Summary: There will NEVER be a “Next Silicon Valley”. Geography is becoming irrelevant for startups because best practices are available online, capital flows freely to talent, and Silicon Valley will come to you.
About every two weeks I get asked by someone – sometimes journalists who never been to China – about whether “Beijing is the Next Silicon Valley”.1
In these discussions I try to convey 2 points:
- China is so different from the West that it might as well be a different planet – simplistic comparisons don’t work. 我是老外，我不明白。2
- There will never be another Silicon Valley because geography is becoming irrelevant for startups.
Silicon Valley 10 Years Ago: Be There or Get Killed by Those Who Are
In 1994 I walked onto Stanford’s Campus and for the first time in my life I felt truly at home. I had no idea there was such an amazing place where people EMBRACED change and actively tried to drive it; where engineering talent was revered and not treated like a Dilbert charter.
Since then I’ve taken every opportunity to go back to Silicon Valley and spend time with friends and startups there – knowing that it was a matter of time before I moved back there and made it my permanent home.
In fact for most of my career I had to go to Silicon Valley to know what was going on. I had to go to the parties, conferences and meetings to understand the latest best practices, what investors were funding, and what startup ideas were failing. It was truly unique – the only place with a sufficient concentration of capital and talent. Most entrepreneurs and investors accepted the reality that they needed to join the Silicon Valley ecosystem or get crushed by it.
The whole world is envious of the region and for 20 years I’ve been reading about “The Next Silicon Valley is … “. It hasn’t happened in 20 years.
It will NEVER happen – EVER.
The World Started Changing in 2009
Silicon Valley is becoming a state of mind – not a place. As a startup ecosystem “the Valley” – i.e. the physical location between San Francisco and San Jose – has its own pros and cons.
I still love going there and get tingles when I arrive in SFO, but every year the region becomes less and less unique. It isn’t happening because it is being replaced by “The Next Silicon Valley” – it is happening because geography is becoming irrelevant.
Why the Era of Silicon Valley is Ending
The era of Silicon Valley is ending because:
- Information previously only available there is now available everywhere
- Capital and talent is fluid
- The best minds in Silicon Valley will come to you
Reason 1 – Startup Information is Available Online
If you’ve been involved in the startup community for less than 5 years it is probably hard to image a world without Twitter, Meetups, Lean Startup, and VC/Entrepreneur blogs, but until recently this was the case. I remember pouring over every word of Bill Gurley’s Above the Crowd blog in 1999.
Today? If you cannot figure out what is going on you’re simply not trying. The best practices of the startup community are widely available to anyone who puts in the effort to learn.
Reason 2 – Silicon Valley will Come to You
Steve Blank travels the world and launched NEXT – now any startup community in the world can take the best practices from his Stanford and Berkeley classes and teach them to entrepreneurs. Visit ANY startup community in the world and you’ll hear stories about Dave McClure. Dave is building a global brand for 500 Startups and is willing to travel anywhere to do it.
And if you want to learn how to apply best Lean Startup practices you don’t have to visit San Francisco – you can attend a Lean Startup Machine event in a city near you. I’m guilty too – when I first arrived in Beijing 18 months ago almost nobody was talking about Lean Startup. I started evangelizing it and have become known across Asia as a result.
Reason 3 – Capital is fluid
I remember friends lamenting that Silicon Valley VCs “are so obsessed with Silicon Valley they won’t drive over the Dumbarton bridge.” Top-tier Sand Hill Road VCs held all of the power and startups had to go to them. Today? Investing is highly, highly competitive. VCs, Angels, and Accelerators are constantly marketing themselves to the world to get the best dealflow and build their brands.
Startups pursue talent – and capital pursues startups. The competition is getting so fierce that “where” is becoming irrelevant.
What Matters is the Trend – NOT the Status
Friends in Silicon Valley correctly point out to me that the region still holds many big advantages over the rest of the world. While this is true, it is far, far less important than it was 10 years ago.
If you’re part of a startup community outside of Silicon Valley I would encourage you to stop trying to imitate it. Stop calling yourself Silicon “Blah” 3 and instead capitalize on the actual, long-term trend of the democratization of entrepreneurship.
If you’re a journalist with the assignment of writing about “Why X is the Next Silicon Valley”, consider writing about what is actually happening instead of what everyone is speculating about.
It is the only story that matters and a lot easier to write about than China.
About the Photo
A few weeks ago Rui Ma of 500Startups organized a Beijing Angel investor dinner with investors from Europe, America, and Asia. In addition to some great Chinese cuisine and too much beer, we also had a great chat about the real trends we are all seeing in startup communities around the world.
It was the kind of conversation you could only have in Silicon Valley 10 years ago. The dinner was a great metaphor for the democratization of entrepreneurship worldwide.
- A notable exception is Elmira Bayrasli who is writing a book called Steve Jobs lives in Pakistan. We met at local Angel investor dinner in Beijing and I was really impressed with her work and perspective. ↩
- I’m a foreigner, I don’t understand. ↩
- Please stop calling your region Silicon “Blah” – especially Silicon Prairie. In addition to being just bad branding, you’re competing with multiple regions for a bad name. The rest of the world doesn’t know what you’re talking about or who you are. ↩