When Secrets of Silicon Valley, from Deborah Perry Piscione, first came out, I put in on my Amazon wish list. However, as I started tracking the reviews, I saw some on the average side. I decided to get it at the library instead and I'm glad that I did. It's an interesting book but I don't see myself going back to it. That being said, I wanted to share a few nuggets that stood out.
Ms. Piscione relocated to Silicon Valley from the DC area in 2006. Therefore, her insight reflects both an objective outsider's view but also the view of someone who has started several companies in Silicon Valley on her own. She identified the following areas as the key ingredients for why there is so much innovation:
- The importance of Stanford University - both on its founding philosophy and on its continued focus on innovation, incubation & business partnerships.
- The people and the culture. This includes the natives as well as the many innovators - especially south Asians - attracted to the area. Over 50% of Silicon Valley start-ups are led by immigrants.
- The cycle of innovation. There is a constant flow of new companies doing groundbreaking technology work. However, what really seems to be part of the juice in the Valley are the big successes - you hear so many references to Google, Apple, HP and Intel. There are also smaller but equally innovative companies such as Tesla and IDEO. But the thought of creating the next Apple drives a lot of energy.
- The acceptance of failure as a badge of honor. Failure in business is frowned upon in many cultures. In Silicon Valley it is almost expected that you're going to fail, probably multiple times, before you have success.
- The business model philosophy. The author argues that when start-ups are seeking funding in other markets, the question is "how will you generate revenue?" In Silicon Valley, the question instead is asked "how will you create value?" Of course, the venture capitalists want a great return on their investment - that is, value leads to revenue. But you can see in companies such as Instagram, YouTube and Facebook, that value came well before revenue and these companies were well-rewarded for their established value.
- The sophistication of the venture capitalists - especially those on Sand Hill Road.
- The services infrastructure: having a network of law firms, banks, accounting firms, investment banks, consultants, incubators and headhunters that have structured themselves to support a fast-faced, very dynamic business ecosystem.
- The informality. In reading Steve Jobs biography, I was fascinated to learn how frequently he would be seen taking walks around his neighborhood, often with other well-known entrepreneurs & technologies. "Secrets" explains that this is just part of the fabric of Silicon Valley. It is an informal culture where even the most successful people are friendly and willing to share. The Valley's well-known meeting places, where many successful ventures have been launched, and lifestyle all contribute to the fabric of innovation.
Ms. Piscione references various interesting insights on innovation and creativity throughout the book. She contrasts innovation with invention and improvement in that "innovation refers to the notion of doing something differently rather than doing the same thing better". She cites Clay Christiansen's work in the Innovator's DNA who identified that innovator's have 5 key discovery skills: they are associating, questioning, observing, networking and experimenting. They are also curious, observant and ask a lot of questions. Ms. Piscione also includes her own observations that the top entrepreneurs are passionate, authentic, driven by ideas, fearless in risk-taking, trustworthy and resilient.
The last chapter explains what it is like to grow up in Silicon Valley. She cites the great educational institutions for youth, with even innovation schools for pre-schoolers, the exposure to so many business leaders and the peer culture of so many youth with interesting pursuits. The author also observes the high rate of involvement by fathers in the caretaking and education of their children.
View from TAB
Rather than just provide the book perspective, I asked Bob French, TAB Facilitator in the area, what his observations were. He agreed with the insights with the book. He also comments that "the acceptance of failure goes pretty deep. I was part of a group interviewing a candidate on behalf of a customer for a key management position and discovered during the process that the individual had gone bankrupt. The reaction from our group was, 'good, now he knows what it takes.'"
He also clarified that, locally, the definition of Silicon Valley is now pretty well considered the whole Bay Area. Per Bob, "Innovation and tech start-ups are part of the whole ecosystem and culture here. Anybody with a good idea is welcome and the attitude is let's hear first before we reject."