The Same or Different? Open or Closed?

I spent the last week of November 2012, in Tunisia, in North Africa, talking with private equity and venture capitalists, entrepreneurs, development banks, NGO’s and State Department personnel on the topic of post-investment portfolio support.   There was high interest in understanding and implementing Silicon Valley’s best practices for supporting and growing startup portfolio companies to enable them to achieve their milestones. 

After visiting dozens of countries during the past 5 years, this was my first visit to Africa.  One clear take away from the trip, and an essential element for a successful entrepreneurial ecosystem, is that diversity, tolerance and open mindedness have always been a cornerstone of the Tunisian economy and culture.  I met some exceptional people that can trace their heritage to France, Spain, Turkey, Italy, the Middle East, and nearly every part of the African continent.   There was tremendous diversity in building architecture; the beautiful Tunisian doors and Roman mosaics. The food was delicious and quite different with incredible hints of cinnamon, basil, cardamom and hot peppers.   The faces of the Tunisian people reflected that cultural mix as well, with their beautiful round faces, chiseled faces, dark skin, light skin, heads covered and uncovered.  They have it all.

Tunisia is where the Arab Spring began in January 2011. With help from social media, a revolution occurred that quickly overthrew a dictatorial regime and replaced it with a regime that, today, is beginning to look a lot like the old regime.  Nearly 2 years on, there is still no constitution in place, and frustration is increasing and tensions rising, as quickly as the unemployment rate.   It seems this new regime is less tolerant and seeking more homogeneity.   Worldwide, we see that intolerant governments and ‘closed’ countries do not attract the tourism nor the foreign direct investment that creates jobs and improves economies.

The Silicon Valley ecosystem is founded upon openness, diversity and tolerance, although with a much shorter history than Tunisia’s.  More than 120 languages are spoken in Silicon Valley and it’s not unusual to see a startup team comprised of people with multicultural backgrounds and ties to India, China, Korea, and Eastern Europe.  While they may not eat the same foods for lunch, their diversity generally is an indicator that they will build both a better product and company.  

I find the CEOs of these inclusive companies are usually more self-aware as human beings, because they have to be much more sensitive to the range of perspectives within their team and have to be highly effective at both building consensus and leading the company-- especially when things don’t go according to plan, which always happens in a startup.

Take a look at your team, your colleagues and your friends.   Does everyone think alike?  Do you choose like-minded individuals to hang out with?  Or do you sustain yourself with a variety of ideas and perspectives?  Within your company, is there freedom to think creatively?   How are contrary points of view handled?  Are they accepted and debated, or rejected and eliminated?  Can you challenge the status quo?  Do you feel more empowered when with people who are the same or different from you?  The answer to that last question may be the most telling.

Great companies are built over time and in many different ways.  Diversity and openness, in both the employees and the company’s approach to the market, is generally a strong indicator of better products and services and ultimately, a better world.   Our differences truly do make us stronger. 


Radical Thinking @ Sea

An attribute of Silicon Valley I have always appreciated is the big visions of entrepreneurs and their ability to infect, interest and inspire others with that vision.

The vision of the Blueseed Project is big, radical and inspirational.  It’s a ‘no visa required’ ship moored 12 miles off the coast of Silicon Valley, California.  As a live/work ship for entrepreneurs, Blueseed will have high-speed internet access, cool living quarters, and daily ferry service to the mainland.  Once on land, it’s less than one hour’s drive to San Francisco, venture capitalists, major universities and startups of every kind.   A thousand of the most interesting and exciting entrepreneurs will be part of the Blueseed community, living on this ship, when it launches at the end of 2013.

Blueseed is radical.  Just think about it.  A ship off the coast of California, in international waters, far away from the US government’s jurisdiction in visas, immigration, customs and taxation.  Yet close enough to Silicon Valley’s amazing ecosystem of entrepreneurs, investors, universities, service providers, research labs, and the high energy and creativity of the world’s most innovation ecosystems. 

Blueseed is similar, in some ways, to an incubator or accelerator. They will provide access to service providers (legal, accounting), mentors, coaches, educational programs and take an equity stake in each company.   Blueseed will receive compensation in the form of rent ranging from $1200/month to $3000/month.  Eventually, other sources of revenue would kick in, including corporate sponsorship and advertising, reality television shows and more.  (Of course, the ubiquitous reality TV has to be in the mix!)

What differentiates Blueseed from other incubators and accelerators, other than the fact that it’s a ship moored out in the ocean, is that this community of entrepreneurs and startups will be completely unconstrained by the type of work they must perform as required by many US visa restrictions.  Some entrepreneurs don’t think they can complete their innovative startup work quickly enough within the timeframes of a work visa, which is typically 180 days.  Being unaffected by a visa timeline allows important and radical ideas to develop naturally and flourish.  Adequate time to prove the concept, build the company and become sufficiently sized to get funding will improve the chances of securing the requisite visa(s) from US Customs & Immigration Service.  By that time, chances are high that the company is creating jobs and adding tax revenues to the both the state of California and the US government.  More than 1000 entrepreneurs have already expressed interest in Blueseed.

While Blueseed’s current hurdle is raising the full $50 million necessary to purchase and retrofit a suitably sized cruise ship, we will undoubtedly see and hear more from them over the coming months.    Blueseed CEO and entrepreneur, Max Marty, was part of think tank studying solutions for building communities on the ocean.  Sprinkle in his MBA, finance, and philosophy educational background and we could have the radical thinking necessary to create the right environment to foster far-reaching creativity in entrepreneurs and startups.  This environment, the Blueseed Project, is about to address a very real pain point in the market—facilitating startup innovation and creativity, unconstrained by visas, in close proximity to Silicon Valley. 

Let’s just sea what happens.  


The Magic of Silicon Valley

This year, the fall season in Silicon Valley is not about harvesting crops.   It’s about planting seeds, seed funding and seed rounds.   September through mid-November typically represent a full schedule of conferences, events, meet-ups and networking opportunities.  This fall is clearly different than past seasons.   Within the past 60 days, we’ve seen startup delegations from Brazil, Korea, Russia, Poland, Denmark, Australia, Mexico, Chile and elsewhere, all arriving to visit, understand and connect with Silicon Valley.  And more are coming.

Silicon Valley is one of the most impressive innovation ecosystems in the world, a unique configuration of entrepreneurs, investment capital, supporting partners, and customer opportunities.  Venture capital investments are up, IPO’s are up, SBIR/STTR grants are up, office vacancies are low, and unemployment continues to stay below the US national average.  Yet on the surface it might appear as simply a configuration of big and small players.   If you look past people, partners and players in the ecosystem, there is a distinct set of values super imposed over this network, those of trust, openness and transparency, and collaboration. 

We’re bullish on execution, possess unending optimism, and openly talk about how much cash a company has left.  We’re more comfortable with risk and failure and know it’s an inevitable part of the process.  We celebrate diversity because it’s both our heritage and our future, and we have a tendency to think big and build global, from the start.  Go big.  Or go home.

Entrepreneurship is on the rise worldwide.  It stands to reason that the global economic crisis has been a big contributing factor in the increase of entrepreneurs, governments, incubators, and journalists studying the fabric of Silicon Valley and how to both adopt and adapt its best practices.  Ideas now move faster than ever too.  Social media, and its effect on the Arab Spring, is an excellent recent example of how ideas can quickly spread across the globe.  The drive to create more entrepreneurs and startups has given rise to an unprecedented increase in startup competitions around the world--many with cash prizes, corporate and government acceleration programs, training boot camps, meet ups, entrepreneurs- as-investors, and many more sources for seed capital.

However, amidst all the hype and activity, one thing is crystal clear—this ecosystem exists because of risk-taking entrepreneurs and we’re here to support them. The entrepreneur leads and everyone else follows. 

Join me during the coming months as we look at the remarkable interplay between people, culture and environment that defines Silicon Valley, a region renowned for creating and growing a new startup every day and home to the worlds’ most successful corporations; the magic that is Silicon Valley.

I will look at the role universities play in the ecosystem, not just in teaching entrepreneurship or graduating engineers or scientists, but how they support students and graduates with accelerator facilities.  

The venture business has changed since its inception in the last 1970’s.  I’ll interview a range of investors and look at the increasing number of angels, super angels, and micro VC’s and how smaller funds are filling a big need with startups.

International bridge organizations, incubators, accelerators, and co-working spaces, make for both a soft landing zone and a community of like minded supporters for entrepreneurs.   Service providers such as attorney, accountants, pitch coaches, and market entry experts, are equally important as part of the entrepreneur’s trusted network.    I’ll also look at very limited role of government and how business-led regional development influences what happens in Silicon Valley.

Finally, everyone has a story.  Of all the entrepreneurs I’ve met, and there have been thousands, no one has failed to touch me with their drive, inspiration, motivation, failure, mistakes, ambition, curiosity, and success.   So through all of this, I want to share their stories with you.   After all, they lead.   We follow. 

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Oct 14, 2012:  Silicon Valley is one of the most impressive innovation ecosystems in the world, a unique configuration of investment capital, supporting partners, and customer opportunities overlaying a distinctive culture of success and societal norms, known as the Silicon Valley State of Mind.   Some important tenets of the valley include the attitude towards risk and failure, the celebration of cultural diversity driven by immigrant entrepreneurs, a priority placed on execution over idea, and the tendency to think big and be global from day one.

Representatives from hundreds of cities and regions around the world, along with many international journalists, have visited and closely studied the Silicon Valley ecosystem.  Rather than adopting every Silicon Valley best practice, Israel and Singapore have successfully adapted them to their culture, existing ecosystem components and business style.  Israel has the highest R&D spending, relative to GDP, of any country in the world and is attracting US venture firms with billions of dollars to invest.  Singapore, a premier financial hub of Asia, has a large supply of skilled labor that embraces next-generation technology faster than much of the world. Singapore was also just ranked the most innovative country in Asia and continues to churn out thousands of new startups every month.

Join us for a 2-week Study Program, June 22- July 7, 2013, as we visit Silicon Valley, Singapore and Israel, three of world’s most innovative ecosystems.  Each region is creating sustainable companies and acting as vibrant economic engines for growth and innovation in the world.   We will meet business and government leaders, key influencers, academics, thought leaders, investors and entrepreneurs, attend events, and participate in roundtable discussions and working sessions.  This program is not theoretical.  We will meet with practitioners to discuss their advice and guidance, guerilla tactics and their ‘street level view’ of their ecosystem.  Every organization we meet will be encouraged to include entrepreneurs and startup teams in our discussions.   This educational program begins in Silicon Valley, moves to Singapore and concludes in Tel Aviv, Israel with a Wrap up, Planning and Implementation Session.  There are only 14 slots available and the entire 2+ weeks promises to be a rich and rewarding learning experience.