How American are Startups? Paul Graham

Cities are no longer dependent on geography, but on people.

Who are the right people and how do you get them to move there?

Rich people and nerds.

Do we really need rich people, couldn’t the government fund startups?

Government bureaucrats funding startups would be like having mathematicians editing Vogue or, more accurately, the editors of Vogue running a maths journal.

How can you attract the right people? Universities, or at least strong computer science departments, are key. You need strong faculty.

The city needs other attractions. It needs to be an air hub. The creative class like small, independent stores not chain stores and large developments.

Nerds like a town where people smile. Quiet cafes instead of noisy clubs. Used bookshops instead of fashion stores. Open space instead of tower blocks.

Young people need a town with an intact centre.

The US has (ten) significant advantages:

1. The US allows immigration
2. The US is not a poor country
3. The US is not yet a police state
4. American universities are better
5. You can fire people
6. In America work is less identified with employment
7. America is not too fussy
8. America has a huge domestic market
9. America has venture capital
10. America has dynamic typing for careers

How to do better

• Constrain the amount of land available, ban large developments, avoid sprawl.
• Better public transport — design the town for cycling, buses and walking.
• Lower capital gains tax. Belgium has a capital gains tax of zero.
• Smarter immigration policy. Become a Mecca for smart people simply by letting them in.

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