Start your startup in Kansas City, or Vietnam

Submitted by tomo on February 15, 2013 - 1:02pm

Boulder's big VC investor dude Brad Feld has a house in Kansas City now. He doesn't live there, even for just part of the year, but he owns it. He's letting YOU live there. For free. FREE!!! But should you live in Kansas City (a mid-sized town in the American southwest midwestern state of Missouri) to bootstrap your startup? If the rent is free?

Awhile back I talked about bootstrapping your startup in Ho Chi Minh City on the cheap. And what's better than cheap besides free?

There could be other considerations for where you locate your startup. Maybe Google's gigabit fiber internet connection to houses in Kansas City's "fiberhood" will entice you. Google wired up one down-and-out American city with relatively superfast (compared to the average American internet connection) internets. And they did so for a reason, believing that something interesting, and socially good, will come out of this experiment.

Brad Feld is betting that high speed internet will be a catalyst for valuable startup creation, combined with free rent.

But I think you're better off bootstrapping your startup in Vietnam.

First, there are already startups in Vietnam (both in Saigon and Hanoi, but Saigon is where the action is). They serve both the domestic and international market and they are started by local Vietnamese, international Vietnamese, and foreigners from other Asian countries, from English-speaking countries, from Europe, etc. You'll find yourself in a small but active community of English-speaking entrepreneurs with meeting places, thousands of cafes, and regular startup events. The backgrounds of your peers will be an order of magnitude more diverse than in Kansas City. And the rest of the city isn't just full of white (really, really white) people.

Next, free rent is nice for the handful of people who a) want to relocate to Kansas City and b) got into Brad Feld's house. I'm not offering free rent in Saigon. But I can guarantee you really cheap rent. And cheap food. And you won't need to buy a car and fill it with gas. And you won't need car insurance. In fact, you won't be required to buy any kind of insurance, which also makes hiring people that much cheaper when the time comes. Your rent in Vietnam might be cheaper than your car insurance in Kansas City. TCO, Total Cost of Ownership, means your "free rent" in Kansas City is still going to cost you more than bootstrapping abroad. Free rent is only nice compared to $2000 for a single person in the valley. Rent is already cheap in Kansas City if you truly believe the value is there.

To their credit, KC's Google Fiberhood does offer really fast internet. Internet so fast you'll be waiting for the other side to server you data rather than the server waiting for the data you requested to trickle back down your pipes. Well, it will still be clogged in a pipe somewhere, just not in Kansas (Missouri, whatever).

Your average internet connection in Vietnam will be nowhere near the theoretical speed of a gigabit internet connection. In fact, the entire southern portion of this country would probably struggle to max out a connection to a fiberhouse in KC. Downloading porn in Vietnam takes much longer (but you'll need to watch more porn in Kansas City, hahaha). Sometimes it's faster (and more convenient) to drive to the store to buy a pirated movie. Technology companies need internet connections. But they generally need them to be reliable, to serve web pages in not too many more seconds than it takes to render them, and for YouTube to stream without too many hiccups. Internet speeds in Korea or Japan are already orders of magnitudes faster than in Vietnam. But I have never heard a startup founder lament that they should move their company to any other country in order to take advantage of faster internet speeds. Beyond a fairly low threshold, as long as the connection is stable, it mostly doesn't matter. Increasing the speed tenfold doesn't confer a tenfold competitive advantage. There are a lot of much more important factors.

And the biggest reason for choosing Vietnam over Kansas City or Chattanooga or Baltimore or any other third-tier American city: Living in Vietnam is way more fun. I've lived in four Midwestern cities and I know they can be fun at times. But for a young person, for a single guy, for anyone under the age of 50 who isn't crippled, for white/black/brown/yellow people, for anyone who might want to do anything more than take their children to the local Bob Evans, Vietnam is going to be fun and Kansas City, in comparison, is going to seem like a ghost town.

So choose Bali, Bangkok, Jakarta, Hanoi, or Saigon to slow your startup's burn rate while being inspired to live (and code). Don't try this in Myanmar yet - there's a real difference between slow internet and expensive, unstable, unusable internet. Avoid Singapore because it's just as expensive at Silicon Valley without all the benefits of being in the Valley.

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Patsy Ruble (not verified)

They serve both the domestic and international market and they are started by local Vietnamese, international Vietnamese, and foreigners from other Asian countries

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Patsy Ruble (not verified)

They serve both the domestic and international market and they are started by local Vietnamese, international Vietnamese, and foreigners from other Asian countries

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Florida Accountant (not verified)

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