Make Your Own Silicon Valley

SEATTLE – California may be the world’s largest and best-known technology hub, but it is not alone in fostering innovative startups. In fact, such firms are emerging – almost unnoticed – everywhere, from Asian megalopolises like Singapore and Shanghai to small European cities like Espoo in Finland and Dwingeloo in the Netherlands. Many international startups – including Sweden’s Spotify, Estonia’s Skype, Israel’s Waze – and, most recently, China’s Alibaba – have gained billion-dollar valuations.

Clearly, the key features of Silicon Valley that foster innovation and entrepreneurship – a dense concentration of human talent, a competitive spirit, easy access to capital, and a supportive regulatory environment – can be replicated in and adapted to a wide variety of contexts. Indeed, these pillars of creativity and progress have been erected even in countries whose economies, politics, and cultures diverge sharply from those of the United States.

Of course, not every country approaches innovation in the same way. Finland, for example, owes its dynamic computer-games cluster largely to a student-driven movement in higher education. Though Rovio Entertainment’s release in 2009 of the popular video game Angry Birds catalyzed an innovation boom in Espoo, it is Aalto University – Finland’s equivalent of Stanford in California – that continues to fuel innovation in the area, by nurturing programmers, designers, and others with the necessary talents. Aalto students also have launched Europe’s most dynamic startup conference, which will bring together more than 10,000 entrepreneurs and financiers this November.

Moreover, the university’s Startup Sauna seed-accelerator program helps promising early-stage startups take their first steps toward success. Located on campus, the program’s facilities resemble colorful Google offices, but with a Finnish twist: video conference rooms have been built into sauna-like structures. Since its establishment in 2010, 126 companies have graduated from Startup Sauna, having raised more than $37 million in funding.

Today, Finland boasts more than 200 gaming startups, which export 90% of their products. According to Aalto, Finland’s gaming sector experienced 260% revenue growth in 2012-2013, adding 1,000 jobs and $1.5 billion in total value to the Finnish economy just last year.

In the Netherlands, the government has taken the lead in promoting innovative activities. Two and a half years ago, the Dutch government teamed up with IBM and a group of small and medium-size local businesses to jumpstart a big-data hub in the far-northern village of Dwingeloo, home to the Netherlands Institute for Radio Astronomy.

Like Silicon Valley-based initiatives, the project unites academia, talent-rich local companies, and multinationals behind a common goal – in this case, to build the world’s largest radio telescope. The device will process and analyze radioactive waves collected from two million individual antennae, enabling researchers to map the shape of the universe by (they hope) 2020. IBM provides the processing power for the data, while local Dutch companies are building all of the components.

Beyond its own specific objectives, the initiative can help to catalyze a broader transformation of the Dutch tech culture. Jan de Jeu, Vice President of the University of Groningen, anticipates experts in Dwingeloo and the northern Netherlands training more scientists and IT specialists in the fundamental challenges related to the storage, transfer, and analysis of enormous data sets, thereby creating what de Jeu calls “The Data Industry Valley.”

In Southeast Asia, Hong Kong benefits, first and foremost, from a business culture that is unencumbered by either red tape or corruption. It takes about two days to set up a new business; taxes are low; and ample co-working spaces are available.

Furthermore, the government-funded Cyberport Incubation Program supports the development of Hong Kong’s information and communications technology industry by providing companies with start-up capital, access to advanced facilities, and training in entrepreneurship, technology, and business development. As a result, the number of entrepreneurs has grown by 300% in the last three years.

For its part, Singapore is increasingly seeing the effects of a decade of regulatory reforms, including government grants and tax incentives to encourage foreign investment in the technology sector. In 2002-2009, more than 11,000 startups were established.

Singapore’s social-media startup Bubble Motion (recently rebranded as Bubbly) generated more than 20 million users in its first two years – nearly double the number that Facebook or Twitter accrued in the same period in their history. It counts influential Silicon Valley firms such as Sequoia Capital, Northgate Capital, and Comcast Ventures as investors.

On mainland China, Alibaba recently made history by raising $25 billion in the world’s largest initial public offering to date. Company founder Jack Ma said that his ambition is to create a thriving “ecosystem” around the corporate headquarters in Hangzhou. Alibaba employees, ex-employees, and stockholders already injected more than $6 billion to the local economy in 2013, with Zhejiang University and the Fudi Startup Incubator Centers (founded by a former Alibaba employee) encouraging frenetic startup activity.

California’s enclave of tech companies remains the crown jewel of entrepreneurial ecosystems. But international innovators are increasingly recognizing that, as valuations in Silicon Valley soar, the real bargains for tech-savvy investors may be found outside of the US.


Ross Buchanan is an author at UP Global.

Copyright: Project Syndicate, 2014.
www.project-syndicate.org

 


This article is brought to you by Project Syndicate that is a not for profit organization.

Project Syndicate brings original, engaging, and thought-provoking commentaries by esteemed leaders and thinkers from around the world to readers everywhere. By offering incisive perspectives on our changing world from those who are shaping its economics, politics, science, and culture, Project Syndicate has created an unrivalled venue for informed public debate. Please see: www.project-syndicate.org.

Should you want to support Project Syndicate you can do it by using the PayPal icon below. Your donation is paid to Project Syndicate in full after PayPal has deducted its transaction fee. Facts & Arts neither receives information about your donation nor a commission.

 

 

Browse articles by author

More Current Affairs

Added 12.07.2018
The cabinet members who resigned this week apparently feared that politics is taking May toward a “soft Brexit,” their worst of all possible worlds........“soft Brexit,” maintains the status quo, more or less, letting Europeans freely circulate into British labor markets and allowing European firms to operate easily in the UK. The problem with “soft Brexit” is that it raises questions about why the UK is leaving at all, since it will still have the same obligations to Europe as before, it just won’t have a voice when the remaining 27 members of the European Union meet to make decisions.
Added 12.07.2018
One study on the 2010 World Cup found that there was a 37.5% rise in admission rates across 15 accident and emergency departments on England match days........Examining reports of domestic abuse in Lancashire (a county of approximately 1.5m people in Northern England), across the 2002, 2006 and 2010 World Cup tournaments, we discovered a 26% increase in reports of domestic abuse when England won or drew, and a 38% increase when England lost. Reports were also more frequent on weekends, and reached their peak when England exited the tournament.
Added 10.07.2018
If, back in the 1980s and 1990s, the US government, rather than arguing for Chinese economic opening, had prohibited any US company from investing there, China’s rise would have been significantly delayed, though not permanently prevented. Because that did not happen, China’s rise is now self-sustaining. A huge and increasingly affluent domestic market will make exports less vital to growth.
Added 10.07.2018
Comparing today’s demagogues with Adolf Hitler is almost always unwise. Such alarmism tends to trivialize the actual horrors of the Nazi regime, and distracts attention from our own political problems. But if alarmism is counterproductive, the question remains: At what point are democracies truly in danger? What was unimaginable only a few years ago – a US president insulting democratic allies and praising dictators, or calling the free press “enemies of the people,” or locking up refugees and taking away their children – has become almost normal now. When will it be too late to sound the alarm?
Added 09.07.2018
In view of such actions, expectations for Trump’s behavior at the upcoming summit have gone from prickly to dangerous. The sense of foreboding has been heightened by the announcement that, just four days after the summit ends, Trump will meet with Russian President Vladimir Putin, in Helsinki. The nightmare scenario is easy to imagine: Trump lays bare NATO’s fractures, including by questioning mutual defense, before selling his allies down the river by publicly embracing Putin. But this does not need to be the outcome.
Added 09.07.2018
After 2027 (or maybe even 2025, only 7 years from now), the number of EVs will rapidly accelerate, as virtually all new vehicles bought will be electric (an effect of rapidly falling battery and other component costs and of the fuel for electric cars being essentially free; you can power one off your rooftop solar array).
Added 03.07.2018
Most pundits interpret Trump’s outbursts as playing to his political base, or preening for the cameras, or blustering for the sake of striking future deals. We take a different view. In line with many of America’s renowned mental-health experts, we believe that Trump suffers from several psychological pathologies that render him a clear and present danger to the world.
Added 03.07.2018
In the United Kingdom, Brexit looms large, with everyone from government ministers to tabloid newspapers frothing daily about the deal that will be struck with the European Union and the effects that it will have. But the EU faces too many pressing challenges to be obsessing about Britain. The UK’s concern is understandable: evidence is mounting of the likely damage a departure from the single market and customs union will do to the UK economy. According to new research from the Centre for European Reform, the UK economy is already 2.1% smaller than it would have been had voters chosen to remain. The hit to public finances totals £440 million ($579 million) per week.
Added 26.06.2018
Nowadays, Britain’s words and actions on the world stage are so at odds with its values that one must wonder what has happened to the country. Since the June 2016 Brexit referendum, British foreign policy seems to have all but collapsed – and even to have disowned its past and its governing ideas. Worse, this has coincided with the emergence of US President Donald Trump’s erratic administration, which is pursuing goals that are completely detached from those of Britain – and of Europe generally. 
Added 26.06.2018
With each passing day, it becomes increasingly evident that US President Donald Trump’s administration cares less about economics and more about the aggressive exercise of political power. This is obviously a source of enormous frustration for those of us who practice the art and science of economics. But by now, the verdict is self-evident: Trump and his team continue to flaunt virtually every principle of conventional economics.
Added 26.06.2018
The sights and sounds of Central American children being ripped from their parents by US Border Patrol officers have, by now, spread across the globe. The experience has been traumatizing to its victims and deeply painful to watch. It has also done incalculable damage to the very idea of America. This is June when we are supposed to be celebrating "Immigrant Heritage Month". Each year, I have taken this opportunity to recall my family's immigrant story - the opportunity and freedom they sought, the hardships they endured, and the remarkable progress they made in just one generation. 
Added 24.06.2018
State terrorism comes in many forms, but one of its most cruel and revolting expressions is when it is aimed at children. Even though U.S. President Donald Trump backed down in the face of a scathing political and public outcry and ended his administration’s policy of separating migrant children from their parents, make no mistake: His actions were and remain a form of terrorism.
Added 22.06.2018
It is now clear that the twenty-first century is ushering in a new world order. As uncertainty and instability associated with that process spread around the globe, the West has responded with either timidity or nostalgia for older forms of nationalism that failed in the past and certainly will not work now. Even to the most inveterate optimist, the G7 summit in Quebec earlier this month was proof that the geopolitical West is breaking up and losing its global significance, and that the great destroyer of that American-created and American-led order is none other than the US president. To be sure, Donald Trump is more a symptom than a cause of the West’s disintegration. But he is accelerating the process dramatically.
Added 20.06.2018
Sessions quoted a line written by the apostle Paul to a small community of Christians living in Rome around 55AD to defend the Department of Justice’s approach. He said: "I would cite you to the Apostle Paul and his clear and wise command in Romans 13, to obey the laws of the government because God has ordained them for the purpose of order." Sessions used the Bible because one of the most vocal opponents of the crackdown on asylum cases has been the Catholic Church. It’s no surprise that Sessions appealed to Romans chapter 13 verse 1 in response: not only did he hope to undermine Catholic authority by using the Bible against them, he cited a statement so broad that one might use it to defend anything a government does, good or bad. Picture below St Paul writing his epistles, by Valentin de Boulogne, via Wikimedia Commons.
Added 19.06.2018
 

I find it exceptionally irritating when I hear liberals worry about whether Israel will be able to remain a "Jewish and Democratic State" if it retains control of occupied Palestinian lands.

Added 18.06.2018
Daniel Wagner: "My prediction Korean War will be formally ended, the peninsula will be denuclearised, and a lasting peace will be the result."
Added 14.06.2018
Extract: PiS [ the ruling Law and Justice party] has established the most significant addition to the Polish social safety net since 1989: the Family 500+ program. Launched in 2016, Family 500+ embodies the nationalism, traditional family values, and social consciousness that the PiS seeks to promote. The program pays families 500 złoty ($144) per month to provide care for a second or subsequent child...........The program has been enormously popular. Some 2.4 million families took advantage of it in the first two years. The benefit, equivalent to 40% of the minimum wage, has almost wiped out extreme poverty for children in Poland, reducing it by an estimated 70-80%........... Liberal pro-European politicians and policymakers are not convinced. They complain that such a generous family benefit will weaken work incentives and blow up the government budget. But initial evidence suggests that Family 500+ has actually increased economic activity. It has also reversed the post-communist decline in fertility, increased wages (particularly for women), and enabled families to buy school materials, take vacations, buy more clothes for their kids, and rely less on high-priced credit for basic household needs. And, thanks to rapid economic growth, the government deficit has steadily fallen, not grown.
Added 12.06.2018
The depths of hypocrisy of the Republican Party in supporting Trump’s meeting with the North Korean dictator in Singapore are hard to plumb. This is a party whose leading members adopted the Ostrich Foreign Policy Principle for decades. If you don’t like a country’s government or political and economic system, pretend it does not exist.
Added 12.06.2018
US Defense Secretary Jim Mattis has spoken out against China’s strategy of “intimidation and coercion” in the South China Sea, including the deployment of anti-ship missiles, surface-to-air missiles, and electronic jammers, and, more recently, the landing of nuclear-capable bomber aircraft at Woody Island. There are, Mattis warned, “consequences to China ignoring the international community.” But what consequences?