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These are my notes from yesterday’s Start Up Conversations 2.0 event, which I chaired, and where we had Peter Tegelaar (Co-founder NewCope / YCombinator), Iolo Jones (TV Everywhere) and Jeannine Athas (Waterbridge Capital) and a roomful of active and would be entrepreneurs, advisors and service providers to start-ups.

You spend your days designing software, alongside some 30 others, who are each doing their own thing. You live in make shift accommodation. Once a week you get called for dinners with lots of networking and sharing of ideas, and get to listen to people of the calibre of Mark Zuckerberg and other greats from the Silicon Valley. You have a big presentation of your work in 3 months. No, this is not a semester at Stanford, it is, in fact life at Y Combinator. And if it smells like college, perhaps that’s exactly how Y Combinator has structured the experience.

Not only that, we were told how meeting and convincing the right lawyer is critical to entry into the inner circles at Silicon Valley. Be it financial models, approaching VCs or exiting companies, the Silicon Valley seems to work like a smooth machine that keeps ticking over with new start-ups at one end and a reasonable number of exits, floatation, or trade sales at the other. It’s a well defined system and a well trodden path.

So how easy or hard is it to recreate this environment in London, in the form of Silicon Valley? Well, there are a number of challenges to be overcome:

First, the common view was that London suffers from an abundance of what Paul Sturrock from Slingshot calls “season ticket holders” – VCs and investors who like season ticket holders have been to a lot of games (investment opportunities) and believe they know what the team should do, but haven’t actually played the game. Too many VCs in London are career bankers with no experience in start ups, compared with the Silicon Valley, where the average VC is a successful entrepreneur.

Second, the ecosystem is simply not geared to deliver the kind of efficient start up growth that the Valley enjoys. Banks, the Government, and even the Media seem to conspire to hold start ups back. This is linked with business culture in general in the UK which everybody will tell you is more conservative. Start ups aren’t rock stars in the UK, they are in fact objects of suspicion.

Thanks to a combination of these elements, across Europe, there is a preference for “me too” models – copying or adapting what has worked in Silicon Valley.

And of course, that’s discounting historical factors – including some 70 years of technology investment history in the Valley and significant military research driven investment. This last point also explains Israel’s punching above its weight on the global start-up market as the model of transferring technology and skills between the military and private sectors seems to have been very effectively worked out, there.

When you think about it, though London has some excellent advantages – just like the US, London has a very strong immigrant workforce and this brings a level of entrepreneurial energy of its own. There is a wide base of human skills and some aspects of start-up infrastructure – notably, the ability to start a limited company very in 30 minutes rather than in 3 months – are very progressive in London.

At the end of the day Start-ups don’t just need money and sops, they need clients, markets and suppliers. The depth and breadth of the technology industry across the Silicon Valley also provides most tech start ups ready client bases (sometimes at walking distance, as was pointed out yesterday). For a tech start up therefore, there is no comparison to the Silicon Valley. California also has strong entertainment, aerospace, agriculture and defence industries, so a lot of opportunities exist for businesses starting out to sell into these sectors. By comparison, London is strong in financial services, media, entertainment, fashion and design sectors. Start-ups in these segments would probably do well to set up here.

And of course, any strategy text book will tell you, you don’t play to your opposition’s strength. If Silicon Valley is the competition, London could do better than trying to beat the Valley at its own game. It will take decades for London to build up infrastructure and ecosystems to compete with the Valley for technology start ups, depth and breadth of opportunities. On the other hand, in some of the other areas, perhaps there are opportunities for London to become the centre of an entirely different type of start-up. It is already a common destination for European start ups.

So message to London’s start-ups: stop moaning. If you’re building a tech start-up, pack your bags for the Valley. If you’re in a start-up that can utilize London’s strengths, get building!

The next Start-Up Conversation Event will focus on “How far can you bootstrap?” – and will be on the 1^st Tuesday of March. Looking forward!

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