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I have heard the hypothesis that the main reason Silicon Valley was able to grow is because non compete clauses are invalid in California. So people can start

I have heard the hypothesis that the main reason Silicon Valley was able to grow is because non compete clauses are invalid in California. So people can start a side business competing with their employer, and only risk being fired (as long as they dont steal IP) They could also freely hop from company to company without waiting in between.

austincheney 5y ago
That’s nice in theory and likely a factor over some areas. The primary differentiator is a culture of local access to VC funding. It explains both the timeline and geographic distribution.
- twblalock 5y ago
  The concentration of VC funding didn't happen before the local tech companies. It happened because of the local tech companies.
  - adventured 5y ago
    It happened simultaneously, they required eachother in lockstep. Shockley was the spark that set SV on fire (not HP). By chance he ended up in the SV area, moving from New Jersey to Mountain View because his ill mother lived in Palo Alto. Beckman Instruments provided the capital for Shockley to start his company, which led to Fairchild (also formed by outside capital) and off it went. Those companies would not have existed without the venture capital that made them possible. Shockley was not going to bootstrap his company, and the traitorous eight were similarly not going to leave without significant financial support courtesy of Fairchild Camera.
    - twblalock 5y ago
      That's all different in character from modern VC in the valley though. People were not forming firms with the intention of seeking out tech startup investments in a systematic way like they do today. A unique culture has emerged since then. When the traitorous eight left Shockley, what they did would have been career suicide on the east coast. Now it is encouraged in Silicon Valley corporate culture.
not2b 5y ago
Yes, it's argued here that this is how Silicon Valley won out over the Boston area (DEC, Pr1me, Wang, MIT, so many other great universities): https://www.vox.com/new-money/2017/2/13/14580874/google-self-driving-noncompetes https://www.vox.com/new-money/2017/2/13/14580874/google-self...
- adventured 5y ago
  The more liberal atmosphere around non-competes surely played a role. Silicon Valley was also ideal because the land was inexpensive in the early days, compared to most metro area real-estate, the weather was vastly superior to East Coast cities like Boston and NY, and the culture on the East Coast was stuffy, slow and rigid (whereas there was excitement to going west, blazing a new trail; the culture of California was very different from the East Coast). Having the old corporate giants on the East Coast was oppressive and antithesis to the birth of something like Silicon Valley. SV was the new world, they built it up from farm land. Given the context, it doesn't matter if Boston has nice universities: they become poaching grounds for Silicon Valley in that respect. The Yankees don't care if their minor league teams are in Tampa or Atlanta, they're taking the talent regardless of where it's at. The talent will almost always happily move for the right price and or opportunity.
  - not2b 5y ago
    The "silicon" in Silicon Valley got its real start with the "Traitorous Eight", who had the audacity to leave an employer and go immediately into direct competition with that employer. Not sure what role state laws played in making it possible. https://en.wikipedia.org/wiki/Traitorous_eight https://en.wikipedia.org/wiki/Traitorous_eight
not2b 5y ago
California doesn't completely prevent companies from limiting side businesses, they might be able to claim your work depending on your employer agreement and how similar it is to what your company does. But they can't keep you from working in the same field if you quit.
kd5bjo 5y ago
I always understood it to be rooted in raw materials: The silica mines were there, which attracted semiconductor fabs, which attracted hardware companies, which attracted software companies, etc.
Elof 5y ago
It also has some world class universities, fantastic weather, and is surrounded by beautiful nature

austincheney 5y ago

That’s nice in theory and likely a factor over some areas. The primary differentiator is a culture of local access to VC funding. It explains both the timeline and geographic distribution.

twblalock 5y ago
The concentration of VC funding didn't happen before the local tech companies. It happened because of the local tech companies.
- adventured 5y ago
  It happened simultaneously, they required eachother in lockstep. Shockley was the spark that set SV on fire (not HP). By chance he ended up in the SV area, moving from New Jersey to Mountain View because his ill mother lived in Palo Alto. Beckman Instruments provided the capital for Shockley to start his company, which led to Fairchild (also formed by outside capital) and off it went. Those companies would not have existed without the venture capital that made them possible. Shockley was not going to bootstrap his company, and the traitorous eight were similarly not going to leave without significant financial support courtesy of Fairchild Camera.
  - twblalock 5y ago
    That's all different in character from modern VC in the valley though. People were not forming firms with the intention of seeking out tech startup investments in a systematic way like they do today. A unique culture has emerged since then. When the traitorous eight left Shockley, what they did would have been career suicide on the east coast. Now it is encouraged in Silicon Valley corporate culture.

not2b 5y ago

Yes, it's argued here that this is how Silicon Valley won out over the Boston area (DEC, Pr1me, Wang, MIT, so many other great universities): https://www.vox.com/new-money/2017/2/13/14580874/google-self-driving-noncompetes https://www.vox.com/new-money/2017/2/13/14580874/google-self...

adventured 5y ago
The more liberal atmosphere around non-competes surely played a role. Silicon Valley was also ideal because the land was inexpensive in the early days, compared to most metro area real-estate, the weather was vastly superior to East Coast cities like Boston and NY, and the culture on the East Coast was stuffy, slow and rigid (whereas there was excitement to going west, blazing a new trail; the culture of California was very different from the East Coast). Having the old corporate giants on the East Coast was oppressive and antithesis to the birth of something like Silicon Valley. SV was the new world, they built it up from farm land. Given the context, it doesn't matter if Boston has nice universities: they become poaching grounds for Silicon Valley in that respect. The Yankees don't care if their minor league teams are in Tampa or Atlanta, they're taking the talent regardless of where it's at. The talent will almost always happily move for the right price and or opportunity.
- not2b 5y ago
  The "silicon" in Silicon Valley got its real start with the "Traitorous Eight", who had the audacity to leave an employer and go immediately into direct competition with that employer. Not sure what role state laws played in making it possible. https://en.wikipedia.org/wiki/Traitorous_eight https://en.wikipedia.org/wiki/Traitorous_eight

not2b 5y ago

California doesn't completely prevent companies from limiting side businesses, they might be able to claim your work depending on your employer agreement and how similar it is to what your company does. But they can't keep you from working in the same field if you quit.

kd5bjo 5y ago

I always understood it to be rooted in raw materials: The silica mines were there, which attracted semiconductor fabs, which attracted hardware companies, which attracted software companies, etc.

Elof 5y ago

It also has some world class universities, fantastic weather, and is surrounded by beautiful nature