New England’s Inferiority Complex, Or Why Route 128 Lost its Mojo to Silicon ValleySpencer Ante
Posted May 28 by Creative Capital
New England’s entrepreneurial community has developed a sort of inferiority complex. This is one of the things that struck me when I attended the Nantucket Conference to do a fireside chat about my book.
One of the big questions in my book that really resonated at the conference is why did New England–which pioneered the venture capital industry and startup economy thanks to Georges Doriot in large part–lose its mojo to Silicon Valley?
I heard many explanations in Nantucket. Bob Metcalfe, General Partner at Polaris Ventures, blamed it on all the snooty Harvard professors and doctors who believe making money is a bad thing. The other big diss of New England is that area VCs too often sell out their companies too quickly, refusing to give them a chance to grow into large independent businesses. Silicon Valley VCs, by contrast, are all about creating the next world-changing company.
Pat McGovern, the billionaire founder of IDG, argued that Silicon Valley has developed a culture that places a supreme value on new risk-taking and new business formation. “People in New England don’t feel the pressure to start new companies,” says McGovern.
But McGovern boldly predicted that New England could regain its dominance thanks to the emerging hub of biotechnology companies. “The next great bubble will occur in 2013-2015 with the molecular medicine bubble,” says McGovern. “The time has come when New England could see a rapid increase in venture capital.” Developments in biotechnology and genomic-based drugs could help cure a whole range of brain complications, says McGovern.
McGovern must be taken seriously. After all, this is the guy who had the foresight and cojones to launch a venture capital operation in China. The result: generating enormous wealth from backing companies such as Baidu, Tencent and Sohu.com.
“Walk around the Boston-Cambridge area and you see the best and brightest people in biotechnology coming to here,” says McGovern. “In the next 5 to 15 years we could develop cures for Alzheimer’s, bi-polar disorder and other mental illnesses.”
What do you think? This could make for a good wiki.