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Start me up....

  • Darren Waters
  • 6 Mar 07, 03:59 PM

What is it about the culture and climate of Silicon Valley that produces so many start-up firms?

It's a question I'll be looking at for a feature on the ΒιΆΉΤΌΕΔ News website.

Is it the critical mass effect? Is it the proximity of Stanford and Berkeley?

What makes a bunch of 20-somethings want to risk their livelihoods on a whacky idea?

And is it unique to the Valley? Does Britain produce its fair share of new tech firms?

"No-one considers you a failure because you've had a failure," was how one head of a start-up explained it.

I'm talking this week to companies like Meebo, Zooomr, Yelp and Stumble Upon who all have one thing in common - their founders are young, bright and bold.

I'll be profiling these execs in a series starting next week on the website.

I'm keen to hear of any other examples and your reasons for this remarkable concentration of talent.

Comments   Post your comment

  • 1.
  • At 10:46 AM on 07 Mar 2007,
  • Tom Douglas wrote:

I like the ΒιΆΉΤΌΕΔ's coverage of technology but it is failing science

  • 2.
  • At 11:05 AM on 07 Mar 2007,
  • Scott wrote:

I lived in Silicon Valley for six months back in 2002 and the impression I got was that Americans don't consider failure the way we do. They look on it as a positive learning experience and one to work from. You can even find yourself getting a pat on the back, nice try, keep going sort of mentality.

Britain loves a loser and any failing whether in business or any other area seems to be punished. I started my own IT business a couple of years ago but had to close it down as it wasn't working. Why do I feel nervous about putting this on my CV? Simple, because most prospective UK employers look on it as negative.

  • 3.
  • At 12:57 PM on 07 Mar 2007,
  • Michael wrote:

I worked in Silicon Valley during the dot com boom between 1996 and 2001. For an engineer, companies really consider the fact that you have gained hardware or software design experience more important than whether the product sold and the company took off or not. Everyone I met had stories about the state-of the-art projects they worked on, failed to make it simply because of a rival system that was being developed at the same time or simply because it was announced at the wrong time (the market wasn't ready or missing an important release date such as the Christmas buying season).

As a Brit who moved to Silicon Valley in the 1990s I think one factor that is often overlooked is the impact of employment contracts on people's ability to set up their own company.
In the US, an employee can leave without notice, so you can't be forced to take gardening leave while your prospective clients go elsewhere.
Secondly, if you work on designing a website in your spare time, your employer has no right to stop you, and no rights to the end product.
Most importantly (and unique to California), non-compete clauses in any employment contract are illegal, allowing you to walk out and set up in competition with your employer the next day (a great opportunity for all those web designers and consultants).
Perhaps the UK should reconsider whether the protections it gives to employers are actually counterproductive when it comes to entrepreneurship?

  • 5.
  • At 01:24 PM on 07 Mar 2007,
  • David wrote:

I think people in the UK lack the get up and go of americans, we moan about this and that and we never really take it on ourselves to sort out our real problems. America makes more money, but they work harder and longer for that money and we must realise that. In the UK the interaction of PhD students, reseachers and acedemics with Entrepreneurs is just non-existant. We do not have a culture that allows colaboration on that sort of scale, and anything new to the market is generally avoided, becasue most people think there is a catch.

  • 6.
  • At 01:55 PM on 07 Mar 2007,
  • RPierson wrote:

How else do you learn, I've started 3 business's and two failed, this one is doing well. It just took a while to figure it out, the upside, my failures are mine and my successes are mine. The downside, roller coaster income but that just makes you budget better :-)

  • 7.
  • At 01:57 PM on 07 Mar 2007,
  • Richard Kendall wrote:

I am a Brit living in the valley and have been here for the last five years. In addition to the "right to fail" attitude I would also say that Silicon Valley has the right critical mass to attract some of the brightest and best academics, engineers and entrpreneurs from all over the U.S and the rest of the World. The venture capitalists are also a great catalyst to making the valley tick. Though it has to said that the local economy is not what it once was. The bursting of the dot com boom left unemployment in its wake and a less bullish outllok for the future of high tech here.

  • 8.
  • At 01:58 PM on 07 Mar 2007,
  • Ryan wrote:

What Scott wrote is very true, I mean with regards to here.... I would love to start up my own business in the development and production of unique electronics, but, I can’t for the fear of failure..... Failure here represents a major hold of your potential future.

While at university I failed many subjects, and sometimes my lecturers would look and advise maybe to choose other roles, but, I have always been so headstrong that I knew I could achieve. Although back then I had nothing to lose and a good qualification to gain. Now its different if I fail potentially I could end up with lots of debt putting me in a really financially dark place.

For me the financial aspect of starting a business and the potential negativity surrounding that failure could be very destructive. It takes a vast amount of time to research and develop a product to a β€˜quality’ releasable level, even before, you safety test something or ensure other standards are met; potentially you are bust before you begin.

I am in my 20's with nearing 3 yrs experience in the field; the risk is just too high at the moment. The Tech industry is so volatile.

  • 9.
  • At 02:08 PM on 07 Mar 2007,
  • Raja Shekhar wrote:

I'm not an American, but lived long enough to know the difference between various view points. Including how different societies treat failure. I come from a society where if you don't achieve your goals it's considered a failure. However in USA people treat your effort a failure if you don't attempt it and give your best (100%). Failure is not an end for an entrepreneur in USA it's a road block who needs to learn from this experience and know how to overcome those hurdles. This thought process gives its citizens an extra strength when then wants to try a radically different idea and see it take its shape and be used by everyday folks.

  • 10.
  • At 02:17 PM on 07 Mar 2007,
  • RPierson wrote:

How else do you learn, I've started 3 business's and two failed, this one is doing well. It just took a while to figure it out, the upside, my failures are mine and my successes are mine. The downside, roller coaster income but that just makes you budget better :-)

  • 11.
  • At 02:25 PM on 07 Mar 2007,
  • Lateef wrote:

Someone at Intel put it like this "To increase your success rate...double your failure rate"
A kind of iterative process. For practical solutions to real world problems, it produces great results. Be it building a successful company or mixing the best punch. Those bold enough to loop through the failures get the dough. I can definitely say it's an attitude thing. The right attitude.

  • 12.
  • At 03:03 PM on 07 Mar 2007,
  • David wrote:

I think people in the UK lack the get up and go of americans, we moan about this and that and we never really take it on ourselves to sort out our real problems. America makes more money, but they work harder and longer for that money and we must realise that. In the UK the interaction of PhD students, reseachers and acedemics with Entrepreneurs is just non-existant. We do not have a culture that allows colaboration on that sort of scale, and anything new to the market is generally avoided, becasue most people think there is a catch.

  • 13.
  • At 06:32 PM on 07 Mar 2007,
  • Jalpan Dave wrote:

Though Britain has lagged behind its American counterparts in terms of start-up companies, an awareness of this has been created and steps have been taken to rectify it. The finest example is, in my opinion, the formation of the Cambridge-MIT Institute (CMI).

The answer to why the UK has lacked in this aspect lies in the statement that his excellency Mr. Gordon Brown made in which he explained the reason behind forming the CMI: "To bring the entrepreneurial spirit of MIT to British Universities."

As one would have guessed, it is the SPIRIT that is lacking.

Lets journey back into the past. The world's first digital computer was made in the University of Cambridge and the internet was invented by Sir Tim Berners Lee. However, Britain lags behind not only USA but also a developing country like India and China in the field of computers and IT. For example, I am typing this on my TOSHIBA laptop while checking my mails on Yahoo! neither of which are from the UK!

The problem is that though Britain produces academics and research papers of the finest quality, it does not instill skills of entreprenuership in students.

To produce more and more "spinout companies" as they are called, we need more and more cutting edge research as well. Herein lies the second problem. UK has far too less Universities that are truly world class and can attract brilliant students. The big names are nearly always only Cambridge and Oxford.

Being an Indian, I can state with conviction that in my country, when asked about Universities in UK, most people only know of Oxford and Cambridge. That was the cas with me as well. Only by stumbling onto its website did I find out that there is something called "Imperial College London" which is actually better than Cambridge in Technology.

Thus, the last measure that needs to be taken is the contruction of a Technology Transfer company of EVERY University. For instance the technology transfer company of Oxford is Isis Innovation.

The paradox is (if I'm not wrong) that Cambridge found its tech transfer company (Cambridge Enterprise) just months ago while it is going to celebrate its 800th anniversary after a couple of years!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

  • 14.
  • At 06:41 PM on 07 Mar 2007,
  • wrote:

It is a bit simplistic to say that Americans have a get-up-and-go attitude that Britons lack. This country is littered with Britons who are very successful in their chosen field, or as entrepreneurs, and one would therefore surmise that they could do the same at home. A native Dutchman, I tried and failed to build an enterprise in England, and the primary cause for this was that I could not get my hands on investment capital sufficiently quickly. In the US, where I then spent 15 years in R&D (on the other coast though), there is a prevailing "show it to me" attitude. If you have an idea and you're sufficiently pushy, you're given the benefit of the doubt, if you have done your homework and you can demonstrate you've thought your plan through, American culture will reward you with an opportunity to prove what you created will work - and, as we say in New york: "You get one second chance". The reason is simple - the United States is the world's money machine, and you can only make money though innovation and by having new products and services to sell. So the American economy needs its entrepreneurs, because without them the production motor behind Wall Street would grind to a halt. In more traditional cultures in Europe, money is a means, not a goal, and there is less pressure to create markets, and more on maintaining them, which doesn't require us coneheads. I remember well my accountants in the City, who were very positive about my plans for growth, and told me to get a business plan ready, and it would take about a year to raise the funds I was looking for. I folded the company, negotiated with the Receiver so I could keep my Miami office, and I packed up and left. Never looked back - and I reckon I created some 5,000 direct and indirect jobs, and half a billion dollars in revenue for the American economy in the 20 years since. We all have get-up-and-go, it is just which Petri dish you're in that determines the outcome.

  • 15.
  • At 06:49 PM on 07 Mar 2007,
  • wrote:

Was it Confucious or the Buddha that said this? ... "A bullseye is the result of 100 misses."

  • 16.
  • At 06:56 PM on 07 Mar 2007,
  • Jalpan Dave wrote:

Further to my previous entry in which I stated that even Brits do some real cutting eadge research in technology, I would like to add that most theories on Management and Business is done in USA.

UK needs to realize that the field of Businees and spinout companies is also one where masses of research can be done!!!!!

  • 17.
  • At 07:42 PM on 07 Mar 2007,
  • Katherine Grosskopf wrote:

Raja is right when he says that the way to fail here (in the US) is not to try or just to give up. The way to fail is to let your talents go to waste. Being an entrepreneur, especially when it comes to technology, is an accepted and even encouraged career move. As for Silicon Valley itself, that's where the venture capital firms are looking, that's where there traditionally are ambitious kids just waiting for an idea to latch onto. You asked how 20-somethings would risk their livelihood for something that will probably not make it? it's becasue there's that chance it WILL make it. I;ve been taught to dream big, fall hard, get up, and do it again. money's just money and there are worse things in the world than being poor- like a job that you hate or that turns your brain to mush.
It's interesting to note the number of contests popping up asking for original ideas to solve problems. There was one on facebook.com the other day asking for a creative solution to this one problem in two programming languages plus a resume, and the 'grand prize' was a job at facebook. There was another through the University of Texas that was asking for social innovators to enter their plans for a company and possibly win $50,000 to start it up, basically turning the University into a venture capital firm for the moment. People are realizing the benefits of the competition that's going on in Silicon Valley and are beginning to expand that along the University circuits in the US. i personally think that it's great, and am keeping my eyes open for something interesting to do.
As for Silicon Valley itself, it's becoming more of an idea than an actual place for a lot of technology students who are looking to start up. I don't plan on moving out there for anything more lengthy than an internship.

  • 18.
  • At 07:46 PM on 07 Mar 2007,
  • wrote:

I agree with Tom Douglas. I am a physics student and I am shocked on how badly the ΒιΆΉΤΌΕΔ handles its science reporting. Maybe it reflects the current state of Britain's science education?

  • 19.
  • At 08:01 PM on 07 Mar 2007,
  • Laura Herald wrote:

science? try waiting til something decent on the arts (not tv or film) gets a mention

  • 20.
  • At 08:25 PM on 07 Mar 2007,
  • Changcho wrote:

I've been reading these posts with interest. Several go along the lines of "...when I was in Silicone Valley (SV) in the dot-com era..." followed by "Americans have this positive attitude that makes the SV possible" or something along these lines. As someone who has lived most of my life here in SV but has traveled quite a lot (US and abroad), it is my observation that it is not all Americans who have this "attitude" that makes Silicone Valley posible. Indeed, it is the attitude of "Silicone-Valley-inhabitants" who make Silicone Valley possible. Don't forget that Berkeley, Stanford, San Jose State and several other universities are located close to or within SV. Another factor is the huge diversity of ethnicities, and ideas here. And very important, SV is located in Northern California. All these things are important factors.

  • 21.
  • At 08:28 PM on 07 Mar 2007,
  • K Greene wrote:

The average American millionaire fails at seven different business attempts before he finds the line of work that makes him rich. With that it mind, it's a bit easier to stomach the ups and downs of one's business "failures."

  • 22.
  • At 08:37 PM on 07 Mar 2007,
  • Chetan wrote:

Some of the discussions in this years TEDTalk throw some light on the issue mentioned in posts above,

Please check following links,

Burt Rutan -

Ken Robinson -

  • 23.
  • At 08:43 PM on 07 Mar 2007,
  • Michael wrote:

I worked in Silicon Valley during the dot com boom between 1996 and 2001. For an engineer, companies really consider the fact that you have gained hardware or software design experience more important than whether the product sold and the company took off or not. Everyone I met had stories about the state-of the-art projects they worked on, failed to make it simply because of a rival system that was being developed at the same time or simply because it was announced at the wrong time (the market wasn't ready or missing an important release date such as the Christmas buying season).

  • 24.
  • At 08:48 PM on 07 Mar 2007,
  • Valleyness wrote:

I think there's an anything goes, wildness (in the business sense) to Silicon Valley that's difficult to find in other places. Unlike the East Coast, where buildings can stand for centuries and there's history of monied families, the West is somewhat conditioned to impermanence - earthquakes and the "millionaires one day, paupers the next" idea probably adds to this mix. For example, it surprised me after Katrina that people would even question rebuilding New Orleans. If the Big One hit (inside joke: oh, in 30 years or so), I'm pretty sure people would just shake their heads and start rebuilding the Bay Area all over again.

There's also a certain acceptance that everyone is "young" or at least "young at heart" -- and maybe that's a California thing more than anything else. The fact that there are a number of universities in a climate where diversity is welcomed and considered cool helps (not to say that discrimination doesn't exist, but after living in different places I have to say there is a lot less of it than in other areas of the US).

For all the craziness of the Valley, though, its ills, good and mochalatteSanta880Palo680wineryVCness, I really, really miss it. I can't wait to go back home.

  • 25.
  • At 11:45 PM on 07 Mar 2007,
  • Erick wrote:

As an American Entrepreneur who has lived around the valley and in Texas as well as the east coast. I think Britons should look at the venture communities in Tysons Corner (outside of D.C.) and the Research Triangle in North Carolina as a model. The reason being is that Silicon Valley has always had a venture culture ever since the days of the Gold rush. However, N. Virginia and the Carolinas had to build venture communities from the ground up....and what I'm calling a community is one in which someone can take an unproven idea and find the people and organizations willing to give the advice, and/or seed money needed to develop the idea and create a business plan, or even join you as a co-founder in a venture. Before a group of Tysons Corner business people got together to back new ideas, if you had an idea for a new business that didn't involve being a merchant or traditional manufacturing, you were just a dreamer who needed to get a real job.

  • 26.
  • At 12:44 AM on 08 Mar 2007,
  • Robin wrote:

I have been working on starting my own (non-competing) project in the background whist working at least sixty hours per week for my employer, who, it seems is under the impression that they own every idea and line of code I write in the remaining few hours of my own time.

To add insult to injury, my employer started her company up while employed elsewhere.

These kind of restrictions can't be helping innovation and entrepreneurialism in the UK.

  • 27.
  • At 04:18 AM on 08 Mar 2007,
  • Chris wrote:

Interesting discussion; I am a Brit who moved to the East coast USA in 2001 and now I live in San Jose downtown and work for a engineering company.
After living in the USA for 6 years I am still understanding the complexities and small differences that make Americans different from Brits. One is risk, Brits don't like taking risk; remember that guy from the UK that saved up all his money and put it on the roulette wheel? I bet there is one guy a week who does that in the US and they don't make headline news like that guy did in England. Pushing the envelope in technology and business requires risk; alas I fear Britain will become a nation of playing it safe shop keepers....sigh...

  • 28.
  • At 08:44 AM on 08 Mar 2007,
  • wrote:

Having worked for a sucesful US Internet start-up that went public I have seen first hand how the US think big and work hard to become sucessful. They really believe everything is possible and see the world as a small place dominated by the US economy. This mentality helps them as opposed to UK businesses that see the world as a big place and the US an impossible market to break into. The mentality and economics of the companies birth place are the key to this debate.

  • 29.
  • At 08:49 AM on 08 Mar 2007,
  • wrote:

Having worked for a sucesful US Internet start-up that went public I have seen first hand how the US think big and work hard to become sucessful. They really believe everything is possible and see the world as a small place dominated by the US economy. This mentality helps them as opposed to UK businesses that see the world as a big place and the US an impossible market to break into. The mentality and economics of the companies birth place are the key to this debate.

  • 30.
  • At 09:36 AM on 08 Mar 2007,
  • wrote:

I co-founded a social networking dot com last year which didn't work out in its original form for a multitude of reasons. But far from being disheartened by this experience, I'm involved in starting a second dot com. The fear of failure, especialy second time around, does focus one's mind somewhat and acts as a powerful motivator to make things happen. But I'm not sure I agree with some of the comments about Britain's attitude to success or failure. I've found people to be incredibly supportive and interested in what I am trying to achieve through these start-ups. I think there's a sneaking admiration these days for individuals who are prepared to go for it - particularly in the world of dot com.

High profile success stories like MySpace and YouTube plus the emergence of reality entrepreneurial TV such as Dragons Den have whetted the public's appetite toward entrepreneurs. As a result, I believe there is less stigma attached to failure and, of course, even less to success. And that's what we all hope to achieve.

  • 31.
  • At 10:20 AM on 08 Mar 2007,
  • wrote:

Having worked for a sucesful US Internet start-up that went public I have seen first hand how the US think big and work hard to become sucessful. They really believe everything is possible and see the world as a small place dominated by the US economy. This mentality helps them as opposed to UK businesses that see the world as a big place and the US an impossible market to break into. The mentality and economics of the companies birth place are the key to this debate.

  • 32.
  • At 10:56 AM on 08 Mar 2007,
  • David wrote:

Those that succeed are those that learn from their mistakes and get on with it, whatever their 'it' is.

SV has all the right ingredients to make be a success in much the same way that a business needs to have the right mix to become sucessful.

Starting and running a business in Britain is problematic as it doesn't have the right compost mix in which to grow and nuture business, at least not in the technological field. Those that do make it however, tend to be world class and promptly bought out by US enterprise.

  • 33.
  • At 12:34 PM on 08 Mar 2007,
  • Michael Grazebrook wrote:

High tech entrepreneurship works here too. It's been much of my career - Dad's business: Videotronic early TV games, my first employer: ES2, making chips using a novel process. My first client, InCA, which sold out a couple of years later making several million. My own business, a UK/Moscow consultancy from 1990-2, started when I was 25 .... I had lots of support. I think people just need the courage to believe they can.

  • 34.
  • At 02:04 PM on 08 Mar 2007,
  • Roy Gregory wrote:

Britain is very good at starting service industries and very poor at starting manufacturing industries.

Taxation and red tape are probably the reason for this.

But if you started a new business manufacturing a new skin cream or food product, or similar, then as soon as you showed any success you would be strangled by the big supermarket chains. Even a patent may not help unless you have very deep pockets. So 'unfair' competition is another worry.

  • 35.
  • At 02:10 PM on 08 Mar 2007,
  • Katie wrote:

I think the British attitude to funding is the crunch thing. There's still an air of "we'll lend you money when you've already made loads and there's no risk".

The US seems to have a far bigger pool of people who are willing to take the "high-risk, high-reward" strategy of investing in other people's ideas.

They think that a business happens when someone with money meets someone with an idea.

British institutions don't see ideas as part of a business.

If you go to raise funding and you take only an idea, no matter how well developed, they'll give you funding to match the no funding you currently have.

The work put into the idea to develop it has no value for them -- the only question you get asked is "how much money are YOU investing?" and they'll maybe consider matching that at best.

They seem to think that a business starts when two people who already have money get together.

Without access to the funding, the ideas aren't going anywhere except abroad.

  • 36.
  • At 02:28 PM on 08 Mar 2007,
  • Roy Gregory wrote:

Britain is very good at starting service industries and very poor at starting manufacturing industries.

Taxation and red tape are probably the reason for this.

But if you started a new business manufacturing a new skin cream or food product, or similar, then as soon as you showed any success you would be strangled by the big supermarket chains. Even a patent may not help unless you have very deep pockets. So 'unfair' competition is another worry.

  • 37.
  • At 02:46 PM on 08 Mar 2007,
  • Andy wrote:

Ive set up several small electronics businesses, however the biggest hinderance was not a stigma of failure.
The biggest by far problem is that in the UK we treat small companies as if they are inferior and petty. You can be very successful and achieve amazing things with your small company, but every time you come across needing to do business with a larger company you will meet people who feel superior and look down on you. They feel they are more important (regardless of their experience) because of the large company they work for, and are contemptuous of smaller operations.
When Ive been touting for business in Silicon Valley many of the largest companies were extremely interested and enthusiastic about my products, and complimentry about what we had achieved.
So, lets give a bit more respect to the small company guys who keep their businesses running despite these predudices.

  • 38.
  • At 02:50 PM on 08 Mar 2007,
  • Andy wrote:

I would say the "failure" stigma is nto just an issue with you're own business venture, but any career. To get on in any company in the UK you have to keep on topping the last position you were in. If you take a job that doesnt work out you are scarred for years, people think there is something wrong with you if you decided a particular route is not for you. So its indemic in the way we think in this country, we push the need to be tenacious as a quality, but we dont allow someone to get things wrong and try again. Hmmm now this might be the reason why senior management tends to be populated by people who avoid committing to anything. 10 successes, but have one failure and see how many of your colleages are still friends!

  • 39.
  • At 03:12 PM on 08 Mar 2007,
  • Geoffrey Roberts wrote:

America has a history of throwing money at companies / business ideas that simply can't make a proper profit. That led to the initital dot-com boom and bust, and may well lead to another.

Obviously a handful of companies survive. Most of the big 'net companies are American or American-based because the net started there, there's lot of tech students there, and there's lots of money there (plus they sort of speak English).

  • 40.
  • At 03:41 PM on 08 Mar 2007,
  • Chris Thompson wrote:

I agree with most of the comments that the US responds to failure with almost as much respect as success, however, I feel that the UK (and Europe in general) has a much higher degree of standards and methodologies to avoid failure in the first place. I have lived and run my business in Minneapolis since I was 22, now 27 starting life in Cheshire, England. I have found my background in these skills to be a significant step towards building a successful business, rather that the throwing vast amount of energy and resources on the whim that success or failure are both acceptable results for an outcome.

  • 41.
  • At 04:47 PM on 08 Mar 2007,
  • wrote:

I moved to England about 1o years ago as a Systems Engineer for a US software vendor. 4 years later, the company was bought out, and I started my own consulting company.

Repeatedly, over the past 6 years, I have come across Brits in my industry (software consulting) that give huge amounts of their contract rates to umbrella companies rather than start their own businesses. The reason? To avoid 'failing' in a business of their own.

After all this time, I still wonder about a country where every effort must succeed, or else you are looked down upon. And, to make matters worse, looked down upon by people who will never even begin to see the amount of money even a 'failing' business will generate.

  • 42.
  • At 04:53 PM on 08 Mar 2007,
  • Scott wrote:

I'm an American who's traveled and lived extensively in Britain. How people perceive failure and British (and Western European) risk-adversity both contribute to lack of entrepreneurship.

Another important factor is perspectives on work. Several people have talked about Americans working long hours. American entrepreneurship is a lifestyle, not a job. The same applies to other types of creative work like art and science. It's not really work when it's how you would choose to fill free time anyway.

  • 43.
  • At 05:21 PM on 08 Mar 2007,
  • Dominic Beesley wrote:

Don't let it be forgotten that silicon valley has grown up not very far away from some of the most heavily subsidised military businesses in the world.

This doesn't take away many of the good points mad above. But does explain where a lot of the money for profilgate spending originates.

Britain suffers heavily from the fact that we take the free market to absurd extremes when it comes to not protecting out national interests.

Often preferring to save money buying out of date technology in from abroad rather than risking large amounts of money on high-tech projects.

Our system of government seems to lack the bottle and want guaranteed returns on risky investments and panics if all does not go to plan: Advanced Passenger Trains, Hovercraft, UK Space programme, Concorde, Eurofighter, etc all ruined for penny pinching at the start and panicing at end!

  • 44.
  • At 05:52 PM on 08 Mar 2007,
  • GaryB wrote:

You must realize that silicon valley types are fairly self-selected – a large proportion came here to work on technologies that they are passionate about. A much smaller portion of those are entrepreneurial – willing to take risks, able to network well. There is a large social network between VCs, academics, engineers and business people. When the combination is right, a business with potential is created. Even in Silicon valley, there are many people who are very risk adverse (and in the US, you get no assurances of medical coverage to make it even scarier). Nevertheless, for those of us who are financially prudent, we can and do take risks. I left a fairly senior research position at a very successful large company just 6 months ago to help build a startup. I did it because I wanted a little adventure, the old job was fun but was getting stale. I’m almost 50 years old but just trust that I have enough creative capacity AND enough contacts to land on my feet somewhere else should the new company fail. Trusting yourself as an individual first is a deep theme in Western US history and culture. That helps, but I see the same thing in many immigrants who pulled up all their roots and risked all to move out here. Like I say, part of Silicon Valley culture is just such a self-selection. It’s a unique place, but a tad one sided. Expensive, very fast paced and not for everyone. There are other things in life, just not in MY life. In any case, I do love London and grew up on Irish folk songs and British comedy, so influence goes both ways.

  • 45.
  • At 06:04 PM on 08 Mar 2007,
  • wrote:

Only a couple of weeks ago, a student at MIT displayed his new device to climb tall buildings and scale walls in seconds; a very useful device for soldiers and fire fighters and builders- investors were lining up to market and manufacture the device. The same MIT also gave Woody Norris a grant to develop further his air scooter. The case in point- let me just add that this risk taking attitude is not just limited to Silicon Valley. You find it on the East Coast too- Cambridge with MIT and Harvard have turned it into a Biotech hub. Some body already mentioned the Research Triangle Park in North Carolina. You also have the finance hub in NY and Boston. Its really more to do with the attitude of the people living right now in USA and those before who created this atmosphere of go-for-it attitude.

  • 46.
  • At 08:26 PM on 08 Mar 2007,
  • changhco wrote:

Oh, one other important item I wanted to add to comment #20. The huge number of Venture Capitalists (VCs) around here is also a big factor.

With respect to item #43: which military business does Mr. Beesly refer to? Perhaps he is thinking of those in Southern California? I don't think that is a big factor for the Silicone Valley, IMHO.

  • 47.
  • At 10:21 AM on 09 Mar 2007,
  • wrote:

The lack of money - The knock-backs I have suffered from banks / other sources have terminally damaged at-least 2 projects I was working on including a medical software package way back in 1998 before Connecting for Health was even a gleam in anyone's eyes.

The lack of support - The rush to buy safe from multinationals, most of which do not have an understanding of the products anyway.

Given these limitations,, having lost a substantial sum of money & lacking the freedom to move to the USA, I have folded my ambitions & stick to consulting for others.

  • 48.
  • At 11:03 AM on 09 Mar 2007,
  • Tim Bax wrote:

What do they say in America? You're not serious about business until you've had a couple go down under you.
In Britain we're just not serious about business, full stop.

  • 49.
  • At 12:28 PM on 09 Mar 2007,
  • wrote:

What do they say in America? Be emotional about your business, and business-like about your emotions! In Britain you are thought a nutcase if you are passionate about your business.

  • 50.
  • At 04:28 PM on 09 Mar 2007,
  • Matt Larson wrote:

Institutions in the UK and EU are designed not to fail - or replaced. The creation of national champions or consolidated service providers reduces the pressure to innovate on industry firms. The stable business to business market created by this lack of innovation pressure limits the opportuities for start-ups by lowering demand for new products and making long term relationship sales a key determinant of profitability. Lending to start-ups in this environment is a risky proposition. Until EU firms are living under the mandate "innovate or die" the demand for start-ups will be limited.

  • 51.
  • At 06:15 PM on 09 Mar 2007,
  • JohnM wrote:

The original question should have been two questions: what attracted the large pool of talent in the SV in the first place, and how does it perpetuate. A partial answer to the second question is that there is a community of talent here that knows each other. Most of the R&D engineers and marketing folks simply 'play musical chairs,' going back and forth between big companies and start-ups. There is a cycle whereby groups of these engineers who know each other from working at other companies in the past informally rank each other and commiserate to leave the big companies to join start ups together. The cycle is that the engineers create a start up with the goal of getting a product solid enough to eventually attract one of the handfull of big companies to buy them up. Then they break off from the big company and start up again. They keep doing this until they are rich or bored. In sum, my point is that the engineers in this pool keep trying until they find the right combination of people to get it right.
It's analogous to rock n' roll musicians trying different combinations of band mates until they find the right ones to be the Beatles.

  • 52.
  • At 07:43 PM on 09 Mar 2007,
  • Mike S wrote:

I think that the culture in CA (Raised in L.A. and spent the next 25 years in the Bay Area) goes way back. Risk takers came here and stayed, creating the risk-taking culture that allows bankruptcies without recrimination and a chance to start clean again in 7 years.

That willingness to let people recreate themselves is seen in the epithet on my favorite headstone from the 1860s (in a California gold country cemetery) best explains the attitude:

"Here lies John Smith. At least that's who he told us he was, we chose to believe him"

  • 53.
  • At 07:56 PM on 09 Mar 2007,
  • wrote:

There are some real cultural issues behind the start-up mentality of the Valley and the 'fear of failure' mentality in the UK. One thing I always notice in England is the business sections of any bookstore--they are tiny, and rarely have any inspirational or 'true story' type works about those who have succeeded. In the US you can go into any business section and find the biographies of Gates, Ballmer, Jobs, Ellison, along with narratives about 'the early days' of Google, Ebay, Amazon. Well Bill Gates goes to India, they sleep out overnight to get in and hear his speeches. When he comes to the UK, I wonder if anyone even notices?

There simply aren't a lot of role models in the tech industry in the UK, despite having quite a bit of talent.

  • 54.
  • At 08:22 PM on 09 Mar 2007,
  • bvs wrote:

I have been involved in four startups and now am trying to start a fifth one. Two of them were not in the Silicon Valley so I have had a chance to compare it with other parts of the US.

I think it is the optimism, a can do attitude, not willing to take a no for an answer, hard work, mix of different cultures, respect for creative, smart, skillful people, networking, concentration of a lot of very good people in a lot of different fields (engineers, programmers, mathematicians, marketeers, salespeople, physicists, VCs, PR people, CPAs, lawyers etc. etc.), nearby schools such as tanford, UCB, SJ State Uni that supply fresh blood, failure not being a stigma, etc that makes the difference. It is not that other places don't have these things, but here this is all taken for granted. Even here are a lot of risk averse people but if you are willing to take a huge risk on something untried, people do not think you are crazy; in fact some of them will try to figure out how they can be a part of it! In a way the Valley has a ecology much like a tropical rain forest -- lots of competition, lots of species, and new ones pop up all the time. And when a company dies, most of its people resources get reused right away!

I see a similar energy in places like Pune & Bangalore -- in fact more like what it used be during the internet bubble era in the Silicon Valley. So it is possible to create the right kind of environment. But only time will tell if they will continue to be as active for as long. The Valley has been innovative in many different areas for the past 40 to 50 years and I am sure they will continue to ride new waves.

  • 55.
  • At 10:53 PM on 09 Mar 2007,
  • Mark Voelker wrote:

The Industrial Revolution started in England over 200 years ago (in Severn valley, perhaps?).

I wonder if the culture that created that burst of innovation has changed or moved away - perhaps it is now resident in Silicon Valley.

  • 56.
  • At 11:13 PM on 09 Mar 2007,
  • Judith wrote:

I asked my son just yesterday why he likes living here in Silicon Valley. He replied, "Friends. And there are smart people here - people I can hire eventually." He is, of course, doing his first start-up.
And I agree - we never found the atmosphere in Seattle so conducive to creativity, nor did we find people as invested in the life of the mind. I feel like my IQ went up 20 points just moving here.

  • 57.
  • At 12:16 AM on 10 Mar 2007,
  • Ken Boetzer wrote:

Good afternoon,

I was working in the psychology field in Arizona, but was always an engineer on the inside. My soon to be ex mother-in-law, after reading several articles, told me she thought I'd fit in real well in the silicon valley. Not too long after the deed happened and I was free to go and do as I pleased, I found out she was right. That was over 30 years ago. I have enjoyed my tenure in the "Valley of the Silly Con" for over 30 years and it still feels like being on a sports team. I got my primary training at Hewlett Packard, and went from there to the start-up curcuit. It's a kick and a half!! At age 60 I feel such a rush getting together with young engineers to pound on an aggravating problem. There is no discrimination, other than a dislike of poor performance, in the silicon valley. The company I work for was founded by, and got a lot of funding from, some Indian fellows. Our company founder is a super good guy and I always enjoy his company. I don't know how many more startups I've got left, but I feel like one or two ought to do it. :-)!! For a lot of us it's not the money but the challenge that really gets us going. I have never promoted myself to managment and on top of that I'm a mechanical engineer, a wrenchy in a sparkies world. :-) Still I fit in and have a blast. There are a lot of young people from India at Juniper and a lot of the young guys gather with me and a couple other of the "old guys" to talk about home repair, car maintenance, welding, and other of the manual arts over coffee. I have always taken great pleasure in being a mentor, and in the sillycon valley there are lots of opportunities. I have at Juniper, the pleasure of working with several guys that I have worked with for 20 years or more. Several of us have seen each others kids grow from toddlers to productive adults. It would seem odd to many to have this kind of continuity in such a buzzing place as this, but still, it exists. There are few places where the words "The world is what you make it." are as true as they are here.

  • 58.
  • At 01:13 AM on 10 Mar 2007,
  • ekg wrote:

perhaps it has to do with the "American Dream"

  • 59.
  • At 07:14 PM on 10 Mar 2007,
  • Gordon wrote:

The problem to my mind is two-fold:

1. Britain is well known for producing many inventions and new technologies but simply cannot exploit them. This surely indicates that either:

(a) The corporate culture in Britain is too risk averse - even though maybe the people aren't.

(b) There is too much separation between roles in the UK. The inventor has zero business accumen and the businessmen are useless at lateral thinking.

2. Relating to point (b) above. It is blindingly obvious that in a demented effort to get people educated to degree level, we are over-educating people. Or rather we are training people in useless skills. Unless you have a degree (of whatever vague description) you have failed. Many people are much better off getting an internship, doing a vocational course or *shock horror* set up their own firm. Degrees are great, but the longer you are force-fed information the more robotic you become. Let's have a bit more respect for those fighting their own way, rather than pushing up the Government statistics!

  • 60.
  • At 09:30 AM on 12 Mar 2007,
  • Henry Yates wrote:

The best explanation I have heard on this is by Randy Komisar from
Kleiner Perkins Caufield & Byers. he talks about learning from failure in this excellent video clip...

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