Why Now is the Time to Invest Heavily in a Tech Innovation and Entrepreneur Ecosystem (TIEE).
May 8, 2020
Silicon Valley was triggered by a US Government initiative back in the 1950s. Government contracts were the catalyst for what is now the preeminent technology innovation and entrepreneur ecosystem in the world.
It has taken 70 years to build Silicon Valley to where it is today, but the very nature of tech, its exponential path explained in Moore’s Law, means that it could be replicated in a fraction of the time and a fraction of the cost.
For any nation thinking they are too late to get started, think again. We are still in the first innings of the tech revolution and the high unemployment global recession triggered by COVID-19 is about to generate, through necessity, the most entrepreneurs the world has ever seen.
I am not here to debate how bad the coming recession is going to be or how long it is going to last, but I do believe that most governments are going to have to step in and help on an enormous scale. “Give a man a fish and you feed him for a day, teach him to fish and you feed him for a lifetime.” Governments must encourage more entrepreneurs.
Unfortunately, I fear there will be people who are now unemployed for life. Their former industries will never return to where they were before COVID-19. With the right encouragement, many of the people can and will become entrepreneurs. Never underestimate entrepreneurs’ abilities to discover a need and provide a solution. Technology is the new farm, the new factory. It is the revolution of our generation and it can and will support and provide for all of us.
I don’t believe any government anywhere in the world has a legitimate excuse for NOT building a Tech Ecosystem. And I have to question, even the nations that are making a start, why are they doing so little?
If you assess the core functions of government: food, healthcare, education, security, productivity, and most importantly, jobs, these are all going to be enormously affected by technology over the coming decades. In fact, excelling at any of these and not excelling at tech is almost impossible.
Gone are the oil, finance, agriculture, and manufacturing businesses of the past. I believe “TIEE” is already one of the world’s most valuable “natural resources.” If you look at the world’s top 10 companies by market cap, there is a theme: tech companies dominate the top spots (Q1 2020).
- Berkshire Hathaway
- Johnson & Johnson
The beautiful thing about TIEE is that every nation can produce it and it has enormous compounding effects. With the right incentives, successful exits invest back into the next generation of entrepreneurs.
The good news for any country, region, or city is that very few competitors have much of a head start and I believe most are woefully undervaluing the rewards.
Having studied and lived in Silicon Valley for the past decade, I believe the core constituents for success are relatively straightforward from a geographical focus, tax incentives, university adoption, etc. The hardest component is simply political will.
Governments are about to spend billions on helping the here and now, I hope many will use some of that money to invest in TIEE and insure a long time successful future.
Next up, 10 key steps to build a successful TIEE.
Duncan Logan is the Chief Strategy Officer at Nex Cubed.