The New Geography of Startups

Summary

• Angela Strange traces a16z’s initial international strategy to a line from Nubank’s David Vélez (relayed via her brother): “you could compete to be the fifth financial services provider for every customer in the US,” or go to markets with “5 fat, happy banks that only serve 20% of the population.” That thesis produced her first-ever a16z check—Santiago Suarez’s Addi, now serving a quarter of Colombia’s population for banking and payments—and later intersected with Gabriel Vasquez’s mapping of LatAm’s then-30 unicorns into a WhatsApp community.
• Gabriel frames AI’s dichotomy: the technology “is very democratic… it distributes the ability to get it anywhere in the world,” but also concentrates the epicenter of rapid movement in the Bay Area. The flow reversed—instead of a16z flying to Brazil and Colombia, founders everywhere wanted to come to the Bay Area—and country-specific diasporas became the on-ramp. Elena Burger argues these networks may be even more powerful than elite-school alumni networks; Strange says they often lacked organization.
• The discussion identifies three native advantages borderless founders can use to accelerate preferential attachment: differentiated talent pools, government-backed brand, and enterprise-customer access. Vasquez’s “AI Olympics” frame: every country wants medal-winners, so Poland’s government invested in ElevenLabs and Sweden’s supported Lovable and Legora, giving them a jump-start in validation with local and adjacent enterprises. Strange adds that “nobody wants to be the first bank or the first insurance company” in the US, but a borderless network can land that first logo abroad faster.
• The bridge runs both directions: Cognition’s early go-to-market was Brazil, which represented “a really high share” of its early revenue, because Brazilian enterprises wanted to adopt AI quickly and had fewer providers. The newer, less intuitive power is intra-diaspora cross-pollination—a German company’s first design partner was the largest Spanish conglomerate—which Vasquez presents as a capability that “probably no other investor” can provide from the get-go.
• Repeat founders are a deliberate sourcing wedge: a first wave of local entrepreneurs reached meaningful scale, often in the $1–5B range, without seeing their visions through, and “this $5 billion outcome wasn’t enough for me” drives round two. Frederik G. M.’s Pip.com chose a16z despite pre-existing investor relationships after the firm helped ideate with top executives from DoorDash, Lyft, and portfolio companies—differentiation on ideation, not check size.
• Practical advice for international founders: visas first—a16z is invested in O-1 visa company Extraordinary—then spend at least 3–6 months in Silicon Valley, not just weeks. Strange says, “I never met somebody that came to Silicon Valley and was like, ‘This was such a waste of time.’” The real product is speed calibration: “Silicon Valley continues to be ahead of every other ecosystem” in the speed at which people operate.
• The long-term claim: 40% of a16z’s investments were in international founders, split evenly between those based in the US and those based elsewhere. Vasquez wants the share of venture returns attributed to companies outside Silicon Valley to rise from 10% to 20–30%. He says the statistic does not fully tell the story: many borderless companies are based in Silicon Valley while much of their engineering team may remain in the founders’ home country, so they can be claimed by two countries.

Deep dive

1. From a Nubank aphorism and a WhatsApp group to a broader strategy

• Strange’s origin story: while writing about how difficult fintech distribution is in the US, her brother joined Nubank and relayed David Vélez’s framing—compete to be “the fifth financial services provider for every customer in the US,” or enter “a wide-open market with 5 fat, happy banks that only serve 20% of the population.” That pulled her to Latin America and her first a16z check: Santiago Suarez’s Addi, now serving a quarter of Colombia’s population for banking and payments.
• Vasquez’s entry was a WhatsApp message from another team: “you haven’t met me yet, but I see this huge opportunity in Latin America. I’ve gone and met 25 of the most important CEOs.” At the time LatAm had only 30 unicorns, and Brazilian, Colombian, and Mexican founders weren’t talking to each other—so a16z put them all in one group with Marc Andreessen, Alex Rampell, and others, where they began exchanging deal flow as prolific angels.
• The archetype that emerged: founders who grew up at home, spent time in the US, and returned—Suarez went to Yale and worked at US financial firms before going back—plus a structural forcing function: “there’s no fraud-as-a-service or KYC-as-a-service. So you end up having to build everything,” which demands deep local knowledge.

2. AI reversed the direction of travel

• The strategy’s inflection wasn’t geographic, it was AI. Vasquez’s dichotomy: the technology “is very democratic… it distributes the ability to get it anywhere in the world,” but also concentrates the epicenter of rapid movement in the Bay Area. Founders stopped asking a16z to fly down; “they all wanted to come to the Bay Area.”
• What they bring is less about local knowledge—“now you’re going to play on the global stage”—and more about connectivity: each nationality maps its own top talent in Silicon Valley because “people can see themselves through that journey.”
• Hence the “Borderless Dinners,” initially LatAm-only, with Guillermo Rauch of Vercel, Pedro Franceschi of Brex, and other successful founders helping newcomers. The group has matured: early attendees such as Slash’s Victor Cardenas graduated into unicorn founders and now speak themselves. Burger argues that country-specific diasporas may be even more powerful than elite-school alumni networks; Strange says they often lacked organization.

3. Who counts, and the chip on the shoulder

• Strange takes “the most inclusive view ever”: anyone building a global company—“whether you’re building primarily in your home country to start, but have global ambitions”—is a borderless founder.
• Vasquez’s psychological read, from his own El Salvador upbringing: “nobody says, ‘Hey, I met this other great guy who came from El Salvador.’ You’re creating the benchmark on your own.” The same drive shows up in a portfolio founder from a tiny German town: a desire “to become the benchmark and prove something to the world: regardless of where they were born, they can still achieve greatness.”

4. Three native advantages—and more levers for preferential attachment

• The discussion identifies three advantages: talent and access to talent, brand, and customer access. Brand is captured by the “AI Olympics” frame: every country wants medal-winners, so Poland’s government invested in ElevenLabs, whose founders are Polish, and Sweden’s supported Lovable and Legora. That support acts as “a stamp of validation,” jump-starting enterprise relationships in the country and adjacent markets. Brand also solves recruiting: Addi could attract a credit officer from Capital One in Virginia to Bogotá by becoming “the hottest company in Colombia,” rather than one of many similar US companies.
• Customers: Factor Labs started with Latin America’s largest conglomerate, owned by the Slim family; Spain’s Supersonic connected through a university network to a former Salesforce CRO, making Salesforce its first design partner and eventually a customer. Jeeves works with Brazil’s central bank on helping corporations move money internationally via stablecoins, building trust that compounds into talent.
• Talent: in “the fiercest talent market I’ve seen in my career,” a Brazilian AI-insurance company can find AI talent outside the most famous universities through scholarship programs that scour the country and robotics competitions. Once a company gets 10 exceptionally smart people early, the 11th recruit with 100 US offers may ask, “How did they get people that are that good there?”
• Burger introduces the preferential-attachment framing, and Strange says a16z was built in part to accelerate that flywheel. Borderless founders “have more levers at their disposal.” The bridge runs both ways: Cognition’s early revenue had a very high share from Brazil, and the intra-diaspora angle—a German company’s first design partner being the largest Spanish conglomerate—is, per Vasquez, something “probably no other investor” can provide from the get-go.

5. The playbook: luminaries, rising stars, repeat founders

• Entering a new geography starts with “local luminaries”—respected ecosystem-builders regardless of exit size. Voi’s Fredrik Hjelm and Adam Jafer built a scooter company, yet Hjelm angel-invested in “pretty much all the relevant companies” coming out of Sweden. Step two is mapping the diaspora’s rising stars—like Gabriel Petersson, a Swedish high-school dropout who went from Midjourney to becoming one of the youngest researchers at OpenAI and then started a company, whom arriving Swedish founders want to meet. Vasquez’s joke: “in every country, I make them feel like it’s the only country that I look at.”
• Repeat founders are a sharp sourcing wedge: a first generation reached meaningful scale, often in the $1–5B range, without seeing its vision through, and “this $5 billion outcome wasn’t enough for me” fuels the second act. Frederik G. M.’s Pip.com picked a16z over pre-existing relationships after ideation sessions with top executives from DoorDash, Lyft, and portfolio companies. Strange adds the two-sided trade: hungry repeat founders can provide “great CEO school” for brilliant 18-, 19-, and 20-year-old AI engineers who want one job before founding.

6. Practical on-ramp and the ten-year map

• The first problem is visas—the “most stressful process”—handled partly through portfolio company Extraordinary, an O-1 visa company. Then come hacker houses: a16z sponsored Palo House, founded by four CDTM students from Germany whom Vasquez met at Slush in Finland. Over four months, about 1,200 people ended up staying there through dinners and the house community—“really running a small liberal arts college.” A less obvious channel is the next generation in powerful business families, who want to become AI-native; those introductions have produced “actual contracts for portfolio companies.”
• Vasquez says the answer varies, but founders should definitely spend time in Silicon Valley. Strange recommends at least 3–6 months, because “a couple of weeks” may not be enough to reach the network’s depth. The payoff is calibration: “Silicon Valley continues to be ahead of every other ecosystem” in the speed at which people operate. She also advises founders to lean on their diaspora, which is “way deeper than probably you think.”
• The ten-year hope, in numbers: 40% of a16z’s investments were in international founders, half based in the US and half in other countries. Vasquez wants the share of venture returns attributed to companies outside Silicon Valley to rise from 10% to 20–30%, and says the statistic does not fully tell the story: many companies are based in Silicon Valley while much of their engineering team may remain in the founders’ home country, so they can be claimed by two countries. Strange’s close: “we are just 1% scratching the surface of what we can do with AI.”