Applying the Silicon Valley startup culture here in Sarawak
By Danielle Sendou Ringgit
Originally referring to the large number of silicon chip innovators and manufacturers in south San Francisco Bay Area, Silicon Valley is headquarters to 39 businesses in the Fortune 1000, and thousands of startup companies.
Even though it may be impossible to replicate the exact components of Silicon Valley here in Sarawak, the elements that make it a paradise for startup entrepreneurs can certainly be adapted to our circumstances.
During ‘Lesson from Silicon Valley: how to make the best of Silicon Valley and make it your own’ by Software Strategy IBM Capital Group director Deborah Magid, Sarawakians got some insight on what made a successful startup.
What is the startup culture in Silicon Valley?
“In Silicon Valley, networking and things like the community getting together with other people is not only important, it is something people do naturally,” said Deborah who facilitated the talk and workshop held From October 29 to 30th.
Deborah represents IBM’s $25 B software business in the company’s 12 year old Venture Capital Group. She is responsible for sharing insights about emerging markets, technologies, and business models with venture firms and entrepreneurs around the world as well as scouting for emerging business opportunities and share views on innovation and growth areas in market.
She is also the Chairman of the Board of SVForum, the Silicon Valley emerging technology network.
Deborah explained during her talk that it was normal for the community in Silicon Valley to meet up regularly in informal gatherings – such as breakfast or coffee breaks or in meet ups and pitch in sessions – to talk about their business ideas.
“In Silicon Valley, people do that all the time. Not only that, they are really helpful to each other. They mentor each other and they are also open and transparent with each other. So, people like to share idea to get advice.”
While it may sound natural for people to talk about their business ideas in Silicon Valley, this practice is not so common anywhere else.
Recalling back on her experience as a pitch judge in Kuala Lumpur sometime ago, she remembered one person from the audience who said that he did not take part in pitch sessions or competitions as it would require him to tell other people about his business.
For Deborah, this culture of secrecy could lead to many missing more opportunities rather than advantages.
“So, you don’t get coached, and you do not find potential employers or business partners, you do not know who your potential customers are going to be because you are not telling people about your potential business. That is not helpful.”
“And so this level of secrecy is not common in Silicon Valley, people are very open,” she said, encouraging more people to be more open and do more sharing with each other as well as joining start-up communities that are available around.
In 2013, it was also reported on the Global Entrepreneurship Monitor that Malaysia was among the few economies in the Asia Pacific and South Asia region where finance and physical infrastructure to support entrepreneurship were widely available.
Despite the finance opportunities and support provided by the government and institutions nationwide to help empower entrepreneurs, however, the country’s total early stage entrepreneurial activity rate (TEA) is the second lowest in the region above Japan.
With the finance opportunities and support provided by the government and institutions nationwide to help empower entrepreneurs, Deborah added that it would be wise move to take advantage of it as the start ups ecosystem has been thriving with the presence of financial schemes, accelerators programmes, social impact fund for social entrepreneurs, incubators such as StartupMalaysia, MaGIC and Bumiputera Entrepreneurs Startup Scheme (Superb) to name a few.
The mentor-mentee culture
“And one other thing that is less common here is the ability to share information about your business. In Silicon Valley, people are very open about what they are doing,” she said.
She referenced Steve Blank, a Silicon Valley serial entrepreneur who has founded or worked within eight startup companies, in which four of which have gone public.
“A lot of entrepreneurs who found companies and create companies – in their heart they love doing this – and that is how Steve is. Not only that… guess what he does? He teaches in universities and mentors start-ups and he coaches other young companies that are trying to make their way in business,” said Deborah.
“So, people who are successful gives back to community. And that is another thing that Steve does, and that is another common thing in Silicon Valley.”
Deborah also noticed that awhile she was traveling across South East Asia that a lot of senior experience business people do not consider being mentors.
“They would not think of taking some time from their busy schedule to go coach somebody who is just starting out a business,” said Deborah.
“If the start-ups are successful, they hire people, the economy is lifted and the whole industry is successful and so does other industries. And in Silicon Valley it is common for people to coach each other and take care of each other, and it needs to be more common here.”
Trends for start up
“There are a number of things that are driving changes in the industry and that are important to Silicon Valley and all over the world to provide solution to the world,” said Deborah.
“A few years ago, you saw the importance of cloud computing. This is still true and very important but they are not new trends anymore.”
With the industry moving so fast, it is hard to keep track to find something that is really new.
“So, the things that are pretty new are cognitive systems. So robotics, artificial intelligence, machine learning, those are the things that are receiving a lot of investment and a lot of attention from investors in Silicon Valley and other parts of the world as well.”
“And if you look at these technologies and what you can do with them is to make the system smarter and more intelligent,” said Deborah, adding that technology can be used to solve problem and start ups use that to create opportunity in business.
Here in Malaysia, examples of successful and well known start-ups are MyTeksi, Groupon, 100% Project and DeliverEat who all use advances in technology to create their businesses.
“People see a problem and they understand what the problem is and a lot of those problems are local, so they think of how they could help with the problems that they see,” said Deborah adding that the problem could be in any industries such as health care or agriculture or even food safety but with the goal of making things work better.
In Malaysia, the opportunity for start ups is increasing as the government supports the start ups ecosystems especially among the youths.
While this may be good news for the youths, a common mistake often made by young entrepreneurs who just started their own business is not checking on who their potential customers are.
“So they do not know that they are actually building something that people would actually buy or actually pay money for,” she said, adding that another mistake people tend to make is they forget to figure out who their competitors are.
“They think they are doing something completely unique, but they do not see around what other people are doing therefore they can fail because of that.”