Can Europe copy Silicon Valley?

Every week, I get asked the "Silicon Valley question". This week alone, it came up at least three times. I had a phone call with a Belgian start-up asking me for my thoughts on whether to start their company in Belgium or in Silicon Valley. This afternoon, iMinds, a Belgian research institute that promotes entrepreneurship, visited me at Acquia to talk about similar topics.

There are advantages and disadvantages to being in Silicon Valley, and we could argue them to death. Not every great technology company is based in Silicon Valley, and there are many successful entrepreneurs who aren't in the valley. However, I bet you that deep inside every one of those entrepreneurs wonders whether it wouldn't be better to be in Silicon Valley. More often than not, it actually would be better.

This morning I got a message from Bart Becks, a well-known Belgian entrepreneur and angel investor. He asked for my thoughts on an article he is writing about whether Europe could replicate the Silicon Valley phenomenon. To me, this is the more interesting "Silicon Valley" question.

Europe has no choice but to reinvent itself to become more like Silicon Valley. Entrepreneurs, not the government, will actually change the world. While the government's role is to foster entrepreneurship, clearly the government on its own isn't capable of changing Europe fast enough.

Silicon Valley is a state of mind. To recreate Silicon Valley in Europe, Europe has to adopt Silicon Valley's culture first. That culture has developed around the desire to continuously reinvent everything, including oneself. That is what keeps Silicon Valley relevant, and what Europe needs to emulate most. Once Europe has established a Silicon Valley-like culture, it can slowly mix in the other ingredients that make Silicon Valley successful: money, smart venture capitalists, better engineering talent, better creative talent, and more. But let's start with the culture.

There are other aspects of the Silicon Valley culture that all of Europe should adopt. The Silicon Valley culture encourages people from all over the world with different cultural backgrounds and diverse skills to physically come together, inspire each other, and try to accomplish something unique and game-changing.

I also believe that Europe should adopt part of the American Dream: the egalitarian belief that everyone is able to succeed through hard work, and that it is acceptable and encouraged to better oneself economically through hard work. It doesn't mean Europe needs to give up its strong communal beliefs and its desire to look out for the greater good. I hope the European financial crisis represent a watershed moment that causes Europe to rethink some of its current models.

America's social history wasn't necessarily pretty, but it has created a culture where multiculturalism, ethnic diversity and thoughtful capitalism are part of the national character. I'm worried it may take Europe a couple generations to truly embrace such a culture. Until that happens, we'll see some regional and national successes, but not the European-wide "Silicon Valley" culture that Europe needs to successfully reinvent itself.

Comments

Lukas (not verified):

Well the problem with all the positive things about Silicon Valley is that its build around an ideology that says that believes that anyone who isn't striking it big is a lazy screwup not worth any consideration. So with that assumption I would say no thanks to importing Silicon Valley to Europe. That being said, I agree in so much as that it should be possible to have this "the egalitarian belief that everyone is able to succeed through hard work" without going to turn to such ideology. Its not like I appreciate this belief that good ideas always need to go through the old paths for them to be worth the risk of exploring.

January 17, 2013
Tom (not verified):

Completely disagree with this characterization of Silicon Valley. Many people have failed in Silicon Valley and been recruited to work at some of the largest, most successful valley (and global) companies.

January 23, 2013
A Dutch American (not verified):

I am afraid a lot of Europeans see Silicon valley (Or the USA) like Lucas sees us and then the answer is clear: NO.

Another angle is my (poor) translation of a well-known Dutch saying "as soon as you stick your head up above the grass they will chop it off". Those are not the conditions you need to create a Silicon valley in Europe.

January 18, 2013
Another Dutch A... (not verified):

I think a problem is the segmentation of Europe that makes it very hub'esque. The difference however is that these hubs are far less connected than hubs in the US. Take SF and NYC, besides the general vibe, the culture is almost interchangeable. If you compare that to Paris and Berlin, you'll find far greater differences. We've studied these differences at Foundervous and are trying to bridge the gap.

January 22, 2013
Aaron (not verified):

WARNING: This comment contains gross generalizations.

There is little chance of anything like this happening. The culture of Silicon Valley elevates work above all else and is the reason for all the successful companies. You cannot have that culture in Europe as people here generally value other aspects of life over work. This is a fundamental schism between European and American lifestyles. The Americans see the Europeans as lazy and the Europeans see the Americans as greedy. You never hear about the success rate for marriages or how close people feel to their families in Silicon Valley.

The only potential place for this to occur might be England as that is really one of the major birth places of what evolved into "the American Dream." Even England, however, still values leisure time more than Americans.

January 18, 2013
kvantomme (not verified):

I think the most important quality of silicon valley culture is that it allows for failure. A fail fast mentality is I think at least as important as "the egalitarian belief that everyone is able to succeed through hard work". Too many Europeans try to find a nice and cozy job that is as risk-free as possible. This is a pure cultural thing, since it should actually be safer in Europe to take risks because of the safety net of social security programs.

January 18, 2013
Lorenz Bogaert (not verified):

Europeans should first of all speak the same language ... Let's start with that. ;) No common market without common language and culture ...

January 19, 2013
Jeff Eaton (not verified):

"I also believe that Europe should adopt part of the American Dream: the egalitarian belief that everyone is able to succeed through hard work, and that it is acceptable and encouraged to better oneself economically through hard work..."

The downside is that this dream has become more and more of a mirage here in the United States over the past half-a-century or so. Growing wealth and income disparity, and a steady but undeniable decrease in income mobility, are the reality.

Startup culture in the US is noteworthy in that the crushing hours and personal sacrifices do occasionally result in a lottery-win success. In most other vocations here, that's not the case. The odds are still extremely long, however, and while Silicon Valley may be a model for technological innovation it often relies on the darkest side of the American Dream: the dangling carrot of a casino-style payoff.

As an American, I can't comment on the differences between our perspective and the European one. Friends of mine who live in Scandanavia have observed the same dynamic you discuss -- a cultural reluctance to seek "breakout success." The challenge is finding a healthy middle ground, where dynamic experimentation and competition can be encouraged but the dream being offered is more than an Esau-style trade of one's personal life for a stock options lottery ticket.

January 19, 2013
Dries:

I certainly agree with finding a healthy middle ground. Most startups I know are probably jealous of breakout success, but aren't actually focused on achieving breakout success themselves. The dream remains but I think reality grounds them pretty fast -- and they seem pretty content with that.

January 20, 2013
mori (not verified):

I am also working for a great project in Ibiza called "The Zoo Project" and one of their slogans is "Create your own culture" and I am not a friend of the "copy" word. I prefer to say "learn" or "adopt" as you mentioned it later ;-)

Europe is NOT America and especially L.A., San Francisco and Silicion Valley in my opinion are not the typical America.

Nevertheless one spot in Germany, maybe the one in Europe which has all this culture mix of people, fashion, startup-feeling is BERLIN.

Of course especially from my point of view this is deeply connected with the electronic music scene and a lot TOP DJ´s live now in Berlin e.g. Ritchie Hawtin, the DESOLAT-Crew around Loco Dice and many more.

Soundcloud's HQ is in Berlin, Native Instrument has a huge base there and Google is also there growing.

Berlin is also big in art, fashion, currently there's FASHION WEEK, movie and entertainment. A great startup in this is ZALANDO (a online fashion shop, started as a shoes-shop) which has grown in Germany very well is is now expanding to Europe.

Finally I think the spirit is there and the important thing are to bring that together.

A very cool example how things should work is the project "Holzmarkt" where the good guys from the scene where able to get investors and competed well with the "money only" guys -> http://www.berliner-zeitung.de/berlin/holzmarkt-genossenschaft-gibt-hoec... (only german).

January 20, 2013
mori (not verified):

Another issue as "Lorenz Bogaert" mentioned very right is the border of languages. A special example is e.g. Barcelona in Spain which is Catalan and they started a movement to split themselves from Spain which failed, but shows the topic very well.

Therefore maybe the solution is not "the one place" but a good connection of "hot spots" like e.g. "Bruessels, Berlin, Barcelona, Paris, Prague, London ..." with a network working together hand in hand and not competing against each other as Jeff admitted: "The challenge is finding a healthy middle ground".

January 20, 2013
Netsensei (not verified):

I would like to add that the world is more then just Europe vs America. We should not forget about Asia where economic hotspots like Hong Kong or Singapore are veritable Silicon Valleys on their own.

A friend of mine is a budding entrepreneur in SG. I went to visit him in early 2011. What I saw baffled me: SG invests proactively in entrepreneurship and technical innovation through education, fiscality,... creating an entreprisefriendly environment. Except for my friend, I hadn't any contact over there yet within 24h I got invitations to be the lead speaker at the SG Drupal Group and an aspiring meetup of entrepreneurs presenting their projects!

The most startling thing for us Europeans is that Singapore was economic pretty much backwards until their independence from Malaysia in the sixties. So, what happened? In 50 years times, they went through heavy reforms to get there. How come? Partly because of their history, being a former colony, partly because SG was always an economic hot spot in the SE Pacific, partly because the time was just right for them to pick up speed.

With the good comes that bad. In order to become so efficient, SG installed a technocratic regime with minimal involvement from the public. It works, but it's not a democracy. There are social reforms, but I also encountered poverty and hardships. i.e. housing prices are so high that it's nigh impossible for young families to buy their own home. Let alone rent a decent appartement. Nor do you have to count on a comfortable state pension if you haven't thought of a pension plan during your career.

We Europeans are "spoiled" in a sense that we have invested heavily in a social infrastructure where public services are there to guide the public through each step in their lives. Such system does not only come with a heavy economic penalty (taxes) but also a heavy cultural penalty: we are hooked to a system where we, Europeans, are taken care of. The perception of an entrepreneur over here is someone who deserves suspicion because rather then let the system take care over him, he wants to do it on his own.

In a sense, the cultural shift will probably be far more problematic then an economic shift. Yes, silicon valley like regions might start to pop up over the coming years, but it's far from certain that we can adopt the same mindset as they did in Asia. As Jeff Eaton said: finding a healthy common ground will be the biggest challenge and that will probably take longer then we actually need right now.

January 21, 2013
Filip Moerman (not verified):

Why Europe always wants to copy? Do not make a Silicon Valley, make something better and unique. Rethink and renew.

January 29, 2013
Mark (not verified):

Many good comments, to which can be added (and ties in to some of the above) a greater tolerance in Europe for protecting those 'in' a group at the expense of those 'out' of the group and the innovation and competitiveness they could bring. This shows up in, for ex., protected professions (taxis, pharmacists, various others in various countries) where insiders have license to practice but outsiders can not get in; big differences in protection for full-time vs part-time workers; proportionally-larger youth unemployment; and even regulated fields like wine (where only those within a boundary receive benefits, but are then restricted from innovating with new grape varieties or substantially-different styles).
This is somewhat of a broad generalization, as people everywhere tend to lobby for protection for what they do and have, but overall there seems to be more of a framework and public acceptance for this in Europe, with the hidden cost of keeping potentially productive workers/companies out of work they could be doing, and a reduction of innovation and competitiveness in those fields.

January 30, 2013
klima servisi (not verified):

Europe is NOT America and especially L.A., San Francisco and Silicion Valley in my opinion are not the typical America.

Nevertheless one spot in Germany, maybe the one in Europe which has all this culture mix of people, fashion, startup-feeling is BERLIN.

Of course especially from my point of view this is deeply connected with the electronic music scene and a lot TOP DJ´s live now in Berlin e.g. Ritchie Hawtin, the DESOLAT-Crew around Loco Dice and many more.

February 21, 2013
kombi servisi (not verified):

The only potential place for this to occur might be England as that is really one of the major birth places of what evolved into "the American Dream." Even England, however, still values leisure time more than Americans.

February 21, 2013

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