I feel behind; I can't help thinking that were I in SV or nearby, it would be much further down the road, due to the resources available to first-timers there.

That said, my little company is what it is because NYC “introduced” me to Matt (who suggested the hook which pulled all of the pieces to together). I've also begun work with NYTMI & Mouse.org that I don't care to abandon. Maybe I'm crazy, but carrying my bit of weight and working on my start-up have not interfered with one another, thus far…

I hope it stays that way because in the end, as you've said here, I have to do what's best for my “baby”.

Should a good VC be working to fund ideas that change the world? Yes. Should they also be looking to back young companies working on important problems that are, say, built on top of something else and very useful but not transformational? I'd say so. There are lots of start-ups of value that will never be the next Google, Twitter, Microsoft or Apple, but that doesn't mean they shouldn't be funded and nurtured as any start-up should. If one were to apply the “change the world” mission to venture investing, the amount of capital being invested in such companies (or even that should be invested in such companies) is probably less than 20%. To me the key is making sure that those 20% or so get the requisite support and time to thrive from their venture backers, which is the much bigger issue at hand.

I'd like to think that I back worthwhile start-ups and am very entrepreneur-friendly without all that negative financial engineering you ascribe to certain East Coast VCs, but do most of my portfolio companies have a change to change the world? Not in the way I define changing the world. And personally, I'm ok with this. I'm helping to create useful products, create jobs, and foster entrepreneurial excitement and possibilities. This is what venture investing means to me.

As it relates to large West Coast VCs, many of these firms are structurally bound to trying to change the world because they need those kinds of wins to return their funds. This doesn't make them paragons of virtue; it makes them rational. But buying this series of far out-of-the-money call options has an ugly dark side as well: if companies don't appear to have the potential to change the world (read: sell for $1 billion+, go public, etc.), they often get squashed and orphaned since they are no longer worth the VCs time. Now I'm painting with a broad brush here but you get the point. Does this dynamic help create a favorable entrepreneurial culture? Is this approach really making the world a better place? Not to me. Plenty of companies that would have made it on the East Coast will fail on the West Coast precisely because of the need to hit home runs to the exclusions of singles, doubles and triples.

Chris, I certainly agree that those investors who are heavily focused on metrics and traction are noxious and ill-placed as seed stage investors (they are really Series B, C and D investors). However, I would say that entrepreneurs who combine vision with pragmatism are more attractive to me than entrepreneurs who simply have vision. Might this pragmatism keep the starry-eyed entrepreneur from changing the world, and only building a really large, successful company? Yes. Is this necessarily an indictment on the NY VC reputation of wanting to understand plans for commercialization even in pre-revenue companies? I don't think so.

Thanks for penning this, Chris. You've raised some really important points that warrant discussion.

Roger

If I needed 100k worth of resources to risk on developing information processing tools I may not have started.

Anyway – another post you've knocked out of the park….*bowing* I am not worthy…*bowing* I am not worthy