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Better Universities in California

Many VCs admit that while the University of Washington produces some talented people to feed startups, it doesn't compare to the California universities. "By far Seattle's biggest challenge is that UW is not Stanford," Kelman said. "It's not just that [Stanford] gets the brilliant people, but it empowers them with an elaborate sense of entitlement. With a UW engineering student, you spend most of your time trying to talk them out of a job at Google or Microsoft. With Stanford graduates, you try to talk them out of taking jobs with three other startups you've never heard of to work for yours, or from starting their own company."

As for Seattle's reputation as home to people who put snowboarding and hiking before their jobs, that's not exactly true, Darling said. "People in Seattle are meat eaters too. The positioning of people in Silicon Valley as hardcore, kill everyone, just do it, and people in the Northwest as vegans riding bikes and working four hours a day and doing a bit of yoga, I think that's a bit disingenuous."

The whole focus on the difference in lifestyle between Seattle and Silicon Valley is similar to one that took place when Silicon Valley was first emerging as a hotbed for technology. "The people on the East Coast thought we were all a bunch of hippie crazies doing weird stuff in those days," Darling said. "My conclusion is that Seattle will put a unique stamp on things lifestyle-wise... but it will break through and it will be based on results."

The Seattle executives all sounded a bit amused about the online dustup, although Kelman, who received some abuse, came out perhaps a bit bruised. "To be clear, I really felt slightly misunderstood by the bloggers," Kelman said. "My point wasn't to say that Seattle is better than Silicon Valley, I don't think you can make that argument. Silicon Valley is the center of the tech universe. But over time I've come to appreciate that even though Seattle will never be Silicon Valley, it has its own charms."