Silicon Valley, Silicon Alley And Henry

Last week I was fortunate to meet with start-ups on both the East Coast as well as the West Coast — in other words, Silicon Alley followed by Silicon Valley.

One of the interesting things I noticed is that both sides are somewhat obsessed with creating businesses that alleviate life’s big and little annoyances. There’s a focus on finding solutions for everything from dropping off to picking up laundry to buying razors, nappies, clothes or dog food.

The sharing economy is also heavily pursued. Airbnb and Uber are the most celebrated examples of this movement, but there are countless other start-ups that share everything from your kitchen and what you cook in it to your power tools, your car or even your pets.

It seems that perhaps this desire to share is driven more by the ecosystem and context of both the Alley and Valley than by noble altruism. First of all, (V)alley housing is very expensive. According to recent data, a one-bedroom studio apartment in either place will easily set you back $3,000 or more, and rent increases 16% year on year.



The new term for people working in the start-up ecosystem is “Henrys,” which stands for High Earners Not Rich Yet. That they’re not rich yet is because of the high cost of living and the fact that all those Ubers, Whole Food shopping trips and Venti Americanos do add up. As a result, many people end up sharing a living space with roommates, thus extending their college living conditions by at least another five to seven years.

There are more clues that college life gets extended into work life, since many people find themselves employed by companies that refer to their work places as campuses. And if you are not working on a company campus, you are very likely working in a shared work space. In all these work locations there is a large emphasis on sharing resources, which is not unlike how you shared what was available in your college dorm.

Finally, in order to save money or to get access to things you can’t afford during your student years, you “hack.” By that I mean you find creative, alternative and sometimes (borderline) illegal solutions in order to save money or avoid hassles, like downloading music or movies through peer-to-peer services and then sharing them among your friends, or sharing a Hulu or Netflix subscription.

It’s no wonder, then, that many start-up staffers invent business models that are a direct evolution from their own life situation, focused on sharing and life hacking. The question is if these solutions are indeed big enough ideas to become scalable and profitable businesses.

Another refrain I heard last week on either side of these United States was that there’s still plenty of money sloshing around. The kinds of investments people are making is profoundly changing, though. Where VCs were calling the shots earlier and almost exclusively, today it is a large ecosystem of angel and other individual investors, corporate money — and for sure, still VCs. But the amounts being sought and offered are now in the hundreds of thousands of dollars — seldom in the millions.

My main conclusion, though is that the Valley and Alley are both very much alive, and as dynamic and fun as ever.

2 comments about "Silicon Valley, Silicon Alley And Henry".
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  1. Kenneth Hittel from Ken Hittel, June 22, 2015 at 4:07 p.m.

    A good read, for sure, a nice analysis -- but nothing in the way of a conclusion. Would have been interesting to consider what happens to all the Henrys who, by defintion, never be be "rich yet."

  2. Paula Lynn from Who Else Unlimited, June 22, 2015 at 6:13 p.m.

    If they really want to "change the world", then find the solutions to the housing problem that is bubbling over, sooner than they want to believe, into the streets. We need another app or another delivery (going to pay those delivery people enough to afford to live in a place with a roof?) like we need another boil on the bottom of your feet.

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