Sunday, March 01, 2009

Silicon Valley vs. Silicon Valley North

I got back from a business trip to California yesterday. I came in on the red-eye and so I'm pretty wiped out.

While there I got a bit of insight as to why the Valley is different, though technically I was in Telecom Valley rather than Silicon Valley. Anyway, there are tons of people there who not only use the latest technology, but are immersed in it. It is part of their everyday lives, and they are aware of the new innovations coming down the pipe, and innovation flows from this. They own/use what is currently the latest state of the art, they have friends working on the next state of the art, and they are developing synthesized ideas about what the third generation state of the art will be.

Ottawa, sometimes referred to as Silicon Valley North, has a lot of talented developers, but we don't seem to have this level of innovation happening on a wide scale. Some innovation, but not as much as the Valley.

The obvious answer is for people in Ottawa to start buying more state of the art toys. So, I'm off to Future Ship... 8-)


Anonymous jgriffin said...

I disagree on three points. First, a great deal of innovation is happening in Ottawa on an ongoing basis. I personally know of several startups that went from theoretical to shipping in the past year. Second, the latest toys are not what is needed to drive innovation unless you are equating minor improvements on existing technology as innovation. Third, Future Shop is not where you go for state of the art toys. All that tech is at least three months old :)

On a more serious note, I think the reason Ottawa does not appear like a real innovation player is because the innovators are bought out just as their products go to market. Of the companies I previously mentioned I know that one has already been sold by angels to American investors who have moved the technology south and a second is in the precess of being sold on the basis of their patents.

If Ottawa really wants to hold the title Silicon Valley North it must start finding investors who are willing to keep promising technology in the valley and not sell out at the first offer that meets the short term goals set out in their spreadsheets.

8:55 p.m.  
Blogger Shawn Abigail said...

Thanks for the comment John.

I wasn't saying that there isn't any innovation happening. But it seems that in Ottawa it is an occasional thing, while in the Valley it is everywhere. I think most developers in Ottawa want a paycheque, while many many more in the Valley want a chance to do their own start-up.

And yes, the lack of investment is an issue. With proper investment, in 5 years we could have a major shift here in Ottawa, and I would guess another 10,000 hi-tech jobs. Without the investment, and with a short term "what's my exit strategy" mentality, our innovation will be sold to the US for cheap.

9:25 p.m.  
Anonymous jgriffin said...

I would argue that innovation is happening all around us, but it is happening in an innovative way. You will not find many hi-tech incubation centres or buildings with multiple small companies around here. Ottawa innovators don't have access to enough capital to rent office space so they innovate either gathered in their homes or remotely. Projects are managed as if the teams were geographically dispersed, something we are well versed in, with people communicating via E-Mail, phone or IM.

Ottawa developers also tend to innovate on the cheap. Open Source is a big around here. There are a large number small organizations using a LAMP stack for Web development or GNU C/C++ on a Linux micro-kernel for product development. In the past year I have seen two start-ups pick game-boys for their target platform because they are cheaper then cell phones or netbooks.

Again, having a sample size of one is not a good indicator but my experience suggests that innovation is happening, just not out in the opening.

The other reason you may not see innovation happening in Ottawa is because the turn around time from concept to sell-out is generally about a year. That leaves very little time for overlap. So in Ottawa 100 companies over 5 years averages out to 20 active companies per year. In Silicon Valley 100 companies over 5 years averages out to between 40 - 60 per year.

Another thing, since I am in full rant, is that the get almost-rich-quick mentality of investors up here means that Ottawa will hit home runs by accident rather than by design. If you don't keep your companies around long enough to be profitable you won't get the big reward at the end. I liken the whole thing to selling raw logs rather than milled lumber. You get your money quicker but you get less of it and fewer people benefit along the way.

11:05 p.m.  

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