Instagram is a smartphone app that Facebook now owns. According to an article that discusses the climate for software firms in the San Francisco Bay Area, the success of Instagram "is a tale about the culture of the Bay Area tech scene, driven by a tightly woven web of entrepreneurs and investors who nurture one another's projects with money, advice and introductions to the right people." What advantages does being located in the Bay Area give to startup software firms? In what circumstances can software firms located elsewhere overcome these advantages? Are the advantages the Bay Area has likely to persist over time?