The myth of Silicon Valley


Since I remember myself as an electronics engineer, Silicon Valley has been the holly grail of technology innovation, a mythical place that as an aspiring young engineer you just wanted to be in! It’s been a while now that I see, maybe once every month, a post in the media talking about the Silicon Valley paradigm, phenomenon, culture and discussing ways to replicate it in Israel, London, New York, Kuala Lumpur, you name it! Yes, it would be nice for a nation’s economy and for the legacy of many politicians to just do that, I agree …but, wait!

What exactly is Silicon Valley, that everyone wants to replicate?

In this post I will try to touch the myth of the valley with the help of an excellent post written by Russell Jurney and Bradford Cross, titled “The Next Silicon Valley”, unfortunately no longer on-line. Please take note of the time periods and the sizes of the community, as stated in the excerpts (italics) from the aforementioned post, perhaps this will explain the culture of the valley, at least to some extent.

The history (yes that boring part…)

San Francisco had a lot going for it at the turn of the 20th century. It was an energetic and adventurous town still characterized by the pioneer spirit of the California Gold Rush of 1849. San Francisco’s population boomed from 35,000 in 1850 to more than 400,000 by 1911 – nearly half its present population. A Phoenix city arisen from the rubble of the 1906 earthquake, in San Francisco anything was possible. – New community

Leland Stanford was an attorney in Wisconsin when his office went up in flames in March, 1852. Stanford and his wife Jane Elizabeth Stanford went west, following his five brothers to California where he joined them in operating a general store… The tragic death of their only son, Leland Stanford Jr., left the Stanfords without an heir to their fortune. They decided to ‘adopt the children of California’ by founding Leland Stanford Junior University… Progressive from its inception in 1891 – Stanford was both coeducational and tuition free… At Stanford, this idealism of applying research in new ways has always been the norm. – Idealism

The descendants of gold miners and pioneers, Californians were always early adopters and innovators. California led the nation in adopting agricultural mechanization, and it was in San Francisco that the first ship-to-shore radio transmission in North America took place at the Cliff House on August 23, 1899. This was one month before Nobel prize winner Gucilielmo Marconi, who started the first telegraph network, arrived in New York from Europe. Radio spread through the Bay Area like wildfire. The first full-time radio station with regular programming was in San Jose, and by the 1920s the Bay Area had more operating radio stations than any other city in the world. – Technological Innovation

Frederick Terman joined Stanford’s engineering staff in 1924 and set out to build a world-class electronics program… He aggressively integrated Stanford’s electronics labs with local industry, going as far as to send academic ‘agents’ to local companies to learn their techniques and reproduce them in Stanford’s labs. He encouraged students to commercialize their research, including Bill Hewlett and Dave Packard. – Serendipity, Leadership & Extraordinary Talent

Following a post (1941-1945) at the Radio Research Laboratory at Harvard during the second world war Terman pursued policies to increase Stanford’s military research and development budget… With lives on the line, quality was king, and components from the bay area were superior to any others available at that time. They got the contracts, and the industry grew. – A War & Government Contracts

In the video below, Steve Blank gives a quite comprehensive view of the Secret Silicon Valley, covering all the cold war period. – No Competition

Cultural and geographic forces led to the Bay Area’s early lead in radio technology, and the radio economy grew into industries based on radio technology and then beyond. It did not arrive at them by coincidence or by central planning. Silicon Valley had an early lead, and was nurtured, not directed, into what it wanted to become. – No Government Direction

I will not try to make more historical references, this post will get ridiculously long… Should you want to study  this further, here is a great link ->

The Myth (now I am going to hear it…)

I am not a resident of the valley, although I have been to the valley sometime back in 1996 and 1997. Actually, I remember listening to Sergey Brin talking to a San Jose radio station about their new search engine… Google! 🙂 Perhaps you may say that I am not qualified to try to explain the myth, however as a global phenomenon Silicon Valley is perceived by all of us in several ways and I believe it needs to be explained and understood in the local context of each one of us.

ESC West - Katerina, Alex and I (left), visiting the valleys sometime in 1996.
ESC West – Katerina, Alex and I (left), visiting the valley sometime in 1996.

Russel and Bradford gave a definition of Silicon Valley as “an economic cluster. A network of networks, rich in financial and social capital spanning every area of technology, all focused on developing and commercializing new technologies.” Also, they state “Cultural and geographic forces led to the Bay Area’s early lead in radio technology, and the radio economy grew into industries based on radio technology and then beyond. It did not arrive at them by coincidence or by central planning. Silicon Valley had an early lead, and was nurtured, not directed, into what it wanted to become.” Rightfully they claim that it is the culture of Silicon Valley that surpasses any other attribute of the valley “In silicon valley, entrepreneurship is a profession and startups are an industry. This is part of a culture of both bold and calculated risk taking, alongside an acceptance of failure. The valley culture is the one factor that trumps all others.

However, if I can may make a few observations, the chain of developments in the valley is intriguingly leading me to a thought: Is it all chance?… or is it not? Imagine if Stanford’s office back in 1852 did not catch fire and he never moved to San Francisco, or his son did not die, inherited this father and Stanford University was never established… where would Terman had the chance to teach? 🙂 …no, I will not go this route, don’t worry!

If you noticed, I have been making some remarks (in bold) next to the excerpts from Russel and Bradford. These are in my opinion the significant points in the evolution chain of the Silicon Valley that made it possible to exist:

Silicon Valley has taken over 100 years to develop and mature to what each one of us perceives today. It started initially by a new community of people in which prominent and wealthy people driven by idealism invested in education focused in technological innovation. Serendipity brought extraordinary talent to the valley and prominent academics with leadership skills transformed a war effort to  government contracts that lasted for decades. No government direction was orchestrated, although the government military contracts provided the resources for the area to flourish beyond commercial competition. During this 100 year long period of development, entrepreneurship became a profession and startups an industry.

So, what do you think of that area that you want to transform as the next Silicon Valley? How do you plan to replicate the sequence of events that will eventually create something similar to the Silicon Valley phenomenon? Do you have the scope to wait for a century-long evolution? Will you provide non-competitive government contracts to startups so that early investors can minimize their risks and create a startup industry?

One thought on “The myth of Silicon Valley

  1. The “Silicon Valley” cannot be replicated!! It was mainly an idea that came to become a reality through circumstances. This is common in human history!

    A new “Silicon Valley” may be forming somewhere in the world, as we speak, that may take its own path to formation and achieve its own importance!

    We know start ups are springing around the world! What is needed is to find methods to fund the ideas and the people behind them! It seems, with today’s technology, this will be achieved with digital methods and over the Web! Stay tuned!!

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