Tech’s Post Silicon Valley Future

For a long time, it was believed that Silicon Valley was unduplicatable. Mahy believed Silicon Valley could only exist here in California, in its unique little bubble in the Bay Area. For a long time, it did seem that this was true. I’ve spoken with countless State and City officials in many other states all looking to find the secret of the valley that could help their city or town change its economic fortunes for the better. Silicon Valley is finally getting bigger than Silicon Valley. This is partially a function of this pocket of the world running out of space and becoming too expensive not just to start a company but even run a company. A more important fundamental point is that technology itself, all the core things that were said to exist in Silicon Valley is penetrating every industry. We are on the cusp of an inflection point where there is no longer a designation of technology industry, but every industry is a technology industry. With that in mind, it is worth knowing what truly makes Silicon Valley unique.

A Wealth of Experience
Most people think the uniqueness of Silicon Valley is its culture where a focus on innovation and pushing the envelope. While it is true, there is a unique culture in the Valley that is not the hardest part to duplicate elsewhere. Another line of thinking is access to capital. It is true most the biggest VC firms in the world are all in the Valley, they don’t just invest in valley companies, and there is growing presence of top-tier investors in a growing number of cities. The most salient angle, I’ve always agreed with was a willingness to take risks that exist in the valley. This certainly was true historically, but younger entrepreneurs around the country seem much more willing to take risks than previous generations and therefore a culture of risk is a short-term advantage of the valley.

The Valley’s biggest differentiator, in my opinion having grown up here, started companies here, and spent my career here, is a wealth of experience. For now, Silicon Valley has a wealth of access to business leaders, investors, mentors, etc., who have been around the block so many times that their experience and knowledge becomes invaluable. This is the one thing no other area in the world has. But, I think it is clear, even this is a short-term advantage of Silicon Valley.

National Expansion of Corporate Headquarters
To pursue a diversity of talent, companies are expanding their corporate presence to locations outside of Silicon Valley. One of the more notable recent examples is Amazon deciding to build their additional headquarter hubs in New York and Virginia. Having a company like Amazon build not just a satellite office but a new hub is key in growing and developing talent and helping an area gain invaluable experience that will benefit the local business scene.

As we look at the pockets of tech talent emerging across the country, it seems like areas outside the valley are starting to develop specific expertise, talent, and experience. For example, New York is becoming a hub for FinTech (or financial tech) services. Which makes sense given the financial and banking epicenter New York has always been. Similarly, in Los Angeles, we see tech startups emerge with a more specific focus on media and entertainment.

As new areas emerge as tech epicenters, it is logical they will each have their unique expertise and talent pool. This will be a boon for local economies but may also spark another key ingredient for local economies success.

Educational Focus
One of the key parts of the Valley’s success is Stanford, and Berekely to a degree. Stanford’s business school remains one of the most attractive places for an aspiring entrepreneur or aspiring business leader. This has everything to do with its location close to such pervasive startup culture, but also because of the business leaders who teach classes as guest professors or lecturers. It is one thing other schools are challenged to compete with because most the top VCs, entrepreneurs, and more, all live in the Valley which makes it easy for them to get over to Stanford and teach classes or programs.

The local educational ecosystem is a huge part of the Valley’s success as it breeds future business leaders and they, more often than not, stay local to start their companies. This is the one thing that other economies need to duplicate where the local colleges and business schools attract new talent, develop relevant curriculum, and incentivize students to stay local to start their companies.

Ultimately, all these parts are interlocked as the underlying building blocks for new pockets of business and tech economies to flourish. While it won’t happen overnight, it feels like the trend is to build new tech epicenters in other states and that the success of other areas to have their own unique high-tech ecosystems. Build tech jobs, have successes of those companies in either IPO or acquisition, and keep those experienced leaders local to pour back into the local ecosystem.

It won’t happen everywhere, but the recipe that allowed the Valley to flourish seems like it is starting to show up in other places. They may not all look alike, and that is a good thing, but the trend seems clear, and it is a positive story for the US economy and many local cities and states.