Snap is a big deal for L.A., but it’s still no San Francisco.
Messaging service Snap’s IPO gave Los Angeles’ burgeoning tech scene a big win, but Silicon Valley still dominates in venture capital deals by both value and volume.
What does that mean for L.A.? In the newsletter Term Sheet, Erin Griffith points out that having a big public tech company can play a big role in helping encourage other entrepreneurial ventures nearby. For other area entrepreneurs, that company is “one that will hire you if your startup fails, one that will mint angel investors and maybe even a ‘mafia’ of next-generation companies and investors.”
However, L.A. is still a relatively young tech scene, and the data show it’s still a far cry from the Valley in terms of VC deals. Snapchat could be a decent start in helping close that gap.
A version of this article appears in the March 15, 2017 issue of Fortune with the headline “No, Really, Don’t Call It ‘Silicon Beach.’ “