By Kulveer Taggar
Chief executive, Auctomatic
Kulveer Taggar moved to Silicon Valley in California after graduating from Oxford and working as an investment banker. He explains why California is the place for those with entrepreneurial spirits.
The spirit of co-operation is strong, says Kulveer Taggar
A few weeks ago, I went to a house party in downtown San Francisco with my business partner, Harjeet.
We were talking to someone about our start-up (Boso.com - an online trading site), when Harjeet proceeded to have a huge rant about how Facebook was really restrictive for outside developers, and that it didn't let us do the things we wanted to.
At the end of his rant, Harjeet hesitated and asked, "So, are you familiar with Facebook?", and the reply came, "Yep...I work there".
We were momentarily horrified, but it all worked out OK.
That chance conversation has led to a meeting with one of their technical heads and an invitation to their offices, which is very cool.
That sort of sums up why I wanted to move out here.
By being based in London as an internet entrepreneur, you exclude yourself from all the chance meetings that take place in Silicon Valley, and it's definitely an understatement to say that internet business is based as much on who you know as what you know.
Living the dream
To put this into context, I left my investment banking job months after graduating from Oxford to try and live the entrepreneurial dream.
But things were tough, for several reasons.
London is especially hard for internet start-ups because it is expensive.
When we flew to Boston for our interview with venture capitalists Y Combinator, I remember noting that the cost of travel to the airport in the UK was about four or five times what we had to pay in the US for the equivalent.
And this is not to mention all the other associated costs of doing business - such as rent, professional fees, salaries and so on.
Competing for talent
You also have to compete for the best talent with the big banks, law and consultancy firms.
I'm particularly sensitive to this point, because we lost our most talented and promising intern to a consultancy, after he'd worked with us since April and had made a big impact.
We can't offer the same security that a big firm can, but out here the attitude amongst graduates is different.
It seems that the very best actively seek out to join start-ups.
I'm sure that's reinforced because at places like Stanford University, in Silicon Valley, you are constantly reminded about all the start-ups that formed there and made it really big, with Google being a prime example.
Talking about attitudes, it was funny to observe at that same party I mentioned earlier, how a McKinsey consultant bit his lip when he told me what he did - as if he felt guilty about it.
In London, it's deemed one of the most prestigious and impressive things to do.
Back home consultants, bankers and lawyers wore their jobs as badges of honour, and I'd hesitate to tell people I was an entrepreneur.
Finally, trying to raise investment for an internet start-up is infinitely harder in London.
I remember drafting a heated blog post about this out of frustration in the summer, but I was talked out of publishing it.
The risk appetite amongst British investors is low, and it was also frustrating that I often ended up educating investors about the internet in general.
The opportunity cost of that time is of serious consequence to all British technology entrepreneurs, and puts us behind our American peers.
So far, the decision to relocate has been an excellent one.
It had actually been on my mind ever since a trip here in May 2006, when I was filming a documentary for Channel 4 and was able to meet Evan Williams, the founder of Blogger.com.
We're now working in the offices of his new venture, Obvious.com, and I couldn't think of an environment better suited to a start up.
The spirit of co-operation is strong.
"Networking" isn't something that has to be organised or encouraged, it just happens.
The weather is great and the vibe is friendly, optimistic and ambitious!
Big thinking is encouraged and not frowned upon as is sometimes the case in London.
Ultimately, Silicon Valley is a great place to start a company because there is more capital, a bigger talent pool , and because the most important companies and people are here.
Ignoring for a moment how this came to be, now that it has, positive network effects have kicked in, and it has become a self-perpetuating virtuous cycle in terms of attracting future entrepreneurs and capital.
I also definitely think there is something to the co-operative environment here that helps people be successful.
Again, it may have come about by chance, but now that this norm has been established, all newcomers adhere to it and it persists - and it may be nothing more complicated than that.
Next month: how the business is developing compared with what we expected.