Why is Silicon Valley Attractive to Startups?

Why most tech entrepreneurs aspire to be in Silicon Valley? It does not mean there are no other successful technology hubs elsewhere. Globally, places like Tel Aviv, London, Singapore, Berlin, Toronto, Bengaluru, Stockholm, Beijing, South Korea, Moscow, and many others promote technology hubs. I will focus on Silicon Valley because it is where my experience is grounded. California has over $3 trillion GDP, the highest in the United States, and if it was a sovereign country, it would rank in the top 10 globally.

Silicon Valley has created an ecosystem that is very difficult to copy in its original form because of the unique culture of innovation and entrepreneurship. It has business-friendly laws, a strong economy, easy access to pitching and networking events, availability of highly sought talent pool, collaboration culture for entrepreneurs, access to research, prominent academic institutions, etc. Many entrepreneurs in Silicon Valley focus on solving global problems affecting humanity; therefore, scope and scale are the most fundamental ingredients. This business friendly approach attracts venture capitalists, angel funders, private equity, and investment banks targeting high growth markets and unicorns. The focus on customer pain point creates a positive multiplier effect which benefits emerging and developed markets.

According to Klaus Schwab, “The second industrial revolution has yet to be fully experienced by the 17% of the world as nearly 1.3 billion people still lack access to electricity.” The quote invites many entrepreneurs to be more innovative in solving global human challenges. To advance the UN Sustainability Development Goals, I call upon governments to invest in technology and research, promote entrepreneurship, and emulate the lessons from Silicon Valley. In my view, each country must have its own Silicon Valley.