When we first started The Next Silicon Valley several years ago, it was based on places trying to create their own Silicon Valley like innovation ecosystem. We’ve spent plenty of time at conferences like the Global Innovation Summit debating the ingredients of a successful innovation ecosystem, given talks on economic development 2.0 at IEDC conferences, and on the importance of collaboration and of technology enabling that collaboration.
Now, it’s no longer about the label or the question that we are often asked, ‘where is the next Silicon Valley’. Instead, the debate has moved on, since everyone is now living in a ‘Silicon somewhere’ as this article points out. It says that over and over again, local, national, and international media sources are eager to run the story that a new Silicon Valley is emerging in a different part of the world. “Whether it is in the Midwestern United States, or in the Middle East, the bait of an emerging tech boom gives the content consumer the idea that innovation is happening in more places than they realize…”, says the author.
Indeed, we’ve written about places with their own story of how they are developing successful innovation ecosystems relevant to their needs, from the USA to China, as well Brazil, Columbia, the Middle East, India, China, and in Europe.
One of the key aspects of creating successful innovation ecosystems is the collaboration aspect. The Economist Intelligence Unit has articulated this well in a survey ahead of its own innovation conference in Chicago. In its report, ‘Innovation Clusters: Why companies are better together’, it talks about the success factors that have shaped five key clusters – London’s silicon roundabout, Singapore, Estonia, Boulder (USA), and Bangalore (India).
It says innovation clusters require six key ingredients: skills, accommodating policy framework, infrastructure, low cost structures (in early stages), a good lifestyle offering and serendipity. We at The Next Silicon Valley spent a lot of time looking very closely and in-depth at places like Arizona, and could see examples of all of these ingredients working together to create a successful economic development program in terms of delivering outcomes for the development agency.
The Economist report says clusters emerge when a network of companies coexists within a geographic location, allowing each of them to collaborate – and compete – in a way which delivers greater productivity gains than they would achieve in isolation. We looked at trust and collaboration in this article in 2012, and also about the importance of cross-border collaboration. More recently we also looked at the impact of university research across borders too.
As we alluded to over the years in our look at the importance of collaboration, the Economist report also reiterates this – saying clusters attract innovative people. “They network, leading to the crosspollination of ideas. Companies benefit from each other’s success: what one invents, rivals can access,” says the report, referring to tools like Dropbox. “And what one firm invents, others can build on. Think of the ‘sharing economy’, led by trailblazers Uber and Airbnb, in turn giving rise to an army of startups taking the same idea to new applications. The sharing of knowledge, the spillover effects of innovation and the networking that densely populated spaces enable are all key ingredients for startup success.”
What’s key though is that the six factors stated in the report, while being necessary conditions, are not always sufficient. Many places can have all the factors, but may not give rise to a successful cluster. “Their success depends both on individual factors, as well the interplay between them. Good universities are little use if there is no connectivity with industry. A high standard of living is not helpful if immigration policies prevent global talent from moving to the cluster.” The full report and case studies on each of the five clusters it highlighted can be found at this link.
What all this points to is that there is now a much more in-depth debate about how to create a successful Silicon Valley-like ecosystem. We’ve even seen economic development agencies put tenders out for research and reports on best practice for nurturing and creating the ingredients for successful innovation and entrepreneur ecosystems (and yes, we bid on one only in the last few weeks).
So while we now all live in a ‘Silicon somewhere’, every place is emerging with its own individual blend of the key ingredients that are likely to contribute to success in its own way, and not necessarily just trying to replicate Silicon Valley.
[Photograph: Arizona with it’s innovation ecosystems emerging within cities like Phoenix.]