DALLAS — Dallas has lots of entrepreneurs, tons of money, and a favorable business climate. So why isn’t it more like Silicon Valley, and what can the community do to have something more like the Bay Area startup scene?
That question was posed to a panel on Monday morning at Dallas Startup Week, a five-day event that runs through Friday in downtown Dallas that’s designed to build awareness and support for the startup community.
The panel included representatives from different parts of the Dallas startup ecosystem. Gabriella Draney, CEO of the well-known B2B accelerator Tech Wildcatters, was the moderator. Panelists included Michael Johnstone, director of web technology at Mark Cuban Companies; Matt Himelfarb, managing partner at Dallas Venture Partners; and Bettina Bennett, CEO at Whichbox Media.
Johnstone first noted that “it isn’t that much easier to raise money in Silicon Valley.”
“It is true that more deals happen in Silicon Valley, and more deals happen overall with more money per deal,” he said. “But the more interesting number is when you compare the amount of wealth in Texas to the amount of wealth in the Valley — there’s a disproportionate number of deals happening in Silicon Valley for that wealth.”
We highlighted the incredible amount of wealth in the Dallas area in our Startup Week preview piece last month. But the problem, as Bennett noted today, is that a vast amount of the money is with those that made smart investments in oil, gas, and real estate industries — people that may not be gung-ho about investing in a tech startup led by a couple college graduates.
“The question for me, is how do we educate the capital we have in this region around the opportunities that actually exist within technology and startups?” Bennett offered. “There is a discrepancy between what people invest in traditionally, and understanding that there may be an opportunity to venture outside of that and invest in other ways.”
Bennett, whose seven-year-old company helps brands tell interactive stories, said that there clearly isn’t a shortage of money or creative people in Dallas.
“We just have to figure out a way to make our own extra special Dallas barbecue sauce, and I think some of it has to do with how we educate people around us instead of just being in this bubble where we pat each other on the back,” she noted.
Himelfarb, the venture capitalist, said Dallas needs to focus more on “absolute return” versus “relative return,” and being louder when it comes to celebrating homegrown successes. He noted how Dallas has more corporations based in the city than anywhere else in the U.S. except New York and Houston.
“There are businesses in Dallas with huge success stories.” he said.
But Bennett added that Dallas should be better at not just celebrating success, but celebrating failures, too.
“When I talk to serial entrepreneurs in Silicon Valley, they say failure there is really regarded as a milestone to something greater, bigger, and better,” Bennett said. “The mentality here is more like, ‘oh my gosh, did you see how that company didn’t work out?'”
Comparing your own growing startup community to Silicon Valley certainly isn’t a new trend. While GeekWire was in Arizona for Phoenix Startup Week just a few days ago, there was an entire session about lessons to learn from the Bay Area startup ecosystem.
But the panel today made it clear that they don’t want Dallas to become the next Silicon Valley. “We should just aspire to make Dallas great,” Himelfarb noted.
For Draney, who runs a nationally-recognized B2B accelerator in Dallas, it’s all about working together with every stakeholder in the startup ecosystem — and not just in Big D, but rather across the state.
“The more we collaborate on things and think about how we make the whole greater than the sum of its parts, the better off we all are,” she said. “Honestly, the whole Austin, Houston [comparisons] — get over it. Texas as a whole is one of the biggest tech economies in the world. Why don’t we just own the fact that we are Texas? Collaboration is key.”
