The next Silicon Valley is already online

For me, college was the best time to build startups. Living and working in the Silicon Valley has been the second best. Nowhere else in the world comes close, but will it stay that way? No. The next Silicon Valley is already online.

Why do all the best startups come out of Silicon Valley?

Life is just a game. We can understand the magic of American colleges and Silicon Valley by seeing how they are successful games. 

American colleges are unique because the time we spend in college is time devoted to playing. The mission of the college game is personal growth. In the name of personal growth, we condone all kinds of behavior in college as long as they don’t cross the line. This tolerant attitude means you essentially can’t lose the game no matter what you do, so you keep on playing and trying new strategies until your time is up. Every student is playing the game with like-minded peers who share the mission and the timeline of graduation. While personal growth is difficult to measure, success at attaining it is invaluable, and almost everyone is willing to offer feedback to help you determine how well you are playing [1].

Similarly, Silicon Valley also has a culture that encourages play. The mission of the game is startup growth, and just like in college, Silicon Valley condones all kinds of behavior while chasing startup growth (although this is increasingly less the case). Players are surrounded by like-minded peers who share the mission and the timeline of the VC investment horizon. To figure out if you are winning, almost everyone — including the most successful entrepreneurs — are willing to offer feedback. The only notable downside of Silicon Valley compared to college is that, in order to play, you have to trade a reliable salary and a conventional career, and you can’t simply restart the game when you fail to recuperate your losses. In Silicon Valley, we do as much as we can to minimize the cost of failure by celebrating them and offering founders ample opportunities, but it’s near impossible to neutralize the effect of failing in the “real world.” 

Still, this puts Silicon Valley far ahead of any other place in the world at attracting players for the startup game. Trying to replicate the magic would mean replicating all of the following elements:

  • Playful spirit: Spirit that encourages play and experimentation
  • Minimal cost to losing: Failures give you experience points that are valued by others to reduce the pain and make you want to keep playing
  • Enticing mission: Personal growth or startup growth
  • Time-bound: By graduation or within the VC investment horizon
  • Community: Talented peers who share your mission
  • Variable reward: You might discover your life’s calling or build a unicorn startup
  • Meaningful and tight feedback loops: The advice from a mentor or a seasoned entrepreneur could change everything, and they’re willing to help early in your journey

Viewed this way, accelerators like Y Combinator and StartX “accelerate” by shortening the time-bound (12 weeks) and intensifying the community (application process), variable reward (investor demand on demo day), feedback loops (weekly check-ins with feedback from top founders), and minimizing the cost of losing (becoming a YC or StartX alum is itself an accomplishment).

Outside of the Silicon Valley, there’s typically too much cultural inertia that would take generations to overcome to line up all of the elements above, but such limitations do not exist online. In fact, the next Silicon Valley is already online.

The next Silicon Valley is already online

Current winner: Pioneer

Pioneer’s player home screen (courtesy of Lama Al Rajih)

Pioneer is building “a home for all the ambitious outsiders,” which is an enticing mission for everyone without traditional access to the valley or not working on a traditional startup. They run four-week tournaments and you play by simply submitting weekly updates describing the progress you made on your project and by voting and giving feedback on other people’s progress updates. Winners get some money, a plane ticket to the valley, and meetings with Silicon Valley “insider” mentors. Everyone who participates also gets to be part of a community of like-minded peers. Unlike the Silicon Valley, Pioneer doesn’t require you to trade your job to play and also doesn’t limit you to “startups.” The feedback loop is tight and meaningful because it happens weekly and is solely based on the weekly goals you’ve set for yourself. Pioneer nailed most of the elements of what makes for a successful game and leveraged the Internet to recruit players, build a community and eliminate the cost of play.

Runner-up: Y Combinator Startup School

Startup School is the “farm system” for YC, targeted at those who are interested specifically in building startups like we do in the valley. Anyone can participate and the cost of play / risk of failure, like Pioneer, are virtually zero. The “course” transpires over ten weeks during which you watch lectures, submit weekly progress updates and attend group office hours with an advisor. If you complete the tasks, you can win the variable reward of $10,000 towards your startup and improve your chances of getting into Y Combinator because advisors take notes about each participant to give YC more data points. Like Pioneer, there’s an ever increasing number of strong community members with every new course. 

Notable mentions: Product Hunt, IndieHackers and ShowHN

Product Hunt is a community of makers with the mission of finding and celebrating the world’s best products. You play by posting a product (could be yours) to the daily leaderboard and the community votes it up if they like the product. Winner gets a badge, bragging rights, and some traffic. However, Product Hunt’s mission limits it to players who have a finished product that fits the appetite of the community, otherwise the feedback won’t be meaningful. Also, like all leaderboard-type communities, winning could simply devolve to a popularity contest. 

IndieHackers and ShowHN are also limited like Product Hunt. While they have differentiated missions focusing on “indie” businesses and technical projects respectively, the feedback you get from playing is very much about how much your project appeals to the community. Additionally, all leaderboard communities are subject to gaming and randomness like whether or not people are browsing when you are posting. 

Opportunities to build more and better Silicon Valleys online

Using the list of elements that make for a good game, we can see opportunities for more Silicon Valleys online. 

More variety of online communities with differentiated missions

Just like there was a wave of accelerators that followed Y Combinator differentiated by startup verticals, there’s an opportunity to do the same thing online. Different types of players resonate with different missions, and from there you can design a better community, better variable rewards, more meaningful feedback loops, etc.

Lower the barrier to play and reduce the cost of failure

Pioneer’s weekly update is an example of how you can remove barriers to playing. Regardless of how much time and money you have, you only need to submit a weekly update to play, and progress is measured against your own goals. It is too early to tell but this kind of play may prove too generic to form a strong community identity or may end up selecting for a certain kind of project where there is rapidly observable progress from week-to-week. How do you design for scientists doing lab work that takes more time to make progress?

Many people I know want to work on side projects but they simply need an excuse and another person to work with. What if individuals can join a free agent pool with a mechanism for teaming up? For individuals working a 9-to-5, what if there’s a weekend-only version of the game where they are on equal footing with everyone else? What if you can remove the risk of leaving a 9-to-5 by paying talented people to get started? Entrepreneur First and Antler have really interesting models offline where they pay talented people a stipend to live and work in a house for two months with other talented people, for the sole purpose of finding a teammate. Should they succeed, they can pitch an idea and receive funding for a company afterwards. 

Tighter, more meaningful feedback loops

All of the online Silicon Valleys I mentioned rely on the community to give each other feedback, which is meaningful, but not as consistently meaningful as feedback coming from an expert or an experienced advisor. However, expert and advisor feedback are infrequent and don’t scale. For products, what if we had a “Product Discovery Network” where a network of micro-influencers of various types can share your prototype or even just the concept pitch to their audience in the name of supporting more creative endeavors? For example, I’m friends with a few travel hackers who have small audiences that could provide very meaningful feedback to a travel entrepreneur. For products that have more to do with “taste” like fashion and music, a mechanism to surface talent and loop in a taste maker like a fashion magazine editor or a record label executive will likely be very meaningful.

More enticing and plentiful variable rewards

Why aren’t TinySeed and Indie.VC giving away enticing variable rewards to the IndieHacker community like an investment opportunity or a cash grant? If a community is broad, why not have different “tracks” or “side quests” so more people can win? What if Shopify gave out rewards for IndieHackers whose businesses are run on Shopify?

Make playing cool again

The biggest barrier ultimately comes from the fact that most societies don’t value play. Most of the “games” we play in life do not have the playful spirit. We have the opportunity to leverage the Internet as a disruptive force on cultural values, and we can do that by supporting and elevating the status of online Silicon Valleys. What if everyone is part of the “Product Discovery Network” and an integral part of the process of creation regardless of what your job is? I’d happily put a #tech hashtag on all of my online profiles to signal that I have a #tech audience and I am part of celebrating creativity online. 

A little bit of the Silicon Valley magic for everyone

A random decision when I was eighteen took me to Stanford and a series of random decisions kept me in the Silicon Valley where I’ve been relishing in being able to play this fun and exhilarating game. As the technology industry comes under more mainstream scrutiny, it feels like we are starting to lose some of the playful spirit that made it all possible in the first place. I hope we can balance growing into a mature industry with maintaining the spirit of play. Regardless of what happens, we can create many more Silicon Valleys online by learning from made Silicon Valley magical in the first place in order to make sure that we continue to ignite play everywhere for everyone. 

[1] Stanford has an edge over the other colleges beyond its location because it’s one of the few schools with a lenient leave policy. It also has one of the more friendly technology licensing policies so students get to keep what they create. There is also enough of a blend between industry and academia that the dominant value system is not 100% academic.

Thanks to James Gallagher (winner of Pioneer Tournament, who shared his experience here), David Tran, Ivan Lee, Wil Chung, and Richard Lo for reading drafts of this article

One thought on “The next Silicon Valley is already online

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.