Startup leaders are the driving force behind the entrepreneurial culture in every city. They develop new initiatives to inspire entrepreneurship and provide guidance to the exhilarating startup madness. Without startup leaders to organize structure with the various ecosystem components, entrepreneurship would not be able to thrive in a city.
For this reason, The Founder Institute has gathered our expansive network of global directors to share their valuable insights into each of their specific startup ecosystems. In this installment of Director’s Chair, we’ve asked FI San Francisco Fall 2015 Director, Ben Larson, to share his thoughts on SF’s secrets to startup success as a premier innovative hub for entrepreneurs.
How has your entrepreneurial background prepared you to lead a startup ecosystem like San Francisco?
I have made the leap from being an employee in a corporate structure, unrelated to technology, to becoming a tech entrepreneur. I have experienced the process of failure, learning, building my network and everything that goes along with that. By building my own companies, interacting with other founders building their companies, and doing consulting, I've learned the lessons that we now teach in a structured manner. I also know the consequences of not following through with some of the methodologies that we teach.
I truly believe and have witnessed that anything can be achieved with enough passion and hustle. Anything is possible in this industry, especially in Silicon Valley." - Ben Larson, San Francisco Director Fall 2015 @pitchtoben
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There's a lot of great talent in San Francisco, what started & established San Francisco to be one of the leading startup ecosystems around the world?
Number one, is the culture of sharing and mentorship. Number two, the reduction in the fear of failure. The willingness to fail is celebrated here. These are two main barriers we see that occur in other countries around the world. There may be shame associated when you fail at your company. Learning information is isolated elsewhere, and not as easily shared as here in San Francisco. Other cultures are starting to adopt these mentalities but SV is still at the forefront of this movement.
San Francisco has the unique advantage of geography. It is a small space, there are a ton of tech companies co-located in a small area. The ability for people to go from office to office and meet during lunch is very easy. When I just started out, it was very easy for me to move around and meet different people. If you are driving around the valley, it is not as easy to access companies.
How do you see the startup community in San Francisco evolving in the next 20 years? What will change and stay the same?
There is definitely a movement right now in the co-working and incubation space. It’s these ancillary services that are housing young startups that are booming. This is further lowering the barrier. You will see people from different industries starting their own companies. There is this boom in entrepreneurship in general. Technology being involved in that helps boost the entrepreneurial boom.
San Francisco has a very interesting and unique culture. The drive for excellence and the 24/7 mentality of building these companies is very prevalent. San Francisco sometimes get criticized for the Peter Pan syndrome. People as they get older still feel younger. They focus on their work a lot more fervently. I think that mentality will stay. In some sense, it gives a competitive advantage to companies starting their journey in San Francisco, because there is that constant drive to get things done. Whereas elsewhere, people might work hard, but there is a division between work and home. In SF, people practically live in their offices.
What short- and long-term strategies will attract entrepreneurs and start-ups to stay in San Francisco?
Short Term Strategies - Complementary lifestyle and creativity that is bred throughout the city. You get constantly inspired and challenged by these entrepreneurs everywhere you go. That will only continue to grow. It’s great for talent acquisition, growing a creative team, and bringing on young talent.
There is a tendency for employees to be fairly fluid, they are moving from team to team looking for the best opportunity possible. As you grow, it becomes a very expensive place to be. Being able to support large teams and providing the services these teams desire is going to be difficult. There are a couple pillars in SF that are big, like Twitter, but those have required major tax breaks to keep them interested. I don’t see that lasting.
Long Term Strategies - It is going to take tax breaks, because commercial real estate in the city is out of control. What is more important is for companies to be more versed in doing distributed work forces. Being able to have your headquarters in the city, but having ancillary offices elsewhere. That is what Uber is doing, their headquarters is in SF, but a large part of their workforce is in Oakland.
Given the current state of your local economy, what obstacles or challenges do you currently face in your startup ecosystem?
I am concerned more about the future challenges. The cost of living in the city is very high. Companies are being valued very highly. They are giving young employees high salaries, so they are driving up the cost of living. A young employee doesn’t think twice about putting 50% of salary towards rent. Which causes a challenge when there is a shift in the economy and company valuations get reduced or fundings gets reduced, and this standard of living cannot be supported. Alternatively if it continues, the city as a ecosystem gets challenged. The tech companies are at odds with the long term residents in the city.
Why do you feel it's rewarding to be an FI Director?
It’s especially rewarding to me because I am able to take the lessons I have learned and help other people embark on the journey that I myself went on. If I can make it easier, and allow them to achieve that next level of success, then it is a way for me to give back. There is really nothing greater than enabling someone to succeed and achieve their potential.
"In the last 4 months we were emerged in the learning and development program consisted of 4 stages: Idea & Customer Development; Company & Team Formation; Product Development & Distribution; Go-To-Market, Bootstrapping, & Fundraising; We have a valuable idea and understanding of how to pursue our vision now." - Evolutics Technologies, San Francisco Fall 2015 Alumni
"The biggest value came from the mentor reviews, who gave us the first accreditation that our ideas are actually valuable and viable. Throughout the program, we received help from experienced mentors to achieve our goals. FI is something that every entrepreneur should try to get supercharged and push for the full success of their company." - LiberEye, San Francisco Fall 2015 Alumni
What is the best piece of advice you've received about mentoring entrepreneurs?
Understand that you are not your idea. When you are creating a company, your purpose is to solve someone else’s problem and create value." - Ben Larson, San Francisco Director Fall 2015 @pitchtoben
Your idea is merely an inspiration, and what you want to do is solve that problem that your idea is built around. So even if your idea is changing, as long as you are solving the problem, you are doing the right thing. It’s the entrepreneurs that are married to the idea that might fail because they are blind to what the actual needs of their customers are.
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