“When you look at me, you see an old man,” an 80-year old man told a friend of mine at a wedding reception a few years ago. “But when I look in the mirror, I see the face of a 19-year-old.”
Then he scampered off to the dance floor.
The magic advice of Mr. Martini came floating back to me this week after a round of high-tech conferences. The nations of the world are clamoring to become the Silicon Valley of Green. China, Japan, South Korea, France, Finland, Denmark, the United Arab Emirates and many U.S. states have combed their universities for interesting intellectual property and created plans to woo investors and corporate partners.
Each touts sparkling industrial parks, high-ranking schools, tax holidays and enough laboratory and/or clean room real estate to pave Luxembourg twice over.
But what is often missing, and what can help seal the deal, is good ol’ fashioned salesmanship and a willingness to go the last mile. Andrew Chung of Lightspeed Venture Partners, for instance, told me how provincial officials in China hold celebrations for visiting dignitaries. CoalTek, a startup founded in Georgia and trialed in Kentucky and a Lightspeed portfolio company, has turned 100 percent of its orientation toward Mongolia.
Mississippi convinced four high-tech startups to open factories in its state last year. Financial incentives played a huge role. The state has given the companies -- Twin Creeks Technologies, Soladigm, Stion and Kior -- approximately $254 million in low-cost loans. Not loan guarantees like the DOE is giving out, but real loans: the state takes out bonds and hands them over without a markup to startups, according to Kathy Gelston, chief financial officer for the Mississippi Development Authority.
The ease of doing business in the state was also a key factor. If a company wants to speak to the department of revenue or secretary of state, they just have to make a few calls and a meeting is set, she said. The state doesn't even have asolarprogram.
Another company contemplating creating facilities in Ohio was greeted with a roundtable of the state’s business leaders. The state moved to the top of the list.
By contrast, Israel has been trying, but without much success, to persuade multinational pharmaceutical manufacturers to open labs. Israeli universities have a wealth of biotech talent and technology.
Back in the '80s, Israel convinced high-tech firms like Intel, Motorola and Nokia to open labs and development centers: but for the occasional Hebrew sign, the industrial park in Haifa is a spitting image of Great America Parkway in Santa Clara.
“The government regulations have become too tough,” said Dan Kaufman, Bengis Center for Entrepreneurship and High-Tech Management at Ben-Gurion University. “We have lost the flexibility to do tailor-made projects. [...] We were very innovative in the '80s.”
California, meanwhile, has a dismal reputation in this regard. Solopower, based in Silicon Valley, is going to Oregon. Bridgelux CEO Bill Watkins and Miasole CEO Joseph Laia have both said they would like to keep factories in the U.S. and even California. Drive down Walsh Road in Silicon Valley, says Laia, and look at all the empty offices.
But good luck getting action from the state’s business revitalization bureaus. With our action-figure governor gone, it will be even harder. Meanwhile, calls from overseas pour in on a regular basis.
Again, money talks, but salesmanship helps. Between two competing deals, it can become a factor. It can also in turn make a state bureaucracy more flexible and dynamic: once a deal is on the line, you’re more determined to land it. Self-imposed sclerosis: that’s the real problem facing California and Israel.
Contrary to conventional wisdom, the U.S. is not categorically at an economic disadvantage to China. Labor costs less in China, but automation is reducing that delta. 'Buy American' standards also give an incentive to build in the U.S. Labor and raw materials cost less in China, but increased automation and other factors can narrow the gap.
Technology geography is also not fixed. After World War II, Philadelphia was the epicenter of the U.S. computing industry and TV industry. Stanford -- under the direction of Fred Terman -- aggressively sought government grants and industry leaders. Persuading William Shockley to come here was the first step in a tip in the balance of power that has lead to Silicon Valley being a world icon.
This also -- and I don’t think I need to say this, but I will -- plays straight into American strengths. Let’s face it. We are not intellectuals. Almost all of our great scientists were born in other countries. Our science and math scores barely put us in the top ten percent of zoo animals.
But we excel at glad-handing. We gave the world Guy Fieri of the Food Network and Billy Mays. University mascots and corporate togetherness seminars! We are the steak house waiters of the world tossing a Caesar salad at tableside. Whenever I interview European or Asian companies, I will come across a self-deprecating, semi-off kilter exec who seems to revel in rocking the boat. Invariably, they were trained in America.
Just embrace it.
Granted, like innovation and high tech, we don’t have a monopoly on this. China has learned fast and the optimism is palpable. This is one of the few times in its 5,000-year-plus history when tomorrow will be better than today.
It won’t be easy. But I believe that you, my fellow Americans, can rise to the flesh-pressing challenge.