Nerds and Rich People

From: How to Be Silicon Valley

Could you reproduce Silicon Valley elsewhere, or is there something unique about it?
It wouldn’t be surprising if it were hard to reproduce in other countries, because you couldn’t reproduce it in most of the US either. What does it take to make a silicon valley even here?

What it takes is the right people. If you could get the right ten thousand people to move from Silicon Valley to Buffalo, Buffalo would become Silicon Valley.

That’s a striking departure from the past. Up till a couple decades ago, geography was destiny for cities. All great cities were located on waterways, because cities made money by trade, and water was the only economical way to ship.

Now you could make a great city anywhere, if you could get the right people to move there. So the question of how to make a silicon valley becomes: who are the right people, and how do you get them to move?

Two Types

I think you only need two kinds of people to create a technology hub: rich people and nerds….

Paul Graham, author of the above essay goes on to further describe the importance of these two groups of people that are required to create a business hub along the lines of Silicon Valley.

It made me think about – what collections of people are required to create other successful business and commercial hubs as distinct from a high tech Silicon Valley? Putting aside the large industries, I’m more interested in what it takes to drive the growth of smaller regional areas.

Living in New Zealand as I do at the moment, I see a lot of regions and towns that are based on Tourism, but are struggling to command an identity that  stimulates major growth. Wellington, or Wellywood as some would like to call it, is somewhat of an exception through it’s leverage of the Film Industry. The Marlborough Wine district has an identity, Taranaki has a collection of energy and related technology businesses but how are businesses and other stakeholders cooperating and collaborating to ensure growth?

For the film industry in Wellington, the nerds and rich people theory holds true with the media based ‘techies’ of various forms coupled with well funded productions like Lord of the Rings (the rich people) you develop a dynamic that is clearly succesful.

Assuming a region has some form of ‘nerd’ community, how can it then attract the rich people? Using the winery example, the nerds and the rich people are sometimes the same in the first instance. Many small and boutique wineries are started as a lifestyle business with the proceeds of a retirement or corporate exit. Effectively the winery owner trades their corporate nerd identity in lets say IT, for a new nerd identity – Wine Making.

One succesful winery spawns another and so a region grows, more rich people nerds are attracted, independent nerds and rich people enter the equation with complementing and competing businesses and a critical mass is developed. But in the absence of this integrated rich-nerd, how do regions grow? How do nerds attract rich people? How do rich people attract nerds?

Does your region keep growing through the attraction of nerds and rich people? … or is the region dying on the vine? (to maintain the winery theme)

Paul’s essay is worth a read, let us know your thoughts on nerds and rich people by leaving a comment below.