Silicon Valley – the promised land of innovation, venture capital, and exorbitant costs of living. And many of the most valuable companies from the region, such as Square, Stripe, Airbnb, Uber are all based in the city of San Francisco.
Increasingly, however, it’s hard for startups to compete in the market for talent in the infamously expensive city of San Francisco.
In March 2017, a blog post by Zapier CEO, Wade Foster, announced they would offer a $10,000 “De-Location Package” to employees that would move out of San Francisco. Fintech startup Varo Money announced in July that they plan to move their headquarters from San Francisco to Salt Lake City, citing high home prices among other reasons.
We decided to analyze whether startups based in San Francisco actually had offices elsewhere as well. Are companies located in the city for fundraising and marketing purposes, but also creating offices in other cities and countries? Is this phenomenon limited later stage companies only or are early stage companies saving costs this way too?
We took a look at the startups headquartered in San Francisco to determine if and when they expand to locations in other regions and where those regions are. Specifically, we pulled data on the 903 companies headquartered in San Francisco that have more than $5 million in funding from our Craft dataset of companies and their locations.
We found that 38% of San Francisco tech companies companies had locations elsewhere – with New York as the top U.S. city for an additional location and the U.K. as the top country for an additional location. Even for early stage startups (defined as raising $5-10MM in this analysis), 21% of San Francisco companies also had offices elsewhere.
For context, the table below shows the distribution of these startups in buckets based on total funding that we will use for this analysis.
As one might expect, there are far more startups in SF with less than $50 million in funding than there are those with more than $500 million in funding. While many startups aspire to be the next Uber or Airbnb, the distribution is heavily skewed towards those with lower amounts of funding.
To begin, we analyzed the distribution of companies that have solely their San Francisco location and those that have office locations outside of San Francisco. Of the 903 companies that fit our criteria, 339 startups (roughly 38%) have locations outside of San Francisco, which means that 564 of companies only have their primary SF office. See the companies with locations outside of San Francisco here.
We then categorized companies by funding amount to see if there is a relationship between the amount of funding a startup has received and whether they have expanded to office locations outside of San Francisco. Our hypothesis was that companies with more funding have more capabilities to expand into new and potentially lower cost locations but we wanted to see if smaller, earlier-stage companies also had offices elsewhere. The graphical display of these two distributions clearly show that as the funding amount increases, the percentage of companies that have office locations outside of San Francisco increases, while the inverse (companies with only their San Francisco location) decreases.
Soros Newest Investor Of Tesla Bonds
Tesla looks to have a new bond holder and it’s none other than George Soros. Whatever this mean, Soros has also taken a stake in Crypto-Currencies .
Zerohedge Reports: Amid Elon Musk’s darkest hour in late March – as his stocks and bonds tumbled in price – it seems there was at least one other billionaire willing to buy the ‘blood on the street’.
According to the latest 13Fs, George Soros’ investment firm took a $35 million stake in Tesla’s convertible bonds during the first three months of the year.
As a reminder, convertibles are hybrid securities, either bonds or preferred stock, that can be exchanged for a predetermined number of common shares. That effectively lets an investor participate in stock-price changes, but with the yield and greater security of a fixed-income instrument.
The March 2019 Converts bounced handsomely off those lows – tracking the stock’s divergent bounce – but in recent days has fallen back towards the lows, catching down to the straight bonds record low price.
“Racial Bias Education Day” To Close Down Starbucks Nationwide
Starbucks is going to the illogical extreme by taking an entire day to put their employees through what they call “Racial Bias Education Day”. Coming after a viral videos showed two men being arrested in a Starbucks in Philadelphia. Starbucks almost instantly gave into calls to do ‘something’ but will this really fix anything in a culture where ‘racism’ is more of a political talking point than an actual substantive conversation or debate.
CNBC Reports: Starbucks said Tuesday it will be closing all of its company-owned restaurants in the U.S. during the afternoon of May 29 to conduct a racial-bias education program.
“I’ve spent the last few days in Philadelphia with my leadership team listening to the community, learning what we did wrong and the steps we need to take to fix it,” Kevin Johnson, CEO of Starbucks, said in a statement Tuesday. “While this is not limited to Starbucks, we’re committed to being a part of the solution. Closing our stores for racial bias training is just one step in a journey that requires dedication from every level of our company and partnerships in our local communities.”
Soros Now Investing In Crypto-Currencies
After a historic drop in cryptocurrency prices in the first quarter, one which deflated much of the euphoria that surrounded the sector in late 2017 and the start of this year, the space is about to get exciting again because none other than 87-year-old billionaire George Soros is reportedly preparing to trade cryptocurrencies as prices plunge.
According to Bloomberg, Adam Fisher -who oversees macro investing at New York-based Soros Fund Management – has received internal approval to trade virtual coins in the last few months, “though he has yet to make a wager.”
The question, of course, is whether Bloomberg’s leak is accurate, and if indeed Soros is only now getting started in the space or if he has quietly loaded up already.
What is ironic, is that just three months ago when speaking at the World Economic Forum in Davos, Soros said digital coins cannot function as actual currencies because of their volatility, “but he didn’t predict the hard tumble that some observers had forecast at the time.”
“As long as you have dictatorships on the rise you will have a different ending, because the rulers in those countries will turn to Bitcoin to build a nest egg abroad,” Soros, 87, said on Jan. 25.
With Bitcoin tumbling below $7000 recently…