The three founders of energy startup Furo are 28 years old. They started out in Silicon Valley, moved back to Germany, and raised $4 million — most of it from US investors.
If that sequence sounds backwards, it's because of a common assumption about where startups should base themselves: that to raise money from American investors, you have to be in America. That without a Silicon Valley address, a team won't be taken seriously. So founders — Korean, European, wherever — end up booking flights to San Francisco before their product is even finished.
Furo's case adds one more counterexample to that assumption. A counterexample doesn't break a rule. It narrows the conditions under which the rule applies. Under what conditions does location actually shape an investment decision, and under what conditions does it not? That's the question worth pulling out of Furo's story.
General Platforms and Industry-Specific Startups Look for Different Things in a Location
There are broadly two reasons founders choose Silicon Valley: it's easier to hire talent, and it puts them physically close to investors. For a consumer app or a general-purpose SaaS product, both advantages are real, because the market isn't tied to geography and customers are everywhere.
Energy startups are different. Europe's energy market — with its country-by-country grid regulations, renewable subsidy designs, and utility contract structures — looks nothing like the US market. Under its Energiewende (energy transition) policy, Germany has steadily expanded its share of solar and wind power since the early 2000s, and that process has built up a dense regulatory ecosystem around grid integration and demand response. Landing a first customer in this market takes a utility contact in Munich or Berlin, not a Silicon Valley network.
Furo's return to Germany wasn't a homecoming. It was a move into the market where its product would actually sell.
What Investors Actually Check When They Look at an Address
For founders, location is a signal of credibility. Being in Silicon Valley is supposed to make a team look serious. For investors, an address points to something else entirely: a clue to how — and where — this team will land its first customer.
Energy investors, especially climate-tech-focused funds, treat Europe's energy market as its own thesis, separate from the US. With the EU's Carbon Border Adjustment Mechanism (CBAM) and the REPowerEU policy reinforcing each other, demand for European energy infrastructure has become its own independent investment narrative. To an investor's eye, an energy team based in Germany isn't a red flag on the address line — it reads as a signal that the team is actually inside the market it's trying to sell into.
Founders try to use location to create a signal; investors use it to check accessibility. Sometimes the two calculations line up — in fields like developer tools, AI infrastructure, or consumer apps, where customers are scattered across the world. In those cases, investor proximity matters more than market proximity, and a Silicon Valley address can be a real advantage.
The Cost of a Location Complex
The "location complex" Korean founders often talk about is really two assumptions stacked together: the domestic version that says it has to be Seoul, and the international version that says you can't go global without a Silicon Valley base. Both share the same structure — they're built around what a founder wants to project, not around what investors actually look for.
That complex carries costs in two directions. First, setting up in the wrong city slows down landing a first customer. When a B2B industrial startup sits outside its industry's cluster, every early pilot customer costs more in travel and trust-building time. Second, basing a team in a high-cost city shortens the runway. And a shorter runway changes the timing of when a startup can even meet investors.
Early-stage investors consistently check for one thing: how, specifically, will this team land its first customer? Location gets evaluated as one factor that makes that path realistic — not because of the address itself, but because of the market access the address implies.
Change the Conditions, and the Answer Changes
There's no universal right answer to where a startup should base itself. The starting point is always: where are the customers, and where does the regulation come from?
If customers are concentrated in one region, it pays to be inside that region. If customers are scattered worldwide, investor proximity matters relatively more. In fields like energy, healthcare, or finance, where country-specific regulation shapes product design, a team embedded in that regulatory environment has the advantage. In fields with light regulation or global standards, location matters less.
For Furo, both conditions pointed clearly to Germany. Europe's energy market is both regionally concentrated and heavily regulation-dependent. US investors put money in because they read the signal correctly: this team was actually inside the market it wanted to invest in.
For founders building an industry-specific startup, the order matters: figure out where your customers are and how the regulation is structured, then decide on a location. Find out which city your first customer is in, and which industry cluster that city belongs to — then base yourself accordingly. Choosing a location by chasing investor addresses often means losing both market access and investor access at once.
