No Startup Community is an Island

Prior to Adam Smith's Wealth of Nations, people had really weird ideas about how to grow an economy. They didn’t understand that trade (i.e. exchange between communities) was the great creator of wealth and prosperity. Instead, mercantilism and isolationism prospered. People tried to hold on to things like gold and created tariffs to protect local industries.

Today, there is a common misconception among those building startup communities that parallels this antiquated view. Some people seem to believe that one community wins and another loses. This zero-sum perspective reflects an "us versus them" mentality.

It is actually how city economic development departments work. Cities have teams that go out and try to "win" companies. The Amazon HQ2 initiative is a great example. There are winners and losers as cities fight each other to get a finite resource.

I think that’s completely backward for New Economy jobs and doesn't work to build a startup economy.

There is actually enormous power in networks. The real magic happens when you build bridges to outside startup communities, making the whole more powerful and benefiting each node.

Austin currently has about 14 daily flights to the San Francisco bay area. San Antonio has 3. The result is that Austin’s tech community is much more tightly integrated and appealing to companies that are already part of the global startup community.

One last point: the kind of growth that comes from natural connections is more lasting than artificially created additions to a startup community. Of all the times when people have paid to have startups relocate to one city at the cost of another city, I've seen it go wrong more than it’s gone right. When it happens organically, that’s when it seems to stick.

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