Economic thinking that encourages and supports people with innovative ideas to start new companies is the Capital Region’s best path to becoming another Silicon Valley, a Silicon Valley venture capitalist said Wednesday.
The region needs to be willing to support people with new ideas out of a sense of teamwork, understanding that many startups will fail, said Victor W. Hwang, co-author of “The Rainforest: The Secret to Building the Next Silicon Valley.”
“Try fast, learn quickly, fail small and rapidly evolve,” summarized Hwang, speaking to more than 100 people at the Saratoga Springs City Center.
Hwang has been in the Capital Region this week at the invitation of the Saratoga Economic Development Corp., Saratoga County’s economic development agency.
Hwang’s talk, and a panel discussion that followed, are part of an ongoing effort to take advantage of the arrival of the GlobalFoundries semiconductor plant in Malta, the College of Nanoscale Sciences and Engineering in Albany, and other high-tech development.
Supporting start-ups involves bringing people with different areas of expertise together and requires them to extend trust to each other, Hwang said, despite the instinctive tendency to distrust strangers.
“You need to build teams of people who ultimately function as a team. It’s very hard to do, but it has to happen,” Hwang said.
Panelists said the Capital Region is on its way to developing a high-tech cluster of companies, but is not there yet.
“I think the Capital Region is actually fairly well positioned,” said Ken Pokalsky, vice-president of the Business Council of New York State.
He said the Capital Region is already following Silicon Valley’s model, with local universities providing the innovations and expertise that Stanford University provided in Silicon Valley.
“I feel very optimistic about Saratoga and the Capital Region,” said Charles Wait, president of the Adirondack Trust Co. in Saratoga Springs. “I think we have finally reached a critical mass.”
But Wait warned against the danger of complacency, noting every city in the region has had a heyday that then faded. “It’s hard to build success, but it’s really easy to lose it,” he said.
Matt Ammerman, co-founder of 5-year-old Clifton Park software development company Apprenda, said startups need access to money, legal advice and business advice, and often entrepreneurs don’t have the up-front money to pay for such advice.
“Starting a high-tech company is like jumping off a mountain and assembling a plane on the way down,” he said.
Travis Bullard, manager of public affairs for GlobalFoundries, said when plans for the plant in Malta were announced in 2006, others in the high-tech world found it “bizarre.” Since then, the region has drawn a lot of national attention, in large part because of GlobalFoundries’ creation of 1,600 local manufacturing jobs.
“The fact GlobalFoundries is here is going to provide a lot of benefit to the region, both tangible and intangible,” he said.
Hwang’s “rainforest” concept is that while businesses are often like farms that try to efficiently cultivate a single product, a community can act like a rainforest, in which a wide variety of vegetation thrives.
“Hopefully you’ll see the rainforest effect as an outcome of this very cultivated project, a semiconductor plant,” Bullard said.
Dennis Brobston, president of the Saratoga Economic Development Corp., said he hopes to hold more presentations on economic development ideas.
Just last week, two local entrepreneurs appeared with Apple Computers co-founder Steve Wozniak on a panel at GlobalFoundries on the region’s strengths and weaknesses.
“We’re blessed in this region with people with knowledge, and we should listen to them,” Brobston said.