Silicon Valley has a unique blend of innovation and entrepreneurship that has made it a technology phenomenon for 75 years. But a longtime resident and executive there recently told a Utah audience that other places — like Utah — could be the same.
Russell Hancock, president and CEO of Joint Venture Silicon Valley, described the good and bad of the San Francisco Bay Area to a crowd in Park City. The bad includes high housing costs pricing people out of the market and losing tech talent to other places. Those issues for Silicon Valley represent opportunities elsewhere, he said.
“Now, I’m not here to be a booster and say that Silicon Valley should command all this talent and keep the advantage into perpetuity,” he said in a keynote presentation at the Summit Conference, a gathering of corporate directors and officers. “I’m here to tell you there is a changing tide and there is an opportunity for the rest of the world to participate in this phenomenon.
“And who could imagine a better outcome? Why not have multiple regions, why not have numerous – hundreds upon hundreds – of regions all thriving, all using this kind of formula for their approach to economic growth?”
A recent survey by Joint Venture Silicon Valley, which provides analysis and action on issues affecting the Bay Area’s economy and quality of life, indicated that 60 percent of respondents were planning to leave the Bay Area. “Again,” Hancock said, “that represents opportunity.”
Hancock said he often is asked about replicating Silicon Valley elsewhere. “And I would like you to know that the answer to this question is very complicated, fraught with nuance and complexity,” he said.
Silicon Valley, he said, has created a complex ecosystem where “two rare species” — innovation and entrepreneurship — can thrive. No other place has all of the attributes of that habitat, he said.
Those attributes include a results-oriented meritocracy, a culture that rewards risk and tolerates failure, strong capital markets, strong labor markets, favorable government policies, a major university with ties to industry, and strong quality-of-life characteristics.
Asked what Utah’s Silicon Slopes needs in order to re-create the Silicon Valley, Hancock said, “I think you’re already doing it.”
He encouraged Utah to review those Silicon Valley attributes “and have a soul-searching exercise with yourselves to ask if you are, in fact, building that kind of a culture.”
“You need to capitalize on one of your biggest assets, which is you actually do have developable land, and, by the way, a fabulous workforce. People rave about the workforce in the Wasatch Front. It’s really quite amazing.”
The developable land in Utah is in contrast to that of the Bay Area, bounded by water, hills and protected lands, he said. “That, by the way, represents another opportunity for Utah and for other regions that are thinking about their technology futures,” he said.
Another contrast is in infrastructure development. “We just haven’t mastered the art of planning, what you’re doing so effectively with your FrontRunner and the other kinds of infrastructure that you’re building out,” Hancock said.
“Our future, our development, our maturity is quite interesting,” he said of Silicon Valley, “and it’s becoming very clear that we have a lot to be learning from places like [Utah].” He complimented Utah for “your ability to put together regional planning that seems to work, and for it to be broad and inclusive, and for it to be effective, at least by what I’m observing and what I’m hearing.”
Among other elements Utah already has in place is quality of life. People in Silicon Valley have a “work hard, play hard” mentality and a setting that accommodates both. “I’m standing in a place which I consider to have an amazing quality of life,” he said. “It’s wonderful. … There’s a fabulous quality of life that is, for certain, one of your greatest assets.”
Despite its pluses, Utah is lacking an element that binds all of the necessary elements. He likened it to six-packs of soda that have a “plastic-y” thing that holds it all together. Joint Venture Silicon Valley tries to be that in the Bay Area by bringing together leaders, analyzing data, reviewing trends, addressing challenges and mobilizing people.
“To the extent that a region like this [in Utah] does that, you would have a leg up on us, let me tell you, because we have not solved our big, macro regional problems,” Hancock said.
Those problems are “externalities that we are grappling with” as a result of Silicon Valley’s tremendous success. They include the nation’s highest home prices, as well as income inequality and income disparity, he said. Those issues have caused some large media outlets to question whether Silicon Valley can sustain its success.
“They’re onto something, this is for sure,” Hancock said. “We’ve entered a strange, new world. The world we lived in was one where our Silicon Valley companies and the people who led them were viewed as heroic or virtuous. … These were standup people who were building great companies and bringing us products that we wanted. We wanted these products. They were changing our lives, making our lives better, changing the world as we know it.
“Today, Silicon Valley is being viewed with suspicion, distrust. It’s being held up as a problematic place that’s generating products and platforms that might actually be hurtful or vindictive or deleterious, available to foreign actors who can use them for nefarious purposes, changing electoral outcomes and other things like that. So, suddenly, Silicon Valley has this black eye and people are thinking of it very, very differently.”
Still, he said, it’s an open question as to whether another location can put all the vital positive elements in place to mimic what Silicon Valley has created. “I think you can,” Hancock said.
“I think that it’s possible that Silicon Valley’s comparative advantage may finally be shifting. I could be wrong. People have predicted the demise of Silicon Valley for 40 years, and it still hasn’t happened.”