The latest on Route 128 vs. Silicon Valley
A topic that always gains attention around here -- the comparison between New England and Silicon Valley as a bastion of high-tech innovation -- was rekindled today as two recent articles/posts circulated the agency. We always enjoy the latest twists on a very old subject, and weigh in ourselves on this blog.
The first post by Spencer Ante of BusinessWeek actually came last week as he pondered the conversation at the latest Nantucket Conference about the subject. His takeaway from this was that "New England's entrepreneurial community has developed a sort of inferiority complex." He then recapped answers to a question he asked attendees (also a question explored in his recently released book) about why Silicon Valley is regarded as the leading technology region.
Among the many reasons, one that was most interesting to me was about how investors here have a preference for seeking exit through acquisition rather than IPO. He also quotes IDG's Pat McGovern, who says that "people in New England don't feel the pressure to start new companies." But a very interesting point was made in the comments to Spencer's post by Mike Masnick of the Techdirt blog. He touches on research that has shown a primary factor to be a freer movement of talent in the Valley.
What the research showed, interestingly enough, is that the single biggest factor was that noncompete agreements are enforced in Massachusetts, but not California. That was the single largest differentiator, according to multiple studies that attacked the question from different angles.
Why did this matter? Because there was much more job hopping in Silicon Valley, and that resulted in much faster cross-pollination of ideas, which meant faster innovation.
Coincidentally (or not), Scott Kirsner also touched on the topic in his Boston Globe Innovation Economy column yesterday about Y Combinator, the technology incubator that operates here and Silicon Valley. The high points from this article were around how VC's here have a penchant for investing in start-ups founded by older, serial entrepreneurs with a track record as opposed to first time twentysomethings that could be the next Google or Facebook.
While the facts and trends are there, I have gotten a feeling that there is more of the type of entrepreneurial activity of the kind Y Combinator attracts, but a problem is that there is no TechCrunch-type blog here that cheerleads and celebrates as much of the good work here. Xconomy is an excellent blog that is trying to carry that torch, but its influence isn't yet comparable to any of the big blogs from the Valley.
What do you think? Are there other factors at play, or is this much ado about nothing?
