Importance of ecosystem

Barack Obama got in a lot of trouble in conservative circles for saying “You didn’t build that”. He was talking to business owners who run their operations over infrastructure that the public pays for via the government. A statement like that from a statesman comes across as incendiary to a lot of people because they don’t understand the importance of ecosystems.

It was a bit of an incendiary statement anyway, actually.

I was watching sourdough artist David Peterson’s video interview with David Kong from frame.io the other day and was kind of struck by this great little throwaway bit:

I was actually a customer of Frame.io when I was at Khan Academy. I was a very happy customer, I loved the product. They were looking for someone to build their marketing platform.

I have talked to a lot of folks here in Singapore about how they navigated the startup ecosystem and there are very few stories like this - where someone is using another product within the local ecosystem and then they jump into that company as the next step in their career. David Kong’s career seems more like a journey than the traditional ladder climbing hierarchy of a large organization.

Large organizations can teach you invaluable skills about your craft, the world and perhaps least importantly: how to navigate large organizations. Ecosystem navigation looks a bit different and is perhaps a far more exciting way to pursue your career.

Ecosystems can be tilted one way or another and are affected most by the investors and their attitudes. A founder here in Singapore who went through YC in the US illustrated the difference to me:

In Palo Alto, you can have a 30-minute conversation with someone and they’ll send you a $100k check. When you’re having trouble with the hardware prototype and you ask them, they call up someone who is worth $100 million to come down to your garage on the weekend and hack on it with you.

Silicon Valley gets a lot of flak for being a hostile place, and there are certainly a lot of jerks around, but the overall tenor of the ecosystem is radically different from a place like Singapore. There simply isn’t as much of a deep technical enthusiasm in the scenes outside of Silicon Valley.

Why?

Technical talent is global

Truly technically talented people can go anywhere, so they often pick the most vibrant ecosystem they have access to, and for many that means getting a US visa and going to Silicon Valley. You level up faster in a dynamic ecosystem with tons of companies to choose from - untapped markets (like where you are originally from) might be untapped because they’re untappable.

Technology doesn’t make money

A group of very good technologists all sitting together building technology together will not necessarily make a good product. Even if you build critical mass of technical talent outside of SV, investors have to believe in the long timelines required to make a futuristic technology work. They also need the connections to hand off your super-advanced product to someone. If they’re in Asia, the deep pockets are usually agricultural and natural resource companies that do not have the ability to digest startups the way big Silicon Valley guys do. Chinese companies are changing this a bit, of course.

Investors don’t trust black boxes

Many investors outside of Silicon Valley didn’t make their money off of tech. They don’t necessarily understand the principles and business models behind tech companies. They would much rather pursue the traditional business of “squeeze costs and drive immediate profits”. Even if they are VCs, they might not be VCs who believe in the type of moonshots early SV used to. Which, honestly, might be for the best.

All of these factors drain enthusiasm for deep technical companies and products. I am not sure whether that’s actually a shame or not yet. The environment might simply not need it or be enhanced by it. After all, if people were willing to pay for it, wouldn’t it exist?