They traveled halfway around the world to Silicon Valley – and they say you should too

If you build it, they will come.

Silicon Valley is the Mecca of startups and has a history of producing some of the greatest technology seen this past century.

Thousands of engineers and entrepreneurs make the journey every year from around the world. ”The first word I learned about startups was ‘San Francisco,’” says Takashi Fuke, who hails from Japan.

To some, there is nowhere else.

Show me the money

The amount of money available to startup founders in Silicon Valley is not even close to anywhere else on the planet. Over 50 percent of the US$128.5 billion of venture capital investments last year were made in the United States. In fact, the US$72.4 billion invested in the nation in 2015 is almost as much as the 2014 worldwide total of US$89.4 billion.

Outside of the United States, VC backing is harder to come by – particularly in Japan. James Riney, who runs the Japan branch of US-based 500 Startups, discussed the titanic difference in a post on TechCrunch:

You can raise a couple hundred thousand in a week or two.

“In 2014, about US$960 million was invested in venture capital [in Japan], versus $48 billion in the US – a difference of 50x. For angel investment, the difference is about US$1 billion to $24.1 billion. In other words, there was only about US$1.96 billion available to Japanese entrepreneurs. That’s almost the size of Andreessen Horowitz’s fifth fund.”

A lack of angel investors is a critical problem for very young startups. Industry veteran and current Fitbit senior advisor Yoshitaro Kumagai agrees. In Silicon Valley he says, “you can raise a couple hundred thousand in a week or two.” Often these angels are experienced businesspeople who give advice. “This can be more valuable than the investment,” adds Yoshitaro.

Power to the people

“The most important thing for Silicon Valley is the liquidity of entrepreneurs,” says Jon Metzler, president of consulting firm Blue Field Strategies, which has offices in San Francisco and counts major Japanese corporations among its clients. “Regulations and capital are second,” he emphasizes.

Much of the talent is international. Over a quarter of technology and engineering companies (PDF link) founded in the US between 2006 and 2010 were started by foreign-born entrepreneurs. For the third year in a row the controversial H-1B for specialized foreign workers reached its 85,000 cap in a matter of days. A large chunk of these visas go to tech companies.

In contrast, the number of people entering Japan on specialized engineering visas is still below 2006 levels, with only 5,216 immigrating in 2012. Based on a percentage of the population, the United States brings in over 6.5 times more highly skilled labor than Japan.

When in Rome

The real San Francisco Zoo