A View from Mark Zawacki

Why the “Next Silicon Valley” Doesn’t Really Exist

Lots of people want to create another innovation hub like Silicon Valley. Here’s why they’ll all fail.

  • November 8, 2013

It’s understandable that so many places around the world want to re-create the economic engine of Silicon Valley, as MIT Technology Review wrote about in its recent business report (“The Next Silicon Valley”). But creating another Silicon Valley will be far harder than anyone imagines. That’s because the Silicon Valley ecosystem is now far more sophisticated than just startups. 

For one thing, it has a critical mass of serial acquirers, starting with Oracle, Cisco, HP, Intel, and Symantec, and joined in the past decade by companies like Google, Salesforce.com, Facebook, and LinkedIn. There is a sizable cluster of Silicon Valley companies with the balance sheets and foresight to make very large acquisitions.  

Second, these companies are used to disrupting things. Apple and Google have disrupted the mobile industry, Google and Facebook have disrupted the advertising industry. Apple has disrupted the music industry.  Square, Netflix, Airbnb, Uber, and dozens of others are beginning to siphon off billions of dollars in other industries.

And finally, there is the trifecta of large, global, and weird:

Silicon Valley has 400,000 workers broadly in the tech sector. If you count the supporting infrastructure of service providers, it might be twice that size.

That workforce is global. Almost two-thirds of people working in Silicon Valley are “foreign workers.” People migrate to the Valley from all over the world. They bring a very diverse set of experiences on how industries in different countries work.

And it’s weird. Some argue that Silicon Valley perhaps has higher rates of people with Asperger’s, people on the Autism spectrum disorder, and people with dyslexia, and that this in fact contributes to its enduring success.

I admire and respect startup communities globally, and I’ve worked with many of them. They should keep doing what they’re doing. There is plenty of room to build new businesses—and if it’s a very high-growth disruptor and strategic, odds are a Silicon Valley company will buy it. There are now simply too many industry ecosystems in the Valley to let big opportunities like that pass them by.

Mark Zawacki is the founder of 650 Labs, a Silicon Valley-based consulting firm.

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