Day 3: Stanford, Cisco and VC demo
A critical piece of the silicon valley puzzle is Stanford University, and an important part of the Stanford magic is Sillicon Valley. It was therefore fitting that we started our 3rd and final day in the valley at Stanford, with a talk from Adjacent Professor Mike Lyons about the origin of the ecosystem there and how Stanford plays an important part in supporting entrepreneurs.
We were provided insight into how the birth of a place like the valley requires government support without a requirement for commercialization or profit, with an emphasis on creativity and freedom of venture as a key success criteria. As companies came and went in the valley, it was not always about the latest technology. In many cases it was about infrastructure readiness, the latest trends and consumer’s trust in the solution. Uber for example was made possible by the widespread advent of mobile phones, and a willingness of consumers to pick up on the “sharing economy” trend and trust other strangers. This was an important lesson in technology, perhaps complementary of what we discovered at Apple; technology merely enables new ideas rather than creates them. There is therefore no substitute to understanding the true pain points of consumers and the context around which they operate, and then trying to envision how technology can help them.
Our company tour ended at Cisco, where we were given a detailed insight into the company’s Corporate Strategy Office and its Cisco Investment arm.
How do you create an agile “startup” within a giant company and task it with keeping the rest of the company’s strategy in check in the face of massive technology disruption? How do you make decisions of whether to build new technologies, invest in other start-ups, partner with external companies, or buy other companies? How will the advent of IoT impact the business and how is Cisco positioning itself in that space?
The answers to these questions were not obvious, but what was obvious was that Cisco strike an impressive balance between exploiting their existing businesses and exploring new ones. Getting an intimate look at how the company does this was incredibly insightful.
Our last stop in the valley was at a Venture Capital demo, where we had 4 companies at various seed funding stages present to us their products and solutions. Seeing and understanding the kind of money VCs are ready to invest in new ideas in these companies reiterated one thing; the next big idea is right around the corner, and the only way it’s going to become reality is when cash-rich visionaries invest serious amounts of money in ambitious entrepreneurs who have unparalleled belief in their products. Another key finding however was one about failure. The VCs and the entrepreneurs talked the valley’s attitude to failure, and how it was celebrated instead of being frowned upon. The few companies that are truly successful provide enormous returns to both investors and founders, therefore making the pain of failed startups a minor inconvenience.
If there was one takeaway from our experience in Sillicon Valley, it’s that there is no magic formula for why the place is so successful. But the drive and fire in the entrepreneurs’ eyes was unquestionable. The support systems, whether incubation or plentiful capital, and the urgency at which both VCs and the entrepreneurs function with was incredibly apparent. Embracing failure seemed like it was the spark that set off the entire valley, and this is perhaps what separates Silicon Valley from the other tech hubs of the world.