Startup City Magazine

Stik to Exit Silicon Valley for Hometown Detroit

Stik, which was earlier a company located in the Silicon Valley has recently moved to Detroit for a change.  The company mainly uses social graphs to create a list of online service professionals. It was launched two years back in the San Francisco Bay area but moved to Detroit in order to receive a greater access to potential talent.

“We have time to get to know potential hires here,” Nathan stated. “We can take a couple of meetings, work through a code problem together. By the time you do that in Silicon Valley, the person has already taken a job.”, says Nathan Labenz, one of the cofounders of Stik, as reported by Techcrunch.

“They’ve already been hired and fired three times.  We think Detroit is a better place to build a business than the Valley,” Jay Gierak, another cofounder states. “Go find a place where you can differentiate your product and support network.”

According to Nathan, “We just feel like we are able to proceed much more thoughtfully, carefully, making sure we have the right nucleus of people,”

“We had a great network the last two years in the Valley. But the employee side was more advantages here in Detroit being a much bigger fish in a smaller pond of startups. We didn’t start here 2 years ago because we didn’t see the network of investors and advisers that we knew existed in Silicon Valley. But that was 2010. Now, in 2012, there are a lot of resources here between Quicken Loan’s major investment in the tech scene and an investor group in Ann Arbor that has been very helpful.” the cofounders agree.

The growing tech scene in Detroit, along with the existence of Detroit Venture Partners, a dominant Venture Capitalist firm in the area makes it a comfortable spot for the cofounders to start their business, though they plan otherwise when it comes to starting their own company. Both founders agree to the importance of good backers, team members and advisors.

The sense of commitment, loyalty, grit and determination found in Detroit led the four employee company to move their business to the city. Moreover the founders also discovered that though the volume and diversity of people in the bay Area was much greater, the quality of conversation in Detroit was much similar to that in the Bay Area. In fact, both Jay and Nathan are former students of the Detroit University Jesuit High School.

“We initially started the business in San Francisco for the same reasons everyone starts a business in and around Silicon Valley – it was the thing to do,” Jay says. “Ready access to experienced mentors and investors taught us quite a bit in our early days, as we had limited experience developing consumer web products from the outset. When we looked around Silicon Valley, we felt we couldn’t build a long-term company there because of the turnover – not only to get people in the door but retain them.”

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