
Why It’s So Hard to Build the Next Silicon Valley - adventured
https://www.bloomberg.com/news/features/2017-02-28/why-it-s-so-hard-to-build-the-next-silicon-valley
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gozur88
I don't see why anyone would think fast internet access is the key to "the
next silicon valley". Silicon Valley existed as a tech hub before the
internet, and all sorts of cities across Europe and Asia have fast internet.

Silicon Valley is going to be difficult to displace for the same reason
Facebook is difficult to displace - the network effect. Companies come to the
SF bay area looking for talent, and talent comes looking for jobs. You can
start your company somewhere far cheaper (an nicer, IMO), but people who are
used to switching jobs every 18 months are going to be a hard sell on
relocation.

~~~
blackguardx
You make good points, but it is hard to imagine a tech boom taking off in an
area with poor internet access.

~~~
simplehuman
So is electricity and water. Can you make a good silicon valley with kick-ass
water supply? The article's premise is broken.

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CydeWeys
The article completely overlooks social issues. Tech people may span the
fiscal political spectrum, but they tend to be progressive as far as social
issues go. Kansas does not have any appeal to most of the tech people I know
for that exact reason. They've even rejected the Medicaid expansion for the
ACA, which is a useful social safety net for early stage founders with
unsuccessful startups.

~~~
ninguem2
I don't think statewide social/political issues have much bearing, otherwise,
e.g., Austin wouldn't be as successful as it is. Locally progressive is
important. I don't know how Kansas City fares in that regard. A University
nearby with a strong CS program is important and Universities usually bring
with them the progressive crowd.

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khazhou
Is Austin doing well? I keep hearing "Austin has tech!" but I've found it hard
to find impactful companies there. It seems like every year when I look them
up, most of the companies from the year before have disappeared (minus Dell,
Apple, Google offices).

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pm90
What are you talking about? Which companies have disappeared?

Among different companies in Austin: Apple, Amazon, Dropbox, Cloudfare,
Twitch, Facebook (not engineering though...sigh), Blizzard, EA, Intel, ARM,
Samsung ... I can go on, but I think I've made my point.

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simplyluke
It's not the internet, it's the people. Why isn't KC the next silicon valley?
There's not a stanford & Berkeley right there congregating some of the most
talented young & ambitious kids in the country.

The "next silicon valley" will be wherever a high percentage of extremely
talented young adults congregate and collaborate and have access to resources
necessary to grow a company. Being able to download a lot of stuff really fast
isn't really a necessary condition for that, even if it helps.

~~~
Clubber
>There's not a stanford & Berkeley right there

This is absolutely a fundamental reason: higher educational system. Atlanta
(maybe Texas) is the South's version of SV and it has Georgia Tech, Emory, and
others. If a municipality wants to be a top tech city, it needs the colleges
and universities to support that.

~~~
simplyluke
Austin has UTexas as well, which is a major driver of it being a hub.

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JamilD
The difference to me is cultural — it's not about infrastructure or fast
internet at all.

It's hard to explain how it feels for me, when I get to the Bay Area. Being
able to talk to like-minded people, not feeling like an out-of-place weird
nerd like I do at home. It's no coincidence that I made most of my friends out
there.

And anybody I've met that generally wants to "emulate" SV elsewhere generally
has entirely the wrong mindset — trying to copy (badly) the investment style,
their view / the mainstream media view of "startup culture", etc; it's
completely misguided.

~~~
edblarney
Most tech bubbles develop that pretty quickly.

Admittedly, California has a little bit of that going for itself.

1) California is naturally aspirational, it's 'quirky' and the place that
people have gone to 'escape' classical norms for a few centuries now.

2) The weather is amazing.

3) It's in the USA = a market big enough to support anything to start, before
international expansion. Almost nowhere else can do that. Think Sweden: you
have to go 'very international' and deal with many cultures/languages to get
going.

4) Standford/Berkley - almost the perfect mix of both public and private ethos
in the same spot. I'm not for or against either, but both systems have
advantages. Also proximity to other pretty good schools.

5) SF artistic culture + VC culture + Tech culture - I would argue all are
needed, and it just happened to be there before, and now they have a mass in
all three. Granted, the art-vibe is dwindling.

6) Money - another thing that comes from both US scale and capitalist culture,
that doesn't exist most other places. Rich people write big Angel cheques and
take risks like few other places.

It's crazy to try to 'reproduce' the Valley elsewhere - it's best to focus on
things that regions have as an advantage.

Canadians are not the most capitalist/lean-in people (I know this, I am one),
and we don't fare well on R&D spending etc. But - the Oil Sands are almost
unique to Canada, and developing around that are tons of relevant mini-
innovations and side industries. (Eco-issues aside, but even then - some eco-
innovations as well).

Montreal has a huge 'creative community' that they don't leverage well enough.

Sweden has a specific kind of culture that has lent well to their exports and
innovations espcially in Music. They are a world powerhouse in pop-music ...
Spotify should be no surprise.

When industries are related, or if there is a 'key advantage' somewhere in the
core, then other, related inustries can leverage that.

'Critical masses' happens when there is some kind of relationship between the
various companies.

Trying to 'just make startups' wherein there is no synergy between entities is
not a good strategy.

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santaclaus
> 1) California is naturally aspirational, it's 'quirky' and the place that
> people have gone to 'escape' classical norms for a few centuries now.

Is this still the case? I could sort of see this in the 60s, but present day,
living in the bay area it feels pretty home-owner-associationy. In Oregon in
the city we had neighbors who performed a ritual pagan goat sacrifice in their
back yard -- I kind of don't see that flying in Palo Alto.

~~~
edblarney
Point taken. Less so than before, but it's still fairly weird in many areas.
LA and the Bay both have odd sub-cultures and not-so-far out of the city you
get some fairly hippy types, but it depends on a lot.

Palo Alto I don't think has ever been quirky.

But yes - maybe Portland is the new SF :)

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avenoir
It runs a little deeper than faster internet access. Missouri and Kansas seem
to share the same 2 problems - bad public schools (especially in MO) and
mediocre computer science programs. I'm a remote employee (but used to live
here) for a small tech company in the KC area. One thing that stands out is
that it's unbelievably hard to find half-decent interns from surrounding
schools. We still attend career fairs but have pretty much given up on local
universities. My boss basically uses his free time to scavenge High Schools
for potential candidates. We've had luck with 2 kids so far and both have
moved on to ivy-league schools to pursue CS after interning with us. I can
almost guarantee you that neither of them is going to come back to the area
and I wouldn't blame them.

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jandrewrogers
I have thought about this a lot for many years, and I have lived in or spent a
lot of time in parts of the country and world that desire to have a tech
community like Silicon Valley. In my estimation, there are three critical
ingredients that intersect with "culture" but are not contained by it. In no
particular order:

\- A critical density of engineers as a percentage of the population. Few
places have as many engineers per capita as Silicon Valley but in the places
that do it drives the dynamics of the culture (e.g. Seattle).

\- Strong lack of risk aversion. This I would argue is Silicon Valley's most
unique trait. When combined with its other traits, good things happen.

\- High average wealth above some threshold that is well distributed in the
local population. Again, there are a few cities such as Seattle that meet this
criterion but they are not common. It may merely be a correlation with
engineer density.

This is what led me to move to Seattle six years ago after many, many years in
Silicon Valley. Seattle (relatively) is more risk averse but it also lacks
many other pathologies while having the other critical ingredients (engineers
and ambient money) in spades. With the number of Silicon Valley (and New York
City) people that I know that have moved to Seattle, I am seeing even the risk
averse aspect change over time.

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beambot
Required reading: Steve Blank's "Secret History of Silicon Valley"

[https://steveblank.com/secret-history/](https://steveblank.com/secret-
history/)

TL;DR: It took decades, spanning back to defense spending in the 1950s and
included advances such as radar, ICs, PCs, & the internet.

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prostoalex
It's relatively easy to set up a brand new start-up anywhere in the world.
It's also possible to grow it from 2-3 founders to perhaps 100 employees.

Growing the company after that is somewhat problematic, as one needs
engineers, marketers, business developers and recruiters in rather large
quantities. A company that's growing from 100 to 1,000 employees will have to
resort to importing such people from Silicon Valley, but what would motivate
those people to move?

Some can be attracted by the premise of cheaper housing, better schools,
easier commute or, as the article suggests, faster Internet. But they also
have to consider the risks of

* lost opportunity cost (a rapidly-growing rocketship startup shows up in 2 or 3 years, eyeing this exact engineer, and is most likely to be located in SV, not in Topeka)

* spousal unemployment

* lack of fallback scenarios for layoffs, team/manager mismatch or just plain burn-out, where you happen to work for the only major tech employer in town

With that said, Snap managed to grow from 0 to 1,500 employees in LA, and I'm
sure there are some NY companies in the same league, so things are possible.

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dorianm
Paul Graham's "How to Be Silicon Valley"
[http://www.paulgraham.com/siliconvalley.html](http://www.paulgraham.com/siliconvalley.html)

~~~
bobosha
related:
[http://www.paulgraham.com/america.html](http://www.paulgraham.com/america.html)

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simplehuman
What does fast internet have to do with silicon valley? Senseless article.

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deftnerd
Agreed. In fact, if I remember correctly, San Jose, Sunnyvale, Santa Clara,
Mountain View and Palo Alto notoriously have crummy internet speeds
considering their "tech" cachet.

~~~
magila
Indeed, most of Silicon Valley is effectively* under a Comcast monopoly. As a
result, it gets the same crappy, overpriced service as most of the country.

* There are technically other service providers, but they are not competitive if you want more than 20Mbps of throughput.

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Hoista
One of the key things that makes Silicon Valley unique beyond network effects,
is the number of early adopters there. This helps to iterate and test the
product much faster and lower cost than reaching out around the country/World
for early adopters when still prototyping.

Hard to replicate a culture of early adoption and willingness to try new
things.

~~~
simplyluke
You seem to be getting down voted a fair amount, but I think this cultural
attitude is real and a necessary condition. Anyone who's lived on the east and
west coast is aware that they have very different cultures, and I'd argue the
west coast is a lot more willing to break the old ways.

~~~
edblarney
It's true - but the early adopters are usually related to the industry anyhow.
So they are almost the same thing.

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imthebigfoot
There is this video doc from wired on YT, about how Shenzhen in China is the
next SV, for the following reasons : the city is thriving, it has the highest
number of high rises "in the history of mankind" (to quote that lady in the
show), and because it has access to cheap cheap HW components, right down your
office.

Just as comments below say, it takes more than having wide spread fast
Internet access to be able to replicate the SV. It also takes more than having
access to cheap HW components. It also takes more than having access to dirt
cheap computer programmers. That's why Shenzhen is not the next SV, neither is
New Delhi or Bangalore. Plus, in Shenzhen, I assume the State gov. maintains
all the control it can over whatever is going on there. This goes against the
SV start-up culture of freedom of entrepreneurship and freedom of thinking and
freedom of capital circulation.

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empath75
If you want to build the next Silicon Valley, you have to build the next
Stanford first.

~~~
EduardoBautista
The east coast US and the U.K. have many universities on par with Stanford's
quality.

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surfmike
Fast internet has nothing to do with it. You can easily get faster internet in
many European cities than in SV.

Culture and capital are the two differentiators, and they're hard to recreate.
Investors are willing to bet money on so many crazy ideas.

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singularity2001
the next Silicon Valley won't have Silicon in its name. Maybe AI gorge.

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romanovtexas
This should have been titled "A brief history of Google Fiber" instead.

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known
It's zero-sum like in bloom.bg/1O04ymn

