High-Tech Wizardry and Entrepreneurial Witchcraft: What Makes Silicon Valley The World Capital of Innovation?

This post is dedicated to the memory of our beloved neighbor Emily Benator.

Posted on May 20th 2012 by Lina Arseneault

What Makes Silicon Valley  the World Capital of Innovation?  Why is it home to high-tech wizardry and entrepreneurial witchcraft? What’s the Silicon Valley  secret sauce and why it is so hard to copy?

Every spring, the newest crop of UOttawa eMBA candidates visits Silicon Valley.  Over the course of their one week trip, the students are exposed to Valley tech companies (from BIG names to startups), VCs, and schools. They network for projects and assignments – all with a view of gaining insights into what makes Silicon Valley such a special place.    Is it something in the water, the air, the food or is it the climate that fuels the innovation DNA so characteristic of Silicon Valley?

The eMBA trip includes an Alumni evening reception.  As an UOttawa MBA alumni and Silicon Valley resident, I’ve participated in this annual function for over 10 years.  Some questions are consistent from one year to the next. These typically include:

  • How long have you been here?
  • What do you do?
  • Why did you move to Silicon Valley?
  • Do you like it here?
  • Can you really afford a house?
  • How many hours do you work? … (The “sweat shop” term doesn’t come up like it did in the late 1990s)? and
  • Do you ever think of moving back to Canada?

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But by far, the most consistent question is always:

What makes Silicon Valley so special?

Thankfully, this year, Gigi Wang was on hand to address that one!  Gigi is the Chair Emeritus of the MIT/Stanford Venture Lab (where she remains on the Board) and is Managing Partner at MG-Team, an international strategic marketing and business development firm for mobile, web services and telecom companies.    In her keynote, she outlined her perspective on “What’s makes Silicon Valley such a special place?”. Needless to say, she did a much better job than I did in addressing this question.

Listen to Gigi describe the VLAB charter.  Follow X|Media|Lab on twitter

“It starts with the culture” she says, “In addition to the excellent institutions and R&D, governmental support, and access to investment capital, it’s the culture that really makes a region like Silicon Valley so unique and wildly successful”.

an article By Anthony P. Sheehan, eMBA 2013

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 She structures her talk around insights or pearls of wisdom. Each pearl includes anecdotes and examples that help to explain the mystic of Silicon Valley.

Need to Trust: trust begins with openness and transparency, it must be mutual or it won’t work.

Risk-taking: Innovation and entrepreneurship requires risk-taking in addition to passion.

“Embrace cultural tourism” explains Gigi, “go beyond your comfort zone, build a prototype, visit a new place”. She goes on to emphasize her final point:  “but most important of all, know that failure is good because mistakes leads to valuable experience and knowledge”.

“I have not failed. I’ve just found 10,000 ways that don’t work.” Thomas Edison

Collaboration People need to share ideas and work on problems together, even competitors

make a bigger pie

This is counterintuitive to most of us. “We guard our ideas and our piece of the pie for fear of losing it”.  “Do the opposite” she explains.  Gigi illustrates the point with how the CEO of Coulomb Technologies, a maker of electric charging stations, openly shared ideas and challenges with a Spanish counterpart.  She describes how the Spanish CEO was floored at this uncharacteristic openness because the two companies target the same market. The executive came to appreciate that “trust, openness and transparency leads to a bigger pie” she says. Make the most of your frenemies.

“In the high-tech world, it’s not about fighting over the existing pie,

but GROWING the pie together.”  Gigi Wang

Integrity: High-level of integrity is required when being open and collaborating

The objective is not about “win-lose”. It’s about give&take and that win-win-win is the objective. She explains the three pronged win as being the success of company, employees and partners in the service of customers as espoused by Groupon founder Andrew Mason.

Accessibility:  access to experience and resources to new entrepreneurs

Gigi’s advice to budding entrepreneurs and leaders: be open, reach out.  “Don’t wait for an introduction; take the risk to introduce yourself”.  As for successful and seasoned entrepreneurs; she suggests that they reach out to young entrepreneurs and share valuable advice and learning.

Lee Fraser, President of the Canadan California Business Council (CCBC) was also on hand that evening. To reinforce the point on accessibility, he cites the C100 as one of countless mentorship program in that regards. C100 is comprised of a select group of Canadians based primarily in Silicon Valley, including executives of leading technology companies, experienced startup entrepreneurs and venture capital investors.  C100 is dedicated to supporting Canadian technology entrepreneurship and investment.

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Constructive Feedback: you must understand what you’ve done right and what you’ve done wrong

Develop and refine your “pitch” skills, embrace continuous learning
  • Stanford offers more free online classes for the world:  Last fall, 356,000 people from 190 countries expressed interest in one or more of the first three classes offered, and approximately 43,000 successfully completed a course. Participants came from as close as Stanford’s Palo Alto campus and as far away as Ghana, Peru, Russia and New Zealand.

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Jealousy (and lack thereof): instead of being jealous when someone else does better, it is viewed as an opportunity to build a relationship with someone successful

The need to develop the right culture and summarizes its key characteristics as:
  • Openness
  • Collaboration
  • High-level of risk-taking, and
  • The “people networking” environment.

“We must instill high integrity into the next generation of global citizens” says Gigi.

“There’s definitely a sense of equifinality in the Valley whereas the success of one does not diminish the likelihood of someone else’s success” says Anthony P. Sheehan, eMBA 2013.

Referencing Wikipedia’s definition of innovation, she couches her concluding remarks as:

Silicon Valley Innovation

Innovation is the creation of better or more effective products, processes, services, technologies, or ideas that are accepted by markets, governments, and society. Innovation differs from invention in that innovation refers to the use of a new idea or method, whereas invention refers more directly to the creation of the idea or method itself.

  • Create what the market wants, and
    • Design exceptional products
    • Conceptualize, design and prototype
    • Collect lots of feedback, lots of it
    • Iterate, iterate, iterate
  • Market creatively

Highest Paid Person’s Opinion

I especially liked Gigi’s closing comment on the root of innovation:

innovation from the bottom is ‘chaotic’ whereas 

innovation for the ‘top’ is ordered.

Silicon Valley innovation is clearly “chaotic” and that’s what makes this place special.

Long live high-tech wizardry and entrepreneurial witchcraft!

Additional Information:

References:

Silicon Valley   wiki reference

Sign commemorating the site of Schokley Laboratories. Instagram Photo taken by me in 2011.

NPRThe Birth Of Silicon Valley: A Timeline  (This graphical presentation covers the period from the formation of Hewlett Packard in 1938 to the 1971 first appearance of the nickname Silicon Valley in print.  Includes a picture of the garage where William Hewlett and David Packard founded Hewlett-Packard Co. in 1939)

NPR:  3 Part Series on Silicon Valley by Laura Sydell

A History of Silicon Valley: The Greatest Creation of Wealth in the History of the Planet by Piero Scaruffi and Arun Rao

A Guided History of Silicon Valley:  iTunes App:  Silicon Valley Roots & Shoots

iTunes App, an insider’s guide to the companies, people, and products that created this vibrant center of high-tech innovation.  More info  Tracking down the roots (the pioneers) and shoots (the spin-out companies) of the digital revolution is made easy with this unique guide to over 150 locations and resources in the southern San Francisco Bay Area cities, campuses and industrial parks.  Each location has many photos, concise descriptions, maps, and links to additional information.

Age of the Inspired Riff: Learning from the Golden Gate on its 75th  via The Wall Street Journal

Steve Jobs by Walter Isaacson

Imagine: How Creativity Works by Jonah Lehrer.  Includes a section on San Jose and Silicon Valley.

Cisco Acquisition Strategy

In The Plex: How Google Thinks, Works, and Shapes Our Lives by Steven Levy

Facebook’s History: From Dorm To IPO

Tesla Motors was founded in 2003 by a group of intrepid Silicon Valley engineers who set out to prove that electric vehicles could be awesome.

SiliconBeat  The people and companies driving the innovation of Silicon Valley

The Silicon Valley Way, Second Edition: Discover 45 Secrets for Successful Start-Ups by Elton Sherwin

Silicon Valley Community Foundation

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Comments

  1. Christine says:

    Thanks Lina for this post.
    This is so refreshing! There is indeed a region in this world where people try to make the best of our collective good.
    Being back in Europe for the past couple of years, I can feel the difference…
    There is a large pool of bright, talented, technical guys around here, but it is too often fighting for a (limited) pie as opposed to growing that pie by looking outside and think market/customer (not nm/GHz).

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