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| Oct 08, 2009 1:36 am |
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re: Atlanta City can’t keep tech startups |
Thomas Holford
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John Stephen Veitch sayeth:
"City can’t keep tech startups
Atlanta Business Chronicle - by Urvaksh Karkaria Staff Writer"
. . .
"Instead of building great high-tech companies, Atlanta has become a feeder system for great high-tech companies in other states, Breznitz said. Atlanta is in danger of becoming a “huge incubation center and the success will be reaped by California and New York,” he said."
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Well, this may have been the way things USED to be, but now California has the same complaint as Atlanta and New Zealand: other venues more attractive to or supportive of technology businesses are kidnapping our emerging companies.
I can't say what Atlanta or New Zealand's problems are. But I think the problem in California was a certain cultural hubris that basically said "We're smarter, richer, and more sophisticed entrepreneurs because we invented and built the silicon chip industry. Therefore, we can just plug in a different technology module, turn the crank, and dominate any other emerging technology business."
The flaw in that logic is that technology, business, and finance are ultimately highly mobile, and the California's success in silicon chips was a lucky accident as much as it was clever technological entrepreneurship.
A great deal of the hubris also infected the political class like a bad chest cold, and the politicians visualized the technology industry as a golden goose on steroids that would fund every pipe dream that any politician ever had.
Politicians could not resist the temptation to help entrepreneurs "manage" their bonanza and imposed "helpful" solutions like Sarbanes Oxley to make the industry less risky and more accountable for investors. They also poured tons of money into initiatives to keep the technology "advancing" when the key technological advances had long since been achieved, and the real technological innovation was shifting to other areas.
I worked with startup companies in Silicon Valley and saw first hand the unrealistic expectations of venture capitalists, the naivete of technology entrepreneurs, and the shallow grandstanding of politicians. Silicon Valley was created by a handful of hardworking, motivated, talented, visionaries. It's a delicate, fragile formula, and too much help of the wrong kind or with the wrong motivations can spoil the recipe.
One entrepreneur I worked with was engaged in the eternal struggle to raise funding to keep his promising technology company on track. Venture capitalists would offer him investment capital for an obscene price if he could show a history of three years of profitability. The Chinese offered him free rent and free facilities in a technology park in China if he would move his small operation there, even though he had never made a dime.
Atlanta and New Zealand do not need to worry about California poaching their promising technology startups.
T. Holford
Private Reply to Thomas Holford (new win) |
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