It’s not appealing to live in the Silicon Valley, where everyone is tired and clumsy. Not edgy tech people, that’s for sure. Business Insider asked recruiters why for an article with the concise title, “Silicon Valley is not the tech capital of Silicon Valley as employees flee Google, Amazon and other companies in search of crypto and Web3 startups..” Why is that? This article has the following response:
“That’s largely because people want to work on what is most exciting in technology, recruiters said. Right now, that’s crypto and Web3. With a scarcity of engineers focused on the space, it’ll likely also pay off to take the risk and get in early.”
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The crypto market is seen as exciting, and there’s a positive risk-reward ratio. And there’s more!
What do Recruiters Think About Silicon Valley and Crypto?
Scott Fletcher, Intersection Growth Partners’ CEO and author of the article gives an overview.
“We are unquestionably seeing some of the best and brightest of Silicon Valley, or tech, move over to crypto. I’ve been at this a long time, I’ve never seen a change happen this quickly.”
He gives us an explanation later:
“To start at someplace that’s fresh, that is — by its ethos — trying to empower the individual as opposed to the centralized corporation is appealing.”
This is for ideological reasons. But there are other reasons. Vivek Ravisankar (CEO of HackerRank) takes the decreasing route.
“Developers like new things — they like new, shiny objects.”
So, novelty. But wait! Alex Zakupowsky of Artisanal Talent follows the historical path:
“Coinbase, in my view, was really the first one to get some very big hires from places like Google and LinkedIn and Lyft. And now you’re seeing some very former senior people at the Ubers and Amazons and Pinterests and Atlassians and SpaceXs that have jumped into this, and they’re going to be recruiting from their networks.”
Now, we have momentum and network effects. It’s there. You got it. Kelsey Begin of Intersection Growth Partners was also historic:
“At the beginning of the Web2 cycle, you saw a lot of the same types of people who are attracted to crypto now gravitate to these big tech companies because it was something new and innovative and really exciting.”
So, gravitation.
Price chart for COINbase on Nasdaq | Source: TradingView.com
What is the reason why talent leaves Silicon Valley for crypto companies?
- Motives that are ideological. To work somewhere that “by its ethos” is “trying to empower the individual.”
- Innovation, excitement in a new business where laws are being made
- There is a lot of momentum in the sector.
- These big hires can be attributed to network effects, which is the ability of trusted people to recruit.
- Gravitation. It is so addictive that people are drawn to it.
- There is a positive shift in the risk-reward ratio.
Conclusions and Illusions
People go where the money is, let’s not kid ourselves. Risk/reward is the main reason. A potential payout can make talent feel a lot of joy. There is the chance to choose the best project and make it big. It is very appealing to choose a high-risk, high-reward project.
The most compelling reason, though, it’s the ideological reasons. The potential of the talent is immense, even though they may be there for the money. It is an innovation that could help millions of people previously excluded from the bank system. A technology that rewards the individual with a much higher reward. It is truly amazing.
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In any case, one thing’s for sure: the tech talent is already migrating from one industry to the other. This phenomenon isn’t likely to stop, not even likely to slow down. This begs the question: Will crypto-companies deliver? Some of them surely will, but, it’s definitely a gamble. If you choose the wrong project, you could end up in the unemployment queue. You might just find the best one.
Greg Bulla's Featured Picture on Unsplash | Charts by TradingView