I tweeted this message after I came back from Shenzhen on Friday night.
The activity in Shenzhen was amazing. An early stage startup could literally finish brainstorming, head over to a mall and hack a prototype, find early adopters, and submit an order to a manufacturer in a day.
Early stage startups are better served by being close to their supply chain, whereas later stage startups could 1. afford to be farther away 2. gained strategic advantages of being away by orienting themselves more to the international market.
I call this 'reducing your execution pathway'. Within the OODA loop, a startup that reduces their path time from the 'Decide' phase to the 'Act' phases allows them to make their execution more efficient.
A similar corollary is to have developers on your team. You can certainly outsource to developers at an early stage - but you increase the execution pathway if you do. And that reduces the advantage that an early stage company has.