French start-up Scality has moved several of its executive team to Silicon Valley in a bid to capitalise on the area’s “buzz” and “ideas”, while keeping its army of loyal developers in Paris.
The software company, which employs roughly 85 people and specialises in object storage-based technology for large scale organisations with huge data needs, said one of the primary reasons for keeping the 60-strong development team in Paris was to keep costs down.
Scality CEO Jérôme Lecat told Techworld that he would have to pay Silicon Valley developers up to $200,000 (€145,000) per year, compared to the €40,000 – €60,000 he pays developers in Paris each year.
“But it’s not only that,” said Lecat at his San Francisco office last week. “Here they [the developers] demand more stock options and they are less loyal so they tend to leave you if they find another start-up that promises more stock options. Our engineers in Paris are staying year-after-year and they’re happy for us."
In addition to large salaries and attractive stock options, technology companies in Silicon Valley often try and entice developers to come and work for them with perks such as free transport, free gym membership, free food and stylish offices.
Lecat said another reason for keeping Saclity's Silicon Valley presence as minimal as possible is because it's difficult to compete with the large technology companies based in the San Francisco Bay area.
"We don’t think we’re missing out on the best developers in the world," he said, claiming that some of the top developers in Scality's field happen to be in Paris where Google, VMWare, Facebook and Microsoft are less active recruiters.
Lecat said Scality's management and marketing teams are in Silicon Valley because ultimately that's where the ecosystem is. “It’s where we get the buzz and the ideas,” he said. “I think it’s critical to be here because otherwise you’re late on everything."
The CEO also acknowledged that there is far more funding available from venture capital firms in Silicon Valley. However, he suggested that he could raise money for his business just as easily in Europe.
"It’s not a question of money," he said. It’s a question of what comes with the money. The Silicon Valley VCs have much more experience in what it takes to build a start-ups and they have much more experience of what we’re going through.
"Their advice is more useful, their connections also. We have a lot of connections to banks and the executive management of the big IT companies that can be partners so that’s very useful."