Valleyboys: It's All About the Money

Late last night I was finishing up a presentation for a class I’m taking when Jeremiah Owyang from Forrester made a statement on Twitter which made me cringe. The statement, though profound to someone living in the heart of Silicon Valley, is completely absent any reason to the observer outside of the Valley. Keep in mind the Parable of the Three Bloggers as I quote him.


We work really hard in Silicon Valley, why? It’s not the money (only a few strike it ‘rich’) I think it’s the passion for creating new

Someone should remind Jeremiah of the 140 character limit of Twitter. ;)

I take a lot of exception to this statement because it is exceptionally wrong. Not only exceptionally wrong, but naive.

First of all, as an insider it’s easy to say everyone is just working to create and innovate. While that’s true to a certain extent, it was much more true two years ago. As the outsider to the Valley that I am, I’d say the Valley is one of four North American hotspots for money flow – Boston, New York, Canada (Toronto) and the Valley.

That places these four locations on the map as one of the four places every entrepreneur in North America wants to be. The reason why DEMO and TechCrunch 40 were so successful is because entrepreneurs want money!

Yes, they need money. This is true. But the drive for more money is beyond what it was when the interactive web was in its infancy and companies really were sprouting up because people wanted to work passionately on a project. They discovered some idea and the technology had matured enough that the idea could be pursued.

Today, we are talking about San Francisco-based Automattic valuating at numbers well in excess of $200M, Palo Alto-based Facebook (along with some fuzzy math) weighing in at some $15B. GigaOmniMedia, the parent company of GigaOm and the rest of Om Malik’s empire getting $1M+ for hardware, or something…

Everyday, new companies are being funded and it’s mostly in the Valley.

I love the Valley. I love the entrepreneurs in the Valley. I wish I was there living but no job has taken me there yet. But it’s a very introspective and naive thought to believe that the Valley is full of people who just are passionate. Yes, passionate people make the best companies. That I will not argue with. I think there is more passion to get the big exit than to build a solid product.

I could be wrong. Feel free to correct me. ;-)

10 Replies to “Valleyboys: It's All About the Money”

  1. In those companies you mentioned, how many of those employees will make it wealthy so they can stop working? I’ll bet it’s limited to many of the founders and early employees.

    Innovation drives this hunger, not all inventors are trying to ‘get rich’.

    Also, take the rest of my tweets into context (before and after the one you selected). I’m from Silicon Valley but am in Barcelona right now, and the quality of life is nearly the same, yet people aren’t stressing to work so hard. It’s a pretty clear distinction.

    Secondly, I’ve heard tech folks say, if they wanted to be wealthy, they’d have gone into finance.

  2. Being a Boston guy, I guess that puts me in one of your four hot spots. Was Jeremiah really saying it’s not about the money at all? I don;t think so, but that’s the thing with Twitter and 140 character limits– sometimes full meanings don;t get explained- but it does prevent us from rambling like I am here.

    I’m not even convinced you two are in complete disagreement here. The truth probably lies in the middle: I’m not cynical enough to believe everyone is in it just for the money, but is the “exit strategy” the #1 thing in alot of cases? Yes– whether it is driven by the entrepreneur/innovator or the people brought on board to raise the money you need in the first place.

    One thing I haven’t seen yet is the crazy stupid money and lack of rationality we had in 1999– we’re not even close to that yet. Wait for the $20m A rounds, then we’re getting nuts. Pass the Kool-Aid…

  3. As anywhere, “The Valley” has a handful of exceptional people, but as anywhere, the population majority is out for the $, ineffectual, and pretty darn average. As for new, I haven’t seen anything truly new in a long time. What is new is how people are responding to some fairly bland materially inconsequential offerings.

  4. Well, I don’t live in the valley. Been there once. But I’d say that the passion to create something (a passion which often needs money) is the initial driving force. Then the passion for money itself kicks in.

    That seems to be the case everywhere, only in the Valley, it’s on steroids.

    In the Valley, it seems as if there is a culture of innovation that you don’t see elsewhere. Or it you do, it isn’t as prevelant.

    Now when Jeremiah says “It’s not the money…” his idealism may be outweighing logic. Because money is behind everything. Afterall, 4 year olds (and twelve year olds) have to eat.

  5. I don’t think it has anything to do with motivation as much as it does with opportunity.

    The Valley has lots of money. The Valley has lots of smart people. Both of those (in abundance) are ingredients for great products.

    Other places might have money, still others might have smart people. But it’s the places where these come together (Seattle’s another place) where you get all this innovation.


  6. I think it started off with a very few idealists who end up striking it rich almost by accident; afterwards everyone else swoops in and tries to get their piece of the pie.

  7. Money is merely a utility for enhancing growth. SV is not about the money…though as a “utility” its plentiful…its about the people and the culture they’ve created. Those seeking to locate in SV, NYC, Toronto or Boston (or any other perceived “money” center) for the sake of money are locating for the wrong reason. You can locate in Pittsburgh or San Antonio or Anchorage or Mumbai – the important thing is: where do you feel comfortable, where does your family want to be? If you’ve found that place, that’s the place to be: people and money can come to you. SV provides an awesome place to live (I lived in San Mateo for two years while working in SF’s financial district), with awesome resources…but this web environment, and the ability to communicate allows for where you want to be, to be the place to be. :-)


  8. I lived in the Bay area for three years(2002-2005), and worked in the Valley. As someone from the outside, who honestly hated California, I still can’t argue that it’s all about the Benjamins there. I think it’s about significance. People want to start the ‘next big thing’, whether or not that brings in riches. The Valley didn’t seem more money driven than Salt Lake, Boston, SF itself, or anywhere else I’ve spent a lot of time.

  9. As much as I love to disagree with Jeremiah :-) I have to go with him on this one. I’ve worked in the Valley for 24 years and have seen way more people working hard than people getting rich. So why do we do this? Fun is part of it. Change, newness, importance are part of it too. Sure, we wouldn’t mind getting stupid rich but the odds are against us.

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