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IPOs from Uber, Airbnb and Slack could raise money for San Francisco



Freestyle has been looking for deals elsewhere partly because of how expensive San Francisco has been from an investment perspective. Felser said he found "pockets of technological dominance" around the world, whether it was Finland for mobile gaming or Estonia for crypto baskets.

"The values ​​are as high as they have ever been," he said. "It's a bit of a unique Bay Area thing. You invest in the same company with the same type of calculations, and they're going to be 30 percent cheaper off the Bay Area."

Felser is not alone. According to a survey by venture capitalists from Silicon Valley released on Thursday, trust among startup investors is at its lowest for nearly a decade, with some investors claiming the sky's high cost of living and business in the San Francisco region. Smaller beginners struggle to compete.

"It's just a challenge and demand, because those companies that go public are growing so fast that they create all available employees in the market," Felser said. . Those who go public will get this "inflow of cash, and then they can actually hire more and faster, and maybe there is more pressure to grow faster."

Investors find more hidden gems outside the Bay Area, because the risk-assessing ethos is often associated with San Francisco spreading, says Eric Byunn, partner of Centana Growth Partners, an investment firm with offices in Silicon Valley and New York.

But Byunn does not expect to see a ton of capital. Silicon Valley goes through boom-and-bust cycles, but always reinvests itself. There is no reason why it will not continue.

"There is certainly a certain density and concentration of interest and talent and resources to build a company here," said Byunn. "You enter a trendy restaurant and three-quarters of the conversations in the restaurant are about technology and startup."

-CNBCs Ari Levy contributed to this report.

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