It's not often that I think Paul is flat out wrong, but this is a case. I agree with sachinag that it is culture. When the "contest" between SV and Route 128 s

It's not often that I think Paul is flat out wrong, but this is a case. I agree with sachinag that it is culture. When the "contest" between SV and Route 128 started, it appeared that Boston had the edge. Slightly better in the university ranking and a vibrant electronics industry. The big difference was the corporate culture/climate. Boston was closed and secretative. Think DEC and Ken Olsen. SV was open and cooperative, even among competitors. Think Hewlett and Packard. Maybe even more important was Frederick Terman of Stanford who pushed industry/academic cooperation. The SV culture grew from that. An engineer could talk to his buddies at other companies. If you left HP to form a company, they were probably your first customer. My first customer in my first startup was a former employer. In SV the money came because of the successes. Now SV has this huge infrastructure of talent and money. High tech angel investors invest in SV not in their own communities, because of the decision support here. One of the real difficulties in investing in Kansas City, for example, is winnowing out the 99 crappy ideas/teams to get the one that will succeed, and investors having confidence that they can do so. The best approach for another area is to pick an industry with local advantages: new energy sources, manufacturing for wind or solar, biotech, robotics. I think public funding of startups will fail, because problems with mindset. What a community can do is streamline the business permit process, build out the infrastructure like fiber, assemble a volunteer group of professional advisors, and promote the startup culture. A 10K grant to an entrepreneurs' club that promotes mixers and speakers for entrepreneurs, angels, and support types will probably help the climate more than $500K to some random startup.