Betting on Boston: Why Startup Genome has it Wrong

Russ Mezikofsky

I got a lot of feedback about Michael Farrell’s piece last week, which noted that, in one study, New York was outstripping Boston as a start-up hub. I expressed my own skepticism, as did a number of commenters. But what matters most is how entrepreneurs respond, and Bob Rizika, chief executive of Infrastruture-as-a-Service company ProfitBricks, offered to share why has built company after company in the area, and why he’s betting big on Boston’s continued prominence.

The Boston-area tech community regularly bristles at any story suggesting its dominance is slipping away. The latest came in just before Thanksgiving and was enough to make any Bostonian’s Thursday feast less palatable.

Startup Genome pushed Boston down on the list, behind New York. It was bad enough that Los Angeles emerged in the number two slot, and that globally Boston fell behind Tel Aviv, but coming in behind New York was a bit like having the Yankees take the field at Fenway wearing their home uniforms.

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But here’s a funny thing: We at ProfitBricks chose Boston, Boston didn’t choose us. Well, specifically we chose Cambridge and there is a long list of reasons why.

ProfitBricks is a German company that found a second home in the US in order to take on cloud services companies like Amazon. We could have located anywhere and carefully considered what location would be the most beneficial to our growth. We looked at Silicon Valley with its amazing startup community, considered Seattle thanks to its Microsoft and Amazon talent pool, we glanced at the vibrant New York tech scene and even considered up-and-coming places like Chicago.

After some deliberation it was apparent that Cambridge was the obvious choice. It’s not just because I’m an MIT grad and built and sold four other companies here, nor because of the vibrant VC community, including companies like Flybridge General Capital, Globespan Capital Partners and General Catalyst, that continue to help build great companies, but because Cambridge offered us access to talent that could dive deep into computer networking. The people here developed the TCP IP protocol, they created EMC storage networks, they write algorithms that power the Web, they create the essential technologies we need to help develop the Internet’s core infrastructure that is unmatched on the market today.

As Walter Frick points out, Boston entrepreneurs are better educated and motivated by different things. They’re far more interested in creating a great product than in pushing a “quick flip.”

There is great talent all over the world creating billion dollar markets. They’re building all sorts of businesses using software as the building blocks. The truth is, we are living in a historic time for technology and are finding businesses of all kinds are on some level, converting to a software model. Whether it’s how credit card companies use the latest technology to keep our information safe or network gear transforming into software defined networking or cloud-based simulations transforming the manufacturing process, it’s all changing and will impact every one of us.

But what Boston has that no other city can boast is the deep-rooted community of engineers and specialists transforming technology at its core level. Boston is home to an effervescent assembly of software developers doing the front-end work that we experience every day. It’s also home to a special group of networking innovators making an indelible mark on the technological evolution.

The people here aren’t just skilled at making apps look slick, they understand how to rebuild the cloud behind it that makes it all run smoothly. Like the genius behind the curtain, Boston is the hometown for computing innovation – creating real change for the technologies we use every day.

As an example just look at Spindle, which aims to transform how people find social content. As Pat Kinsel points out in his own blog post, they didn’t just try to make a beautiful looking app. In fact, they didn’t entirely know what form it would take, but they started with fundamental questions and created underlying technology to reach the goal.

This is the kind of innovation we came to Boston to find.

Put in different terms, it’s the difference between the people who can design a beautiful toaster and the people who make power plants more efficient. Both work with electricity, both are important, but the skills required are entirely different.

So we’ll take our crammed office just outside of Central Square and we’ll listen to the construction crews as they build more offices all around us. We’ll enjoy the walks over to MIT and the evenings at tech meetups like Mondays in the Cloud and the Boston New Tech Meetup, where we get to talk with incredibly smart, educated and driven people.

Then we’ll watch the Sox take the field in their home uniforms. We’re grateful to be part of this amazing community and everything it has to offer the world – whether they know it or not.