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Is Silicon Valley really a hot bed of startups? Let's see: People do 'startups' border to border in the US, in communities tiny to huge. Those startups might be a pizza carryout, electrical engineering company, franchised fast food restaurant, white tablecloth restaurant, law firm, CPA tax firm, auto body shop, photo studio, boutique dress shop, Web site design and programming firm, big truck/little truck product supplier, etc. Yes, Silicon Valley has a high concentration per capita of venture funded information technology startups, but there are startups all over the US. Do the venture funded information technology startups really need a very special environment to keep going? Let's see: An auto body shop, white table cloth restaurant, or even a lawn mowing service need more expensive capital equipment than an information technology startup. E.g., just a lawn mower can cost $13,000, enough to buy parts enough to plug together 10 good servers. A Web design firm anywhere in the US, or the world, has nearly all the same software challenges as a venture funded social Web site in Silicon Valley. Does Silicon Valley really have a big advantage on the best creative work? Let's see: Let's look at some of the best creative work in, say, music: How did Stradivari and Guarnieri build their violins, Vivaldi, Bach, Mozart, Beethoven, Mendelssohn, and Paganini write for violin, Heifetz get started in violin all in really small communities where what they were doing was astoundingly rare and world class on an historic level? I mean, who the heck was Mozart going to go to for help on how to write interesting, novel harmony? Where was Bach going to learn about key modulations? Who gave Mozart the crucial help he needed to write his operas or Bach to write his organ pieces or his violin 'Chaconne'? No one. Who helped Newton with optics, calculus, the law of gravity, and the second law of motion? Who helped Watt with the steam engine? The history of the best works in art, science, engineering, and technology is awash in people doing historic world class work in what in Silicon Valley would look like near total isolation. So, (1) startups happen all over the US and (2) much of the best work in all of history happened in near isolation. So, Silicon Valley is not needed for either startups or good work. There's another candidate reason for the high per capita concentration of venture funded information technology startups in Silicon Valley: On average and in nearly all cases, the venture partners have at best meager qualifications in anything technical yet have to justify their risky investments to their general partners and limited partners. Their best justification is, may I have the envelope please? Thank you. Here is it: "Join the herd!" So, get a place on Sand Hill Road or nearby and do much like everyone else does. So, 'fit in'. Talk to each other a lot like gossip among middle school girls. So, net, what Silicon Valley has a high concentration of is not really startups but just venture funded information technology startups, and the reason is not that Silicon Valley is an especially good place for the entrepreneurs to get the work done but just that the venture funding is concentrated there because the venture partners do not have the qualifications to evaluate projects on their own and, instead, get along by fitting in and joining the herd. Net, the concentration is due to the propensity of venture partners to form herds. Once again I'm glad for US national security that the Silicon Valley venture partners are not DARPA, NSF, or NIH problem sponsors. |