Bay Area VCs agree that Silicon Valley may be losing its gravitational pull after all

Earlier today, we took the stage at TechCrunch’s Disrupt event with top VCs Megan Quinn of Spark Capital, Sarah Tavel of Benchmark Capital, and Aileen Lee of Cowboy Ventures to explore some of the trends rippling through the startup investing ecosystem. Think megafunds, SoftBank’s $93 billion Vision Fund — even whether Silicon Valley is losing some of its gravitational pull, as suggested in a recent Economist piece that’s been making the rounds.

On the last front, and a little to our surprise, the VCs seemed to agree that a shift is afoot, if we aren’t already past a tipping point. Lee said she hadn’t read the story, but that for her part, “Probably,¬†for all of us, around boardrooms, [we’re] talking about that hiring challenges in the Bay Area. And when companies get to a certain size, it often comes up that they’re thinking about moving or opening up a second office because it’s too expensive to live here . . . we’re definitely starting to see that more.”

Quinn agreed, saying that when Spark makes a growth-stage investment in the Bay Area these days, “We often [tell the founders to] go to, draw a three-hour circle around San Francisco where [the city has] direct flights, [then] find a city that has a university and open up a second office as quickly as possible.”

Even Tavel, whose firm has long been known for its laser-like focus on (and success in) Silicon Valley, admitted that she used to “believe very strongly” that to build a multi-billion company, founders had to set up shop in the Bay Area. Yet in the last couple of years, she continued, “I’ve stopped giving that [advice to founders] because it is just amazing how competitive it is for talent here and how expensive it’s become, especially when you’re competing against, you know, the big incumbents like Facebook and everybody else that have these gushing cash wells, and they’re in their businesses.”

You can check out more of the conversation below.