The History and Key Components of Silicon Valley
The history of Silicon Valley may be traced back to the founding of Shockley Semiconductor in 1956. However, the beginning of the modern Silicon Valley probably started with the founding of Hewlett-Packard. in 1971, Dan Hoefler used the term Silicon Valley in his series of works to describe a region full of high technology and semiconductors ( which are made from silicon). By 1975, Silicon Valley had become a generally accepted concept (Kenney, 2000, pp.3-4).A number of extremely famous companies are based in Silicon Valley, including Apple, Adobe, Alphabet Inc.( which is the holding company of Google), Cisco, eBay, Intel, and Mata.
What are unicorns and black swans?
In the context of this article, unicorns can be understood as private companies valued at more than $1bn. There are many unicorn companies in silicon valley. Only in 2014, over $66.5bn of venture capital was poured into technology businesses, leading to the emergence of over 60 unicorns (Tett, 2015).
This video has explained the black swan theory. To be more accurate, according to Taleb (2007), to describe something as a black swan, it needs to have three key components.
- This is an unpredictable event
- This event should have a huge impact on the world
- People tend to explain the reason why it would happen. They try to convince others that it is not a random event and it could be predicted.
The 911 incident and the success of Google, in the opinion of Taleb (2007), could be considered the black swan.
The shape of Silicon Valley nowadays is not entirely due to the direct influence of politics and policy. Still, there are strong indications that the growth of Silicon Valley is inextricably linked to government investment in infrastructure. The government has invested funds in the Silicon Valley area to build infrastructure projects such as highways and universities that have made living conditions in Silicon Valley convenient and wonderful. The completion of these infrastructure projects has had a hugely beneficial impact on Silicon Valley’s industrial development. The completion of the highways has made Silicon Valley more accessible to the outside world, and the investment in universities has given Silicon Valley a distinctive pool of highly educated local talent (Barbrook & Cameron, 1996).
Another point is that the Silicon Valley model of the Internet is the Open Internet, which is technology-based, portable/extensible, and open and transparent. (O’Hara & Hall, 2018). The Silicon Valley model of the Internet is the Open Internet, which is technology-based, portable/extensible, and open and transparent (O’Hara & Hall, 2018). The Silicon Valley model is primarily regulated by technology rather than the government, allowing people to choose appropriate platforms to express themselves in a way that corresponds to acceptable content, reducing government participation in the process. While this model is both straightforward and convenient, the lack of a consistent regulatory approach poses a significant challenge to online safety and harmony.
The core spirit of Silicon Valley is spontaneous and adventurous. Venture capital investment has been extremely important to the high-tech start-ups in Silicon Valley. As the most concentrated location for startups in the world, 51% of venture capital from the US is invested in Silicon Valley startups each year, creating a number of world-renowned startups as a result (Ester & Mass, 2016). However, this does not mean that Silicon Valley startups always have an advantage in raising capital; precisely because such a vast number of venture capital is invested in the Silicon Valley region each year, startups become more predisposed towards the Silicon Valley region as a place to compete for venture capital, with the total demand for thousands of companies far outweighing the offer (Ester & Mass, 2016).
The allocation of wealth in Silicon Valley presents an extreme imbalance that should be redistributed if the long-term interests of the majority are considered. However, this goes against the short-term interests of those who currently hold large amounts of capital. The majority of this group in Silicon Valley tends to be the whites. While poor minorities are often only able to stay in Silicon Valley by providing cheap, non-technical labour to Silicon Valley technology companies. (Barbrook & Cameron, 1996).
On one side, massive amounts of ghost workers are being paid less than the legal minimum for traditional work, have no access to various social benefits, might be fired at any time, or do not have any employment contracts at all. They often carry out technology-related but tedious and repetitive work, such as training AI through manual image recognition. This group is enormous yet almost invisible to mainstream society and almost invisible in society (Gray & Suri, 2019). On the flip side, more tech workers are choosing to move into Silicon Valley, leaving the other workers who were already based in Silicon Valley to relocate outside of it and thus have to make long commutes (Lusoli & Turner, 2021).
In the 1960s, the hippie movement had a significant cultural impact in the Bay Area and influenced the entrepreneurial culture of Silicon Valley. The philosophy of non-conformity, the critique of tradition and authority, and the emphasis on the importance of sharing and openness in the hippie community significantly impacted the subsequent culture of Silicon Valley (Ester & Mass, 2016).
Silicon Valley has built a solid reputation for innovation over the past 50 years, leading the world in bringing about fundamental technological change with the emergence of social innovations in talent retention, such as employee stock options and profit sharing, and an emphasis on flat organisations, teamwork and elite business culture. A mature ecosystem and culture have been built up over more than half a century and have shown a fantastic ability to reinvent themselves (Ester & Mass, 2016).
The culture of Silicon Valley is well documented. The enormous amount of governmental and economic support has turned Silicon Valley into a hotbed for start-ups, making the emergence of unicorns commonplace in the area. At the same time, discipline and stability within Silicon Valley are somewhat precarious due to the highly competitive and exclusionary nature of the region, resulting in frequent black swans. Despite this, one should admit that the culture and unique characteristics of Silicon Valley enable the rapid iteration and development of technology to facilitate the development of human life. Regardless, finding a balance among developments is always an essential topic.
Barbrook, R., & Cameron, A. (1996). The Californian ideology. Science as Culture, 6(1), 44–72. https://doi.org/10.1080/09505439609526455
Ester, P., & Mass, A. (2016). Silicon Valley, Planet Startup. Disruptive Innovation, Passionate Entrepreneurship and Hightech Startups. Amsterdam University Press. http://www.jstor.org.ezproxy.library.sydney.edu.au/stable/j.ctt1zxxxjg
Gray, M. L., & Suri, S. (2019). Ghost Work: How to Stop Silicon Valley from Building a New Global Underclass. HarperCollins Publishers.
Kenney, M. (2000). Understanding Silicon Valley: the anatomy of an entrepreneurial region. Stanford University Press.
Lusoli, A., & Turner, F. (2021). “It is an Ongoing Bromance”: Counterculture and Cyberculture in Silicon Valley—An Interview with Fred Turner. Journal of Management Inquiry, 30(2), 235–242. https://doi.org/10.1177/1056492620941075
O’Hara, K., & Hall, W. (2018). Four Internets: The Geopolitics of Digital Governance (No. 206) Centre for International Governance Innovation. https://www.cigionline.org/publications/four-internets-geopolitics-digital-governance/
Taleb, N. N. (2007). The black swan: the impact of the highly improbable (1st ed. ed.). Random House.
Tett, G. (2015). The legend of the Silicon Valley unicorns. FT.com. https://www-proquest-com.ezproxy.library.sydney.edu.au/docview/1667194800?parentSessionId=O8Y6l0613Sp88QTS7NhiEOGkjbhCiqOZdKZ9ichAPjw%3D&pq-origsite=primo&accountid=14757#