Photo: Owen Thomas, Business Insider
In July 2009, things were going pretty well for Yammer, then a small enterprise-software startup based in Los Angeles. But something was missing.Yammer CEO David Sacks, who had moved to Los Angeles in part to pursue a successful career as a movie producer, had a long talk with one of his investors and advisors, Keith Rabois. Both had worked together at PayPal.
“It was supposed to be a 10-minute catchup,” Sacks told Business Insider. “It ended up being an hour-and-a-half conversation.”
“I woke up the next morning thinking, ‘What am I still doing in LA?'”
Sacks went into the Yammer office and told the team they were moving to Silicon Valley. A month later, the company and 13 of its 15 team members had moved. (Yammer parted ways with the other two.)
Sacks cited the “brain trust” of startups in San Francisco’s SoMa district, where Yammer put down roots.
“We just started thinking bigger,” Sacks recalled. “Right away we stepped up our fundraising, stepped up our hiring. We just realised there’s no such thing as a highly successful small startup.”
With Yammer having sold to Microsoft for $1.2 billion, and Sacks still in charge, it seems like the right bet. The Los Angeles tech scene is just starting to heat up, and there’s no telling where Yammer might have been had it stayed put while waiting for a thriving startup community to form.
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