Secrets of Silicon Valley: What Everyone Else Can Learn from the Innovation Capital of the World

Secrets of Silicon Valley: What Everyone Else Can Learn from the Innovation Capital of the World

by Deborah Perry Piscione

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Overview

While the global economy languishes, one place just keeps growing despite failing banks, uncertain markets, and high unemployment: Silicon Valley. In the last two years, more than 100 incubators have popped up there, and the number of angel investors has skyrocketed. Today, 40 percent of all venture capital investments in the United States come from Silicon Valley firms, compared to 10 percent from New York. In Secrets of Silicon Valley, entrepreneur and media commentator Deborah Perry Piscione takes us inside this vibrant ecosystem where meritocracy rules the day. She explores Silicon Valley's exceptionally risk-tolerant culture, and why it thrives despite the many laws that make California one of the worst states in the union for business. Drawing on interviews with investors, entrepreneurs, and community leaders, as well as a host of case studies from Google to Paypal, Piscione argues that Silicon Valley's unique culture is the best hope for the future of American prosperity and the global business community and offers lessons from the Valley to inspire reform in other communities and industries, from Washington, DC to Wall Street.

Product Details

ISBN-13: 9781137324214
Publisher: St. Martin''s Publishing Group
Publication date: 04/02/2013
Sold by: Macmillan
Format: NOOK Book
Pages: 256
File size: 2 MB

About the Author

Deborah Perry Piscione is CEO of Alley to the Valley, an organization that networks the world's most influential women for dealmaking, and Betty onfidential. She is also a commentator on CNN and NPR, and has appeared as a guest on the Today show, Wolf Blitzer Reports, The O'Reilly Factor, Hardball with Chris Matthews, and Politically Incorrect, and has been a featured guest on PBS, BET, and NPR programs including The Tavis Smiley Show. Piscione has won numerous awards, including the 2009 Silicon Valley Women Business Owner of the Year, a Gracie Allen Award for her participation in a debate for NPR's Justice Talking, and a distinguished award from The White House Project. She has been featured in leading women's magazines such as Ladies' Home Journal, and in newspapers including The New York Times, Chicago Tribune, and Dallas Morning News. She lives in Silicon Valley, California.
Deborah Perry Piscione, author of the New York Times bestselling book Secrets of Silicon Valley is an Internet entrepreneur, advisor, and management consultant who works with corporations around the world. A former congressional and White House staffer, she spent over a decade as a media commentator on CNN, CNBC, MSNBC, ABC, NBC, Fox News, PBS, and NPR programs, and her work has been covered in The New York Times, The Wall Street Journal, The Economist, and Forbes. She lives in Los Altos Hills, California.

Read an Excerpt

Secrets of Silicon Valley

What Everyone Else Can Learn From the Innovation Capital of the World


By Deborah Perry Piscione

Palgrave Macmillan

Copyright © 2013 Deborah Perry Piscione
All rights reserved.
ISBN: 978-1-137-32421-4



CHAPTER 1

WHY YOU SHOULD CARE ABOUT SILICON VALLEY


Singularity University (SU) occupies a few former military barracks on the campus of NASA-Ames Research Center at Moffett Field, halfway between the cities of Mountain View and Sunnyvale, California. When entering Moffett Field past the guarded gate, you feel as if you have left Silicon Valley far behind, with the only exception being the ubiquitous Spanish-tiled roofs that adorn the main buildings. The old, musty smell of a prewar establishment greets you as you walk through the front doors of Singularity's main office. But beyond the aroma, there is nothing stagnant or backward about this place. The concepts being taught here are futuristic, evolving, and accelerating technologies: robotics, artificial intelligence, nanotechnology, biotech, design theory, space exploration, and other Jetsons-like ideas that are headed our way. Singularity University's overarching purpose is to forecast, analyze, and create the science and technology that will define our world five to ten years into the future. Some of the world's most brilliant scientific minds have gathered to collaborate on a single mission: to solve the world's biggest challenges, impacting one billion people at a time.

Why did the founders of this unique program use the term "singularity"? In its simplest definition, singularity is "the hypothetical future emergence of greater-than-human superintelligence through technological means." It stems from the idea of a possible future emergence of a greater-than-human intellect through means such as biological enhancement of our bodies and minds, the meshing of humans and computers, and even artificial intelligence — events that would thrust humanity into a new world of technological change. If this concept sounds far-fetched, consider this quote from SU cofounder, famed inventor, and futurist Ray Kurzweil:

The whole twentieth century was actually not one hundred years of progress at today's rate of progress. It was twenty years of progress at today's rate of progress. And we'll make another twenty years of progress at today's rate of progress, equivalent to the whole twentieth century, which was no slouch for change, in another fourteen years. And then we'll do it again in seven years. That pace will continue to accelerate, and because of the explosive nature of exponential growth, the twenty-first century will be equivalent to twenty thousand years of progress at today's rate of progress; about one thousand times greater than the twentieth century.


In our age of ever-increasing complexity, previously unimagined possibilities are becoming reality with greater rapidity. And it is this rate of change that keeps Dr. Peter Diamandis, the co-founder, chairman, and the driving force behind Singularity University, up at night. The dynamic and optimistic Diamandis unapologetically dares to dream big. In 1987 — 88, he founded the International Space University in Strasbourg, France, with the idea of finding the smartest people on the planet and putting them in a room together to work on big, audacious goals. "It was a ton of fun," says Diamandis. Holding degrees in molecular biology and aerospace engineering from MIT as well as a medical degree from Harvard, and founding and acting as CEO of the X Prize, an educational nonprofit that offers incentivized prize competitions to solve radical breakthroughs for the benefit of humanity, Diamandis is someone who has the fortitude to predict the emergence of and intersection amid science and technology.

Diamandis was inspired to start Singularity University while trekking through Patagonia with his wife, Kristen. He couldn't stop thinking about Ray Kurzweil's book, The Singularity is Near, which he had lugged along on the trip. "The book was the heaviest thing in my backpack," says Diamandis. "I had followed Ray's work, but purposely put off reading his book for a few months. I knew once I read it, I was going to jump in hook and sinker." The book not only defined the characteristics and impact of the coming singularity, but also described the landscape wherein our "intelligence will become increasingly non-biological and trillions of times more powerful than it is today — the dawning of a new civilization that will enable us to transcend our biological limitations and amplify our creativity."

After returning from his travels in South America, Diamandis couldn't wait to connect with Kurzweil and immediately set up a strategic dinner engagement to meet him for the first time. The two men met in Orange County, California, and Diamandis pitched Kurzweil on how the two could collaborate on his vision. Kurzweil was intrigued. These are two of the world's great futuristic thinkers who act on their passions, but it was Diamandis who insisted that there should be a place where the greatest scientific and technological minds from various domains should converge to tackle the world's most pressing problems — those brilliant minds who have the potential to alter the human experience and life on Earth as we know it. During an early planning meeting for Singularity University, an executive education program rather than a traditional four-year degree, they identified dozens of people who shared their fervor and invited them to convene at Moffett Field. The "who's who" of guests included Google co-founder and CEO Larry Page, who was so convinced of the need for Singularity University that Google became the first sponsor, and in February 2009 Diamandis and Kurzweil held a press conference at the annual TED (Technology, Entertainment, and Design) conference and announced the birth of Singularity University.

While Diamandis strives to keep his finger on the pulse of accelerating technologies, Kurzweil likes to promote the potential of taking exponential steps, rather than viewing life as linear. He notes that if you take 30 linear steps forward, you will get exactly 30 steps as your outcome. However, if you take 30 exponential steps forward, your outcome will be a billion steps. They feel humanity will need to embody this exponential growth to overcome life's grand challenges in eight critical areas, which Singularity University has adopted as its chosen disciplines: education, energy, environment, food, global health, poverty, security, and water. They ask one simple question of anyone who attends their executive or graduate studies programs: "What will you do to affect one billion people at a time?"


EXPONENTIAL CHANGES

Only in Silicon Valley is the culture of science and innovation given such free reign that people can study and experiment with these ideas despite the fact that the payoff may be years or decades down the road, financially or otherwise. But what makes this epoch even more significant than any prior era of change in human history is how enormously Silicon Valley technologies impact the world's most basic ideas about work, learning, and lifestyles. These technologies will allow anyone — at any age, anytime, and anywhere in the world — to enter the entrepreneurial marketplace, create a personal brand or platform, and build things that were only recently considered very capital intensive. Take, for example, then-15-year-old Jack Andraka, a high-school freshman from Maryland who invented a viable early prevention test for pancreatic cancer.

Andraka, who was inspired to find a cure after his uncle died of pancreatic cancer, was mostly rebuffed by the medical establishment, likely due to his young age, but he remained undeterred. Using carbon nanotubes, he ran a series of experiments to test the electrical conductivity between them at various distances. Andraka then wanted to share his findings with the medical establishment, but received 197 rejection letters from notable doctors. However, Dr. Anirban Maitra, professor of Pathology, Oncology, and Chemical and Biomolecular Engineering at Johns Hopkins School of Medicine, wanted to see what this young pioneer had discovered, and invited Andraka to spend time in his lab. There the teen scientist found that when the antibodies on the surface of the nanotubes came into contact with a target protein, the protein bound to the tubes and spread them apart. Andraka's testing determined obvious changes in the electrical conductivity of the nanotubes when the distances between the charges changed. That shift in the spaces between tubes can be detected by an electrical meter. Andraka used a $50 meter from the Home Depot to do the trick. Now, Andraka believes that this same dipstick sensor could be used to detect ovarian and lung cancers as well. According to Andraka, his diagnostic test is 28 times faster, 28 times less expensive (costing around three cents), and over 100 times more sensitive than the current methods. In 2012, Jack Andraka won the Intel International Science and Engineering Fair grand prize of $75,000 and, after winning, patented his sensor.

Entrepreneurship is the future of the world, as anyone can partake. We're just beginning a global startup revolution in talent development and idea creation, a movement so widespread that it could redefine the foundational concept of business and work in the twenty-first century. Don't believe it? Consider the culmination of these three factors, which will greatly enhance the probability of instantaneously commercializing any idea:

1. Technology is faster, available to everyone, and accelerating toward microscopic and free;

2. Outsourcing, crowd-sourcing, and P2P (person-to-person) collaboration make us more efficient at little to no cost; and

3. Social media is completely redefining how we communicate with one another, work across domains and boundaries, and market our ideas.


Gordon Moore, an Intel co-founder, popularized the phrase "Moore's Law," a concept that soon became the foundation for the exponential revolution, in a 1965 paper. Simply, Moore's Law characterized the "history of computing hardware whereby the number of transistors that can be placed inexpensively on an integrated circuit doubles approximately every two years." Since then, Moore's Law has been uncannily accurate in predicting the growth of technology and its declining costs. While the specifics of Moore's Law have shifted slightly over the decades, it has been universally recognized in nearly every segment of the global technology marketplace as affecting processing speed, memory capability, sensors, semiconductors, and even the number and size of pixels in a digital camera. Over time, technology indeed becomes exponentially better, stronger, faster, and more financially accessible to the masses.

In his book Abundance, Dr. Peter Diamandis observes: "[F]olks with no education and little to eat have gained access to cellular connectivity unheard of just thirty years ago." This technological emergence has staggering implications, as Diamandis illustrates in relation to the common man: "[I]f he is on a smart phone with access to Google, then he has better access to information than the president of the United States did 25 years ago." As a matter of fact, physicist Michio Kaku has noted that today's average cell phone has more computing power than all of NASA did when it sent two astronauts to the moon. With that level of technology available to every citizen in every country, what sort of new markets, new economies, and new innovations can we expect? In 2000, only 2 percent of Africans had access to a cell phone. In 2009, that number grew to 28 percent, and is expected to swell to 70 percent in 2013. This rapid expansion of mobile technology in the sub-Saharan region is already giving birth to an economic revolution that will be exported to the rest of the world — a prime example of what might be called "reverse innovation," where the innovation is first seen in the developing world before spreading to the industrialized world. Carol Realini, the executive chairman of California-based mobile-banking innovator Obopay puts it this way: "Africa is the Silicon Valley of banking. The future of banking is being defined here. The new models for what will be mainstream throughout the world are being incubated here. It's going to change the world."

David Rose, an entrepreneur and investor who is credited with bringing "Silicon Alley" to New York, gave a talk at SU on how the rapid "acceleration to free" will change the financial implication of the way business is conducted and who can enter today's marketplace. Now anyone can create a sustainable small business practically for free, and grow it into a dynamic and potentially game-changing enterprise in very little time. Peter Diamandis once told me that individuals with a small cadre of experts who are connected via shared passions and the internet can now do what only large corporations and governments were able to do in the past. They can advertise for no cost via social media; offer "freemiums" (services and experiences that the consumer gets for free, but will subsequently be charged for once the consumer is hooked); cross-subsidize; do a labor exchange; or offer virtual goods, all at zero marginal cost.

Web 2.0, the mid-2000s evolution of web capabilities like information sharing, collaboration, and user-generated design, brings us real-time information, allowing us to not only find and sample whatever we want whenever we want it, but also to outsource and crowd-source. Outsourcing means that we can allocate specific tasks at which we are less proficient to outside experts or "freelancers," making us more efficient in our areas of expertise. Today, we can also leverage the knowledge and power of the "crowd" through the internet, harvesting the best talent available to design business cards, create logos, develop marketing plans, mock up websites, or code apps. Crowd-sourcing offers a plethora of choices, allowing us to pay what we want to access an unprecedented range of expertise in design, services, ideas, business development, or technology.

Social media, which dominates much of our time on the internet, couples real-time information with the acceleration-to-free concept. This tool has made us simultaneously more connected to our past, present, and future than at any time in human history, and gives us access to others with whom we may have wanted to associate but lacked the real-world connection to meet under normal circumstances. Sites such as Facebook, Twitter, and LinkedIn have forever changed the way we interact, both personally and professionally. We can reach anyone at any time, allowing us to work in collaboration with others who can help build on our ideas, contribute their own opinions, or popularize a concept virally without any formal agreement or campaign. Through social media, individuals develop a social graph that can be leveraged to create more overall well-being than ever before.


The Power of Social Media

A musician by the name of Dave Carroll got frustrated after nine months of unsuccessfully trying to get United Airlines to reimburse him for his treasured Taylor guitar after it was damaged by baggage handlers. Carroll wrote and produced a catchy tune about the whole experience and posted it on YouTube. As of the writing of this book, the video has received over 12 million views. While United still refused to take responsibility, Taylor Guitars sent Carroll two new instruments as gratitude for all the free publicity they received. As a side note, Carroll was also able to launch a speaking tour based solely on his song, "United Breaks Guitars."

You could argue that Al Jazeera, the Qatar-based news network, may have been the trigger of the "Arab Spring," the revolutionary wave of protests in the Arab world that began on December 18, 2010, but it was Facebook and Twitter that galvanized people to the streets. The grassroots demonstrations that began in Tunisia and Egypt and consequently rippled through much of the Middle East enabled civilians to launch coups against authoritarian governments. No longer must disenfranchised or oppressed citizens go underground or flee to the jungle in order to create a revolutionary movement. Could it be that social media has enabled more democracy movements over the course of a year than our entire foreign aid program has since being signed into law by President Gerald Ford in 1974?

The Arab Spring leaves little doubt that social media can have a groundbreaking effect on arenas as large as geopolitics, and ranking politicians are rethinking and revamping our current foreign aid program.

Frank Spencer is a professional futurist — one of a handful of scientists who attempt to systematically predict the future. He's also co-founder of the innovation firm Kedge. In a series of conversations with him, I saw how convincingly he believes that social media is bringing people together based on common protests or passions, and is even causing us to move away from traditional models of generational segmenting, allowing individuals and groups to coalesce around cohorts based on similar interests, projects, and democracy movements. Spencer has often shared the idea that social media, as a tool, allows us to share knowledge and create communities that are conducive to large-scale inspiration, innovation, and invention. All of this will impact the way we live and work, transfer more power to more people, and provide accessibility to information like we have never seen before. But what makes this shift even more unprecedented is that we are experiencing a simultaneous cultural values shift.


(Continues...)

Excerpted from Secrets of Silicon Valley by Deborah Perry Piscione. Copyright © 2013 Deborah Perry Piscione. Excerpted by permission of Palgrave Macmillan.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

Table of Contents

Table of Contents
Introduction: An East Coaster Goes West
Chapter 1: Why You Should Care about Silicon Valley
Chapter 2: Why Silicon Valley Exists
Chapter 3: Ecosystem and Culture
Chapter 4: The University—Stanford
Chapter 5: A Population of Highly Motivated People
Chapter 6: The Cycle of Innovation
Chapter 7: The Unique Profile of the Silicon Valley Entrepreneur
Chapter 8: What Makes Silicon Valley Business Model Different

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