Spreading the entrepreneurial contagion

By Francisco Dao , written on July 11, 2013

From The News Desk

In the quest to create new Silicon Valleys there are essentially two schools of thought. The first group considers the ecosystem and tries to replicate it in new locations. They point to elements such as the availability of engineering talent, feeder universities, local incubators, community events, and how much angel and venture capital money are in the area. At first blush, all of this makes sense but it generally hasn’t worked out very well.

The second group claims it’s all about the people and Silicon Valley can never be replicated. This type of thinking is both lazy and arrogant. They disagree with the ecosystem advocates but have nothing else to offer so they pretend the people living in the Bay Area are somehow magically blessed by pixie dust or something in the water. The secret sauce of Silicon Valley may be its people but it’s not miraculous exceptionalism.

I was watching a documentary recently that described inner city violence as a "cultural disease." For communities infected with this epidemic, perpetuating the cycle of violence is a natural course of action because that's what the people see and know. As I thought about this, it occurred to me that almost all human behavior mirrors this model of contagion.

For example, when I was growing up in San Jose in the late 80s, very few people had tattoos. Then in the early 90s tattoos became a favorable cultural norm and much of the young adult population got inked. This happened without any expansion of the tattoo ecosystem. San Jose didn't have to reach X number of tattoo parlors or have a tattoo convention for every party girl to get a tramp stamp and every meathead to get a tribal arm band. Once it became culturally acceptable, people just went out and did it. They found a way to make it happen.

If you're thinking a tattoo is a one time event so the comparison doesn’t apply, here’s another analogy. If we built a bunch of gyms in McAllen, Texas (fattest city in America) would it make a significant number of people in that city more physically fit? Not likely. But if we could create a cultural change in which the people of McAllen viewed physical fitness as an expected norm, people would lose weight by whatever means were available to them and proactively seek out gyms. The ecosystem of facilities is much less important than the societal expectations.

Repeatedly, we see it’s a matter of making a certain type of behavior into an expected cultural norm. In the 90s, people decided tattoos were cool and their friends were getting them so they got one too. It didn’t matter how many tattoo parlors were nearby. People in McAllen think it’s okay to be obese so they don’t take care of themselves which continues the cycle of acceptability. In contrast, here in LA where I live, obesity is not culturally acceptable and most people make an effort to stay in shape. All of these behaviors, good or bad, set up a reinforcing cycle, sometimes to the point of competition.

I believe the key to creating a new Silicon Valley is to make entrepreneurship a cultural and societal norm for the region you’re trying to affect. Once it becomes a norm, it spreads like an infectious disease. If you believe entrepreneurship is what’s expected of you, it’s highly probable you’ll go after it regardless of how many VCs are nearby or whether or not there’s a local tech happy hour.

Entrepreneurship has been the cultural norm in Silicon Valley for years. The venture capitalists followed the culture first. Only later did the culture follow the VCs but at that point the self reinforcing cycle had already begun. The presence of incubators, showcase events, investors, etc. in an area in which entrepreneurship is not an expectation is no different than the presence of gyms in a physically unfit city. The culture won’t be able to take advantage of the components of the ecosystem. So while it’s true that it’s the people who make the Valley tick, it’s not magic. You just have to approach it as a cultural issue. Get the ball rolling and you’ll find you have a contagious cycle of behavior that’s as hard to stop as inner city violence.