Should Smaller Indiana strive to be like Silicon Valley?

[Pat Coyle]

Nwodkedi Idika only arrived at Smaller Indiana Yesterday, but he immediately caught my attention when he said, "I'm hoping to meet others who want to see the Midwest become more like Silicon Valley."

What do you think of this goal? Should we strive to be like Silicon Valley?

Before you answer this questions, you might want to consider: how did Silicon Valley become the hotbed of technology that it is today? What makes it tick? And how has it sustained itself over time even as other regional technology clusters have tried to emulate its success?

If you need a bit more background / perspective on this topic, here's a good article describing the differences between Silicon Valley and other U.S. technology hotbeds. Excerpt from article: As world markets strive to be the "Silicon Valley of (fill in the blank), the differences even among U.S. geographies has me thinking what makes Silicon Valley so different from other geographies that have the same raw ingredients you'll find in the 57-mile stretch from San Jose to San Francisco.

There is a marked difference between the Valley and Valley wannabes. This difference is the intangible "it" that is as difficult to describe as it is to replicate. The spirit and culture of entrepreneurship thrive in Silicon Valley. It is a culture that eschews stability and certainty. When a business fails, its people scatter to new ventures that are the basis of new possibility and economic growth. (Read whole article here).

If you have an academic interest in this topic, check out a book called "Clusters, Networks and Innovation," by Stefano Breschi and Franco Malerba (Oxford University Press). One interesting side note from that book examines another technology region in Hsinchu-Tapei, Taiwan:

"...the authors argue that a key ingredient to their success has been the contributions given by a community of US-educated engineers who have built social and economic linkages between Silicon Valley and Hsinchu economies. This technical community formed during the 1970's and 80's as US educated Taiwanese engineers started to organize collectively and form professional networks and organizations. The reversal of this "brain drain", spurred by the acccelerated growth of the economy in the 80's, thus brought back to Taiwan an increasing number of returnees with strong professional and personal ties to Silicon Valley. Moreover, a growing population of new "argonauts", constantly travelling between companies with activities in both regions, also contributed to establish and co-ordinate a sustained flow of technical knowledge, skills, contacts, capital, and information about new opportunities and new markets. The development of this transnational technical community has also transformed the relationship between the Silicon Valley and Hsinchu economies from one-way to more decentralized two-way flows of technology, skills, and capital, but highly complementary capabilities."

This section goes on to say that multi-national corporations may no longer be the best way for ideas and innovation to spread globally. Innovation spreads as much through social and professional networks of people working on a local level.

There's no arguing with Silicon Valley's success, but it's harder to pin down the reasons why the region has been able to sustain its competitive advantage in the entrepreneurial, high tech arena. Is it the geography which clusters innovative companies closely together? Is it the social networks that connect workers across company lines? Is it the presence of venture capital? Is the the overall risk-taking mindset that seems to pervade the region? Is it the constant influx of bright minds who migrate there who help sustain the environment of innovation?

Should we immitate the "valley"? Can we immitate the "valley"?

Are we better served to immitate Silicon Valley? Or might we be better served to cooperate with the region as the Taiwanese engineers have done? What if we organized our own team of "argonauts" to live on the Silicon Valley "planet" for a time, and bring back to Indiana the knowledge and networks necessary to participate in the Silicon Valley ecosystem?

Or maybe that's already happening??

[Brad Williams]

I had a chance to visit with my cousin in Palo Alto a couple months ago on my trip to Oakland to see the Raiders vs. Colts game. Some of you may have heard of him recently in the news as the founder of FriendFinder.com who recently sold to Penthouse for $500 million. He actually asked me why everyone feels they have to move to Silicon Valley to get a technology company off the ground?

He brought up a couple great points. The beauty of most technology companies is location. It doesn't matter if you're located in Palo Alto, California or Boring, Oregon (real city) because your users are all over the world.

Networking is the largest part of the draw to Palo Alto for most. Of course the local mindset is as technology focused as it gets. You can't find a restaurant/bar/coffee house without free wireless internet.

He said as long as you were determined to succeed and had someone to bounce ideas off of anything was possible, regardless of location. I'm starting to believe him since he's an internet billionaire now.

[Thomas Ho]

I can attest to the Taiwan experience because I saw it begin to take shape when I was visiting Taiwan in the late 1980's in preparation for doing a Fulbright there which (unfortunately) did NOT happen. As a fan of Taiwan-based HTC cell phones, I have had first-hand (positive) experience with the success of this Taiwan-Silicon Valley connection.

I echo Brad Williams' comments as one can see from my Facebook friends list as well as my Twitter friends. With the use of Web 2.0 services, I feel very "plugged in" withOUT having to deal with Silicon Valley's traffic and cost of living!

[Chris Lucas]

After working in and around the Bay area and Silicon Valley, I think one important factor in its development is Stanford University. Google and many other companies were started by students of Stanford or by research done there. I also think the available VC $$ is very big, Sand Hill Rd is to VC as Wall St is to institutional investors.

I don't think we should try to recreate the Valley here. We can certainly learn from SV and try to create a similar "spirit" but we need to find our own culture, develop the best and brightest and highlight what great things companies are doing here. @brad has a great point, the beauty of today's technology is that we can create tech companies anywhere, you just have to make good companies and eventually people will start to notice your city/region.

[Nwokedi C. Idika]

I think we have to do more than make good companies--just like you have to do more than just make a good product. We have to "glamorize" it. Let's face it, young energetic people are drawn to excitement. And the promise of riches if you go to SV is a sexy proposition to a young person.

[Chris Lucas]

Yes you do have to "glamorize" it but you also have to have more than Scott Jones to hang your hat on. You have to have a a stable of solid companies to build up a presence and gain notoriety. SV started with giants like HP leading and breeding innovation in and around the area and allowing, along with a strong University presence, to create a philosophy and community of innovation. I think there are some good things going on in Indiana and we have to publicize them, but I also think that the majority of the business people outside of Indiana will still see us as a manufacturing state until we build up a few very solid companies.

[Nwokedi C. Idika]

I agree totally Chris. I've tried to do my part. Recently at Purdue in conjunction with a instructor of Entr, I tried to put on a state-of-the-art course at Purdue: http://cs490e.wiki.zoho.com/, people from Stanford area and California were looking at this course (says google analytics). We would've beat Stanford to the punch if this course took off. I pitched the CS department head, and he was with it until it was time to execute. You'll see just a fraction of the interest from students at the bottom of that url in the comments section. We had people from almost every discipline wanting to take the course.

Can you imagine what would've happened if just one of the startups out that class got to 1/1000 the size of a Google??? It would've changed the complexion of the West Lafayette area FOREVER.

[Chris Lucas]

That is exactly what Purdue and other schools need to do, congrats on your efforts! It is unfortunate that the class didn't take off. I think that a coordinated effort from Universities and City/State government could help raise money/interest/profile etc of these types of efforts and could make them successful.

[Thomas Ho]

I could help you to find a "home" for this course at IUPUI in Computer and Information Technology. I can get the folks at companies such as Angel Learning, DyKnow, and BehNeem to participate with programming projects.

[Kyle Lacy]

I completely agree with you Nwokedi. My generation loves the thrill of the benjamins (or 1 million benjamins).

[Lorraine Ball]

Martin Jeske, the former president of Purdue ( originally from Standford) agreed with the idea that a strong university, well intetgrated with the local business community was a critcal part of building that Silcon valley culutre.

Today there is a marked difference int the university communities. In Lafayette, at Jeske's urging, the students, professors, government and biz pros around Purdue interact frequently, share projects, and efforts to start, build and attract new business and ideas to the community. In Bloomington, there is often a perception of "walls" between the communities.

One role Smaller Indiana can play is a platform for ongoing exchange between these communities.

[Thomas Ho]

It's Jischke, NOT Jeske.

[Jack Pincus]

I agree. How do we attract these groups to Smaller Indiana and get the dialog started?