There’s Room for More Than One Startup Ecosystem

By Michael Carney , written on April 11, 2012

From The News Desk

There’s room for more than one startup ecosystem. There, I said it! Blasphemy, I know, but hear me out.

Yesterday, with the release of the Startup Genome data, we were once again reminded that people in all corners of this world are magnificently crazy enough to drop everything and take on uncertainty, risk, and stress to chase an entrepreneurial dream.

The Top 10 ranked startup ecosystems according to this report were the all-encompassing Silicon Valley, followed by New York City, London, Toronto, Tel Aviv, Los Angeles, Singapore, Sao Paulo, Bangalore, and Moscow. Guess what? They all do things differently. Any yet they all produce their share of innovative and successful companies.

Each market has its favored product type and target market preferences, its prototypical founding team, and its inherent advantages and disadvantages. Some regions take on more risk than others, (and somehow NYC gets 4 times more “risky companies” to scale than the Valley). Some are more likely to have female founders, or founders with previous startup experience. Interestingly, some regions are shown to work longer hours. (Valley companies work 35% more hours per day than NYC and 18% more than London.)

The granular findings are fascinating, no doubt. And we all can comb through them for nuggets of insight that will improve our individual companies or our local ecosystem. But if that’s all that comes out of this, I think it’s an opportunity lost. The most important takeaway should be that there is no secret formula.

Silicon Valley will always be the granddaddy of them all, but I will keep saying until I'm blue in the face that the rest of the world needs to stop trying to be the Valley or to beat it at its own game. That’s the wrong goal. The goal needs to be to create as many unique and individually relevant ecosystems as possible.

What makes Palo Alto tick, by and large, is non-transferable. Different people, different cultural influences, and different surrounding infrastructure equal a different product. That’s a statement without value judgment.

One of the things that makes me the most excited to be covering the Los Angeles market is that we’re defining every day what this ecosystem is about. As a big city, and one with a long but somewhat sputtering tech past, we carry a lot of momentum. We're still more maneuverable speedboat than a lumbering battleship at this point.

The entrepreneurs and investors that make up the emerging “Silicon Beach” community have gotten over mimicking our northern neighbors. Like other burgeoning startup markets, we’re finding out who we are and what competitive advantages we have.

I love the analogy Sarah offered, comparing the global startup ecosystem to the interconnected Pando Trees. But at risk of publicly challenging my boss, I’d like to add a few shades of grey. Interconnectedness is a critical and inspiring aspect of the startup ecosystem. But the Pando Trees aren’t the only player in the game. The giant redwoods also employ an interconnected root system to survive Pacific Ocean gales. The same is true of the Southern Live Oak, the Leafy Spurge weed and likely others.

Silicon Valley might be the startup world’s oldest living organism, possibly even its largest and heaviest (analogous to the 80,000-year-old, 43 hectare, 6,000 ton colony of Pando Trees in Utah). But the botanical world is full of examples of strong and interconnected colonies, each tailored perfectly to thrive in its own local environment.

If Trevor’s travels and the Startup Genome data have revealed anything, it’s that entrepreneurs are unique, adaptable and resourceful. Those who succeed are those who act boldly, not blindly. It’s no doubt there’s a ton to be learned from ecosystems that have succeeded before, but there is no singular path to the top of the mountain or even singular mountain to summit, for that matter. The more deeply we all embrace this reality the better.