Select Page

Many columns of text and tweets are dedicated to the emulation of Silicon Valley tech companies in our industry.  My obvious response to this is:  why bother?  We will never have all of the same advantages of Silicon Valley — if you truly think that it is the best place to incubate your tech business, then you’d better grab the next bus because you’re wasting your shareholders’ money trying to compromise.  Less attention is heaped on the prospect that, even if you’re in the tech industry, maybe Silicon Valley is NOT the optimal place to be…

Over the past many years living in and/or commuting to Silicon Valley I have watched the tech bubble create a seemingly pervasive culture of adoption and exploration of new technologies.  It’s great.  This makes the job easier for tech entrepreneurs and is a real boost for early-stage web and mobile tech companies, a fact which is not lost on their investors.  One might be tempted to think that this culture breaks the ice for the broader consumer market, and that may well be, but there are plenty of examples of companies who still don’t get it right.  Entrepreneurs often mis-time or misdirect their companies away from bigger market opportunities by getting caught up in Silicon Valley penis envy.  And that’s a shame, because Silicon Valley <> Rest of World.

Here’s an example: If you lived in Silicon Valley, you would assume Palm was knocking it out of the park in the global mobile market with the TREO.  After all, up until recently when you landed at SFO, OAK or SJC and travelled up the freeways of the Bay Area you were bombarded with TREO ads.  And for years when you met with VCs, entrepreneurs, and techies more often than not it was a Palm or Handspring device they were distracted by, not a Blackberry.  But all the while it was the plucky RIM devices and eventually the iPhone that pummelled the TREO in the broader market, which eventually included Silicon Valley.  Why?  Because while it connected with geeks, and benefited from Silicon Valley’s accelerated adoption cycle, it did not quite so successfully fascinate the broader market.

I’m currently experiencing (and I may regret putting this on “paper”) the same phenomenon watching Quora.  Every day I am emailed when one or another geek I know “follows” me on Quora.  These are people who already follow me on Facebook, LinkedIN, or Twitter.  But the thing is: nothing’s happening on my Quora account.  Sure, plenty of geeks are participating in asking and answering geek questions.  A broad, non-tech question I asked three weeks ago pertaining to Vancouver has gone unanswered (sorry, tried to find a link to it but Quora’s UX is so poor I gave up).  I think it’s fair to compare sites like Quora and their older competitors like YahoO! Answers and (which is highly curated), or even the much-maligned Mahalo.  Apart from the geek factor, I don’t get what makes Quora different (except that it’s much more difficult to use, and slightly “social”).  In the end I suspect Quora is perfect for the Valley echo chamber but it will be far more challenged when it’s time to play in Peoria.

There’s a reason some of America’s most successful and creative advertising firms host their creative teams in cities like Minneapolis and Chicago.  The innovative creative culture of cities like New York and Los Angeles would be obvious locales, you would think, however they tend to nurture a social form of introversion.  Living among folks that are more representative of the real marketplace is a huge advantage, providing both osmotic insight and the ability to test ideas cheaply and easily.  The same, I would argue, is true of the Valley — and once you’re embedded there, escaping that culture is really difficult.

Most Vancouver technology entrepreneurs (as well as most tech entrepreneurs not located in the SF Bay Area) that I talk to envy the accelerated adoption cycle of Silicon Valley.  But the early adopter cycle is also a fickle one.  And, more importantly, viewed in perspective it can indeed be a bubble outside of which seemingly “good” products fail.  Being outside of that bubble gives companies the natural ability to see beyond it, and to build products for broad markets (not just early adopters).  That is an advantage that those of us outside of the echo chamber have — unless we cede it by merely parroting what we see being said in the 650 area code.

Twitter didn’t grow into the social phenomenon that it now is because it was being reported on daily in TechCrunch.  Twitter crossed over when it was on Oprah, CNN, and various TV shows.  It crossed over in the New York Times and People Magazine, and through agents like Ashton Kutcher, Perez Hilton, and (yes) MC Hammer.  This may be as depressing as it is enlightening, but people outside the bubble do not read TechCrunch — and while it’s great to be covered, getting covered by @arrington generally only inserts you into the conversation within the echo chamber.

Still, some endeavours working within this sphere can be successful.  Vancouver’s Flickr famously mined that echo chamber — to the benefit of its founders and seed investors.  But how much bigger as a consumer phenomenon could Flickr have gotten if it had partnered with Wal-Mart, say, instead of getting bought by YahoO! ?  My guess is 10x, in terms of users and valuation.  That’s a lot.


%d bloggers like this: