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Silicon Valley Competitive Advantage and Knowledge Transfer

Silicon Valley Competitive Advantage and Knowledge Transfer. William Y. Jiang, Ph.D. Professor and Department Chair of Organization and Management San José State University 408-924-3551 Email: william.jiang@sjsu.edu. Presentation at A Glance. High Tech Developments

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Silicon Valley Competitive Advantage and Knowledge Transfer

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  1. Silicon Valley Competitive Advantage and Knowledge Transfer William Y. Jiang, Ph.D. Professor and Department Chair of Organization and Management San José State University 408-924-3551 Email: william.jiang@sjsu.edu

  2. Presentation at A Glance • High Tech Developments • Entrepreneurship and Entrepreneurs • Silicon Valley and Other High Tech Centers • Venture Capital Investment • Knowledge Transfer

  3. High Technology and US Economy High Tech Serves as • The Engine of Growth • Productivity Enabler

  4. Major US High Tech Centers • Silicon Valley • San Francisco’s “Multimedia Gulch” • L.A.’s “Digital Coast” • Seattle’s “Silicon Forest” • Austin’s “Silicon Hills” • Boston’s “Route 128” • Washington D.C.’s “Silicon Dominion” • New York’s “Silicon Alley”

  5. Major US High Tech Centers

  6. The Treaty of Guadalupe

  7. The Treaty of Guadalupe

  8. The San Francisco Bay Area

  9. The Concept of Silicon Valley • A Geographic Valley • A High Tech Phenomenon • A Technology Civilization • The Engine of Economic Growth • A High Tech Mecca • A Symbol of Creativity and Originality • A Frame of Mind

  10. The Concept of Silicon Valley

  11. Silicon Valley Maps

  12. Geographical Profile • California • Northern California • Southern California • The Bay Area • San Francisco, Peninsula, East Bay, & South Bay • Santa Clara Valley (Silicon Valley)

  13. What Is Said of Silicon Valley “Throughout Human History, the Enhanced Availability of Information Has Created Quantum Leaps in Human Achievement. From Microwave Radar to Integrated Circuits to Disk Storage to Microprocessors to Internet and E-Commerce, It All Started in Silicon Valley!”

  14. 110 -Year Renaissance • Silicon Valley, Formed by a Constellation of Cities, Companies, Research and Education Institutions, Has Impacted the World More Than Any Other Occurrence Since the Renaissance. • Silicon Valley Is a Phenomenon of Continuous Outpouring of Creativity, Inventions, and Discoveries.

  15. Historical Profile • California • Silicon Valley (Santa Clara Valley) • Before 1848 (Spain/Mexico, San José Mission) • 1850-1890 (stage coach, railroad, orchard) • 1890-1950 (Stanford, Moffett, HP, & IBM) • 1951-1960 (Lockheed, Fairchild, IBM, SIP)

  16. Historical Profile • 1961-1970 (Semiconductor/Computer) (Fairchild,Intel, & Apple) • 1970-1980 (LSI, AMD, &Oracle) • 1980-1995 (Cisco, Applied Mat., etc.) • 1996-1999 (Internet Era: AOL, Yahoo & Ebay) • 2000 -Present : Beginning of the E-Century: Google and Internet New Boom and Prosperity)

  17. Demographic Profile Silicon Valley • 1860: Population: 3500 • 1960: Population: 350,000 • 1970: Population: 1,064,000 • 1980: Population: 1,200,000 • 1990: Population: 1,500,000 • 1999: Population: 2,100,000 • 2009: Population: 2,200,000

  18. Racial Breakdown • Caucasian: 38% • Asian and Pacific: 26% • Latino: 27% • African American: 3% • Other: 6%

  19. Why the Growth in High Tech? Brain Power Diversity Venture Financing Stanford San Jose State Berkeley Culture & Climate Government Support

  20. Characters That Have Shaped Silicon Valley • Lee De Forest (Start Electronic Age, 300 Patents) • Frederick Terman (Father of Silicon Valley) • William Hewlett & David Packard • The Varian Brothers • William Schockley (Nobel Laureate) • The Fairchild Eight (Robert Noyce, Gordon Moore, etc.) • Steven Jobs and Stephen Wozniak • Larry Page and Sergey Brin

  21. Valley Wizards Shaping the Future of High Tech • Andy Grove/Craig Barrett (Intel) • Scott McNealy (Sun) • Steven Jobs (Apple and Pixar) • Larry Ellison (Oracle) • John Chambers (Cisco) • Jerry Yang (Yahoo) • Carly Fiorina (HP) • Mark Andreeson (Netscape/Loudcloud) • Meg Whitman (Ebay) • James Morgan (Applied Materials)

  22. Valley Wizards Shaping the Future of High Tech

  23. High Technology Sectors Semiconductor, Software & Hardware The Internet & E-Commerce Biotech & Healthcare Network & Telecom

  24. Internet SectorsFrom Silicon Valley to Internet Valley Content Distribution Access Bandwidth Architecture Infrastructure E-Commerce B2B&B2C

  25. History of Venture Capital • 1960s: Angel Emergence Private Investment in Silicon Valley • 1971: First “Venture Capital” Fund • 1975: Huge Success in Tandem Computers ($1mil. was turned into $3 bil. in three years) • 1978: Capital Gain Tax Reduction ($750 mil. VC) • 1980s: low tide in VC • 1991: low interest rate spurred VC ($1.5 bil.)

  26. Venture Capital Investments • 1995: $6.2 Billion • 1998: $14.3 Billion • 1999: $39.7 Billion • 2000: $98.0 Billion • 2008: $120 Billion

  27. Stages of VC Investment • Seed Stage • First Round • Second Round • Third Round (Mezzanine Stage) • Bridge Financing

  28. Why VC Flourishes in the US? • Uniquely Robust IPO Market • Efficient Secondary Markets • Legal, Accounting, and Financial Infrastructure • Flourishing Entrepreneurship • Lead in information and medical technology

  29. Role of VC in US Economy • Catalyst in the Entrepreneurial Process • Fundamental Value Creation That Sustains Economic Growth and Development • John Doer: “Largest Legal Creation of Wealth.” • Vital to the Formation and Commercialization of New Industries • Job Creation, Innovative Products/services, and Competitive Vibrancy • The Essence of Capitalism: Risk-taking and Entrepreneurship

  30. Venture Capital “One Half of All Venture Capital in America Pours Into Silicon Valley, the Unchallenged High Tech Capital of the World.” “One Third of All Venture Capital in America Comes From Venture Capital Firms Located Along Sand Hill Road in Menlo Park.”

  31. Menlo Park Benchmark Capital Mayfield Fund Institutional Venture InterWest Kleiner Perkins Sequoia Menlo Ventures US Venture Partners New Enterprises Palo Alto Garage.Com Norwest Patricof Summit Partners TA Associates Venture Capital Mecca

  32. Symbiosis of Entrepreneurs and Capital Entrepreneurs: Leading Edge Ideas Proven Management Technical Talent Risk Tolerance Silicon Valley Capital Getting Access to: Management Talent Technical Talent Tech Savvy Lawyers/Accts Business Partners

  33. Viva Entrepre- neurship! Lessons to Be Learned • Entrepreneurship and Its Encouragement • Develop and Open the Financial Markets • Encourage Venture Financing Activities • Second Chance for Risk-Takers

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