Entrepreneurial Growth Companies

1
Entrepreneurial Growth Companies Regions The
Role of Culture

• Patrick Von Bargen
• Executive Director
• November 17, 2000

2
Regions Culture

• Critical because regions (distance) matter
• Saxenian Tale of Two Cities
• Route 128 (dispersed) vs. Silicon Valley (dense)
• Critical because culture matters
• Difference in performance NOT due to taxes, cost
  of real estate, cost of wages, etc. It was the
  character of the industrial systems of each
  region, or their regional cultures.

3
A Critical Mass of Regional Resources

• Financial Capital (friends, family, angels, seed
  funds, VCs)
• Human Capital (managers, technical, skilled
  workforce
• Technology (R D at other companies,
  universities, labs)
• Suppliers Customers (industrial, technical,
  professional)
• Infrastructure (transport, communications,
  amenities, environment, education)

4
Elements of Regional Culture

• History Current Culture. Region has leaders, a
  vision of itself, ancestral companies, heroes
  role models, and values. Compatible with
  entrepreneurial culture?
• Little history Silicon Valley
• Lots of history Pittsburgh, Nor. Virginia
• Obvious opportunity to change the current
  culture Austin

5
Elements of Regional Culture

• The Importance of Leaders. Private sector,
  public sector, university sector, non-profit
  sector.
• Fred Terman, David Packard, and Bill Hewlett and
  Silicon Valley
• George Kozmetsky, Mark White, and Pike Powers
  and Austin
• Mario Morino and Others in Nor. Virginia

6
Elements of Regional Culture

• Vision of the Region. What is the story? What
  are all the entrepreneurs,venture capitalists,
  supplier companies, universities, etc. trying to
  accomplish here, in this region?
• Silicon Valleys vision
• Austins vision
• Northern Virginias vision

7
Elements of Regional Culture

• Ancestor Companies, Heroes, and Emerging Role
  Models. Remind everyone that it can be done
  here, in this region, and if he or she can do
  it, why cant I?
• Silicon Valley, Fairchild, Intel, then Jobs
• San Diego, Irwin Jacobsen, Bob Beyster
• Austin, Tracor, Kozmetsky, Dell
• Boston?

8
Elements of Regional Culture

• Vibrant Networks. THE critical institution in
  regional industrial systems.
• They connect all of the regional resources
  listed above with each other and with
  entrepreneurs
• They engender collaboration and cooperation among
  all the regional resources
• They give entrepreneurs real-time information on
  money, people, technology developments, market
  developments, and job opportunities
• They transmit the values of the culture

9
Elements of Regional Culture

• Vibrant Networks. THE critical institution in
  regional industrial systems.
• Homebrew Computer Club in Silicon Valley, the
  Wagon Wheel and other watering holes
• Netpreneur in Northern Virginia
• CED in Research Triangle Park
• IC2 in Austin
• VC networks and zaibatsu in SV

10
Elements of Regional Culture

• Values What is honored, rewarded?
• Cooperation competition vs. competition
• Collaboration interdependence vs. independent
  and even antagonistic action
• Start-up vs. climbing the corporate ladder
• Building companies vs. making money
• Spinning off or out vs. staying w/ employer
• Loyalty to the networks vs. loyalty to employer

11
Elements of Regional Culture

• More Values Choices
• Change adaptation vs. stability consistency
• Openness sharing info vs. secrecy
• Risk-taking honor and learning in failure vs.
  risk-avoidance stigma for
  failure
• Speed vs. deliberation
• Democracy networks vs. hierarchy

12
Regional Role Policy and Leadership?

• Identifying and supporting the core group of
  leaders
• Primary Role catalyzing the development of
  networks
• coordinating -- not managing -- relations of all
  the actors in a regional economy
• ECGS, larger companies, smaller supplying
  companies, business associations, universities
  and colleges, local government

13
Regional Role Policy and Leadership?

• Spreading the Stories of
• The old economy culture and history
• How visionary leaders have put the region on an
  entrepreneurial course
• The ancestry of ECGs
• The historical and current role models
• The current and future vision of what were doing
  here and why
• Even small victories of the new values

14
Regional Role Policy and Leadership?

• Tools for Telling the Stories
• The local press can play a huge role
• Boston Globe vs. San Jose Mercury and Puget Sound
  Business Journal
• Events, awards, role of public officials
• Network events, communications