In the textbook university town of Ann Arbor, Michigan, two former automotive engineers now boast of their abilities to live life within a few city blocks:
And if Ann Arbor filled Gauri Thergaonkar and Giri Iyengar's need for community when they were at Ford, it became an even more obvious choice in 2003 and 2004 when they both left Ford, capitalized on their love of good food and wine, and traded vocation for avocation.
"Thergaonkar jokes that she lives her life within four blocks, and if she and Iyengar didn't have to venture outside of downtown to buy certain necessities - like toilet paper - it would probably be accurate. The neighborhood feeling reminds Thergaonkar of her childhood neighborhood in Bombay, India – the familiarity with people you see every day, the neighborhood grocery, the continuity of old, established businesses.
"This is a place that had the feeling of community," she said. "I think Giri and I were sort of both seeking the same thing - that sense of having neighbors…I feel like this is my neighborhood; these are my people. I realized that I never really missed it until I got it back....Every time we actually considered doing anything different, it was 'Where do you want to be when you walk out the door?'" Thergaonkar said.
The compact spatial dimension of the couple's daily lives is made possible by the mix of uses available to them within a small radius of their home, and as such they rarely need to travel elsewhere. In a 2006 article I've long wanted to mention here, the NYTimes details how the importance of such proximity in another setting is ultimately compounded--not weakened--by the global spread of network technology:
Fiber networks cross the world. Data bits move at light speed. The globe has been flattened, and national boundaries obliterated. Yet in Silicon Valley, the one place that is responsible more than any other for creating the network technology that supposedly renders geography irrelevant, physical distance is very much on the minds of the investors who provide venture capital.
Meet the “20-minute rule” that guides fateful decisions in Silicon Valley. Craig Johnson, managing director of Concept2Company Ventures, a venture capital firm in Palo Alto, Calif., who has 30 years of experience in early-stage financings, said he knew many venture capitalists who adhered to this doctrine: if a start-up company seeking venture capital is not within a 20-minute drive of the venture firm’s offices, it will not be funded....
YouTube and Google share the same source of venture financing: Sequoia Capital, situated among the venture capital firms clustered in a handful of blocks in office parks along Sand Hill Road in Menlo Park, near the Stanford campus. Google’s other source of venture capital, Kleiner Perkins Caufield & Byers, is nearby, too. Sequoia makes its preference for the 20-minute rule almost explicit, telling applicants whose companies are at the “seed stage” (receiving less than $1 million) or “early stage” ($1 million to $10 million) that “it is helpful if the company is close to our offices” because they “require very frequent contact.”
That frequent contact is not that dissimilar from that which Thergaonkar and Iyengar experience in Ann Arbor's downtown. For them, the end product of the overlap of their professional and personal lives is peace of mind; for the venture capitalists, it's money. So proximity yields profit in multiple forms.
It's worth mentioning that the "nature" of this proximity is really quite complex, dependent on the interrelationships of many, many players:
Entrepreneurs who live in Silicon Valley also find the technical talent they need faster than they can in any other place; they pay more for that talent, but speed is the sine qua non for success. Seth J. Sternberg, the chief executive of Meebo, an instant-messaging company in Palo Alto that is backed by Sequoia, described Silicon Valley with the fervent appreciation of a recent transplant from New York, where he had suffered three separate bad experiences with start-ups, none of which had attracted venture funding.
The ecosystem in Silicon Valley, Mr. Sternberg said, includes “incredible techies, who live here because this is the epicenter, where they can find the most interesting projects to work on.” The ecosystem also includes real estate agents, accountants, head hunters and lawyers who understand an entrepreneur’s situation — that is, emptied bank accounts and maxed-out credit cards.
How do these "ecosystems" bear themselves out in physical form? Logically, mobility is centrally important, which underlines the need for efficient transit networks, as well as walkability:
The common thread in communities that are now drawing the entrepreneurial, 25-40-year-olds, says University of Michigan architecture and urban design professor Christopher B. Leinberger, is walkable urbanism. "From an urban planning point of view it means a place where, within a quarter-mile to a half-mile radius, you can get pretty much everything you need and maybe even walk to work," said Leinberger.
Indeed, the 20-minute rule is circumscribed by the frequent traffic problems of Silicon Valley (no one's example of walkable urbanism), though this is considered a necessary trade-off:
Even if the process goes smoothly and requires only 15 meetings — the fewest possible, given the lowest range of possibilities — and even if most of those meetings are set up in advance, the time consumed in getting to Sand Hill Road, even using local highways, can be significant. The problem is that much worse when, as often happens, a meeting is called with just an hour or two of notice. “If you live in Santa Clara, it’s doable,” Mr. Morgan said. “If you live in Dubuque, it’s not.”
Many entrepreneurs see themselves someday as becoming venture capitalists because they think the venture capitalists are the people with all the money. Indeed, over time many of them have made a huge killing and many have lost a small fortune.
Posted by: Lewis | 09/12/2007 at 05:29