About a week ago I returned from a very intensive and inspirational trip to the USA. On Wednesday October 17, 2012, an economic mission organised by the Pomeranian region/Gdansk government traveled to the US for a 12 day visit including Silicon Valley, Seattle and Chicago. A group of 11 companies and representatives of the regional and local government went there to learn, be inspired and meet with potential VC’s and business partners. I went there out of curiosity, however also to be inspired, learn, meet & great people, and if possible to do business.
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Looking for the entrepreneurial spirit, failing is allowed, sharing a must
Being in the US for such a long time (and still too short), as expected, has been very inspiring. Among others we’ve learned that having an idea alone isn’t sufficient. It’s about the execution of the idea. We, Europeans, try to realize the best possible solution, whereas entrepreneurs in Silicon Valley are looking for a solution that serves particular customer’s need. Besides, it has to be a scalable solution. It’s a multi-billion dollar business that they are striving for.
Do you know Silicon Valley’s biggest secret? It’s the permission to fail! And since it’s easier to fail where no one knows you, Blackbox.vc founder Fadi Bishara advises entrepreneurs to leave their hometown and to relocate to a place where they don’t know you.
This Silicon Valley’s approach conflicts dramatically with the failure preventing business approach in Europe. We don’t want to fail,so we avoid taking the risk. They, on the other hand, want to win big, but taking the risk may make you fail dramatically. Apparently though, when you fail in Europe you’re a looser, however when you fail in the US they hope you’ve learned something out of it.
Embrace change, think big, take action, let yourself fail!, learn more. Adapt & take action again. That’s what Fadi calls entrepreneurship.
Ownership aligns long-term interest
A very important part of the entrepreneurship in Silicon Valley is the team around the idea. It’s probably the most important factor in the process of realizing the project. Thus, to keep the team well-focused, sharing in the success of the company is one of the key motivation incentive. People might even consider working for free if they will share, if they are being offered equity.
Even investors realize the importance of it and will never claim an indecent huge part of the company, which happens in Europe. They realize the team has to have the feeling that they can really profit. The investors understand that it’s better to have a smaller part of something that can become very huge, than to have a big stake in something that won’t develop at all.
Silicon Valley is not necessarily your Holy Grail
Upfront and during the mission I noticed many people believe Silicon Valley is the key to success, the holy grail. People believe the US-based VC’s are just waiting for the next great idea. After being there for several days I’m pretty much sure this won’t be the case for everyone. Many ideas won’t meet the Silicon Valley’s demands, like among others scalability. This doesn’t mean these are bad ideas. They probably just don’t match the global market approach, but you can still earn decent money on it.
Moving your business to Silicon Valley means that you will really have to focus on it for the upcoming 3-4 years. Within this time-frame you have to prepare yourself for a big sale or an IPO. Your baby has to become a grown-up in no time and you will have to let it go by then. Like your child who leaves the parental house. Not everybody will match this lifestyle. In case you’re looking for a better work/life balance, you might have to consider other destinations. As we found out, people in both Chicago and Seattle seem to be more quality of life focused than people in Silicon Valley. In Silicon Valley they claim work-life balance is a myth. What’s more, an entrepreneur’s stereotype of a person following his dreams is in fact not working.
European startups can count on local support
To support European startups to become successful in Silicon Valley, among others US Market Access, a non-profit business accelerator located in San José, and The Plug and Play Tech Center, headquartered in Sunnyvale California, offer their services. Plug and Play’s network consists in over 300 tech startups, 180 investors and a community of leading Universities and Corporate partners. Honestly, their offer was more impressive than what US MAC showed us before. Many startup companies are located here for about 3 months to get accustomed to Silicon Valley and to be introduced to Venture Capitals and/or potential business partners. Also the above mentioned Blackbox.vc has an attractive offer to European entrepreneurs who would like to experience Silicon Valley.
Who knows you?
Having a big vision requires getting a lot of help. It’s best to think first about the help you need, instead of thinking about investors. Everybody likes to help. Human beings are wired to help. It’s in our nature. Once the idea appears to be a good one, you will find investors on the way.
But finding help is not necessarily easy. We tend to help the people we know first. And therefore, the more people KNOW you, the more help you will get. It’s neither about what you know nor about who you know. It’s all about WHO KNOWS YOU. This makes meeting people and making sure they KNOW you the most important mission for an entrepreneur.
Pimping your LinkedIn profile before you visit the US is a must. Besides, LinkedIn appeared to be a very good medium to get in touch with people and to arrange some meetings during the mission. Better don’t be surprised if immediately after the meeting people want to link with you on Facebook. They don’t treat Facebook as a private thing any longer.
We managed to meet with a lot of people during business mixers, hoping they will know us by now. Business cards have been exchanged, business ideas were discussed, we got linked through LinkedIn and now the execution is up to us. Because it will be essential to make people will still know us in some period of time.
Big brands no longer necessarily cool
During our visit we were able to visit companies like Boeing, Facebook, Google, Intel and Microsoft. All in all very inspiring visits to companies who became or are becoming just “regular” corporate companies. No longer they are the cool startups that the entrepreneurs of the Silicon Valley are willing to work for. The majority of the early Facebook employees are expected to start a numerous variety of new startups as soon as they will be allowed to sell their shares. Being a part of a startup is cool, working for those big brands isn’t any longer.
For many of us, this sounds probably like a very luxurious situation they seem to have in Silicon Valley …..
Silicon Valley is hard to copy
I noticed many people would like to copy the Silicon Valley idea, the governmental representatives included. Our mission made it clear that this won’t be easy. Of course, it would be great to create a similar entrepreneurial environment in Poland, or more specifically in our Pomeranian region, but that’s not easy. Building such a community takes years and needs a lot of effort from entrepreneurs, investors and government.
Red Russak, founder & startup concierge of Startup Seattle, in a partnership with Startup Weekend, Microsoft BizSpark, TechStars & Founders Co-op, was probably the most inspiring guy we’ve met during our US Mission. He clearly stated that building an entrepreneurial community takes time. Efforts we could see at other incubators like SURF Incubator, an initiative by Seaton Gras, show how important the effort of individuals with a mission can be to get something started.
The inspiring company and incubator visits and meetings with many really interesting people were excellent food for thought. We learned Silicon Valley, Seattle and Chicago all have a lot to offer to entrepreneurs. Depending on your experience, ambitions and needs you will have to decide what location is best for you. For the fast growers Silicon Valley might be the right place, while Chicago could be the right jump board to the US for many startups, especially for startups with Polish roots. Creating our local Silicon Valley isn’t impossible, but won’t be an easy job. This takes time and dedication. Hopefully this mission was a seed planted that will bear rich fruit in the days to come. I’m really happy with the people we’ve met and I’m looking forward to our future cooperation, both locally in Gdansk/3City and in the US.
A more detailed overview of my experiences during this trip can be found under US Mission.
wow so much ground to cover here. I am exhausted just imagining what you were experiencing and thinking in just this part of your blog.
In grad school – so very long ago – in an entrepreneurial business class (which is now very outdated), the idea of failure was a big part of potential success. Some went so far as to say you cannot be successful unless you have tasted and experienced failure. And some of the statistics proved this out. I cannot recall the specifics but success came after 2-3 failures. Many never went for it after the first failure… so only the strongest and bravest kept going.
Google – as you know – has encouraged it’s employees to devout time to other ideas. The company routine culls through these and brings some to market. Others of course perish -but without any risk to the employee. Could you imagine this kind of culture in the auto industry, pharma, banking?
“…Europeans, try to realize the best possible solution, whereas
entrepreneurs in Silicon Valley are looking for a solution that serves
particular customer’s need.” Not sure I fully grasp what you are saying here – unless you are speaking about time from idea-to-market. US Based entrepreneurship runs at a fast pace.. an idea today that sounds great, may be a poor idea tomorrow. I have mentored entrepreneurs in that if you have an idea that YOU are passionate about – execute now. If you think it over, consider all the angles, get second and third opinions… it will be passe before you even start. Or a competitor may have had a similar idea and is light years ahead. Which gets back to failure… get your idea out there… fail, adjust, re-launch or… the new key word Pivot.
Teams – and networking. Everyone has ideas (I have many) but it takes others to help bring them out and give them life. and these others have to be those that have the right connections or have already walked your path. I attend some start up group meetings locally (NJ/NYC) and it is a lot about who you know – who you have talked to… who is on your team. I like this … because as a solo entrepreneur you only know so much, others helping you even at the risk of sharing the spoils means you have more hands to help motivate and drive you to success.
As for replicating the model – it might be best at a highly technical university location in your europe. The students there are or can be the entrepreneurs that build the region. Stamford and USC probably created Silicon Valley… the idea is to keep students in the area they went to college instead of taking their knowledge and skills elsewhere…
One last point – from all that i am hearing, due the economic situation in Calfornia – entrepreneurs are less likely tobe found in Silicon Valley… and more so in Chicago, NY (Silicon Alley) and San Antonio texas… among other places. SV still has the awe and history but it is not the only place for success…