Rainforest Rev: Farewell, Silicon Valley

Farewell, Silicon Valley

This is bittersweet to write.  After 9 years in Silicon Valley, I’m moving.

It has been a journey at times thrilling, surprising, and agonizing.  But never boring.  I want to share with you a few takeaways.  We’re also making some changes at T2 Venture Creation, and I want to share those with you too.  We’re spinning out our consulting practice into a new firm, Rainforest Strategies.  And we’re ending our lovely newsletter.

Starting next week, I’ll be the Vice President of Entrepreneurship at the Kauffman Foundation, based in Kansas City.  The job truly excites me.  It’s an opportunity to transform the startup economy and touch millions of lives.  If I had to design a “dream job,” this would be it.

But I’ll miss the Valley.  I admit it – when I moved here, I wasn’t sure I’d like the Valley.  But we were starting a new and unique venture firm, and it felt obligatory.  I had to be in the Valley.  So I dived in.  I breathed it, absorbed it, dissected it.  And eventually I became a part of it, helping shape its ecosystem and hopefully making it even better.

In the process, I developed a deep understanding of what makes the Valley tick. I wrote and co-wrote a few books about it.  I started a conference for “ecosystem builders” from 50 countries.  I co-founded a startup making the world’s fastest, finest filters for safe drinking water.  We even won TechCrunch Disrupt – you can check out our awesome product here.

Here are a few parting reflections from nearly a decade immersed in Silicon Valley.

First, culture is everything.  People talk about culture a lot.  But until you’ve spent serious time “in the trenches” of an innovative, high-speed, high-risk environment like the Valley, it’s hard to really understand.

How to describe it to someone on the outside?  Remember that time in your life when you stuck your neck out for something. It was scary; you faced criticism; things didn’t work right.  Now imagine sticking your neck out three times as far.  Now imagine doing that day after day.  And now imagine doing that for years. There are a ton of people doing that the Valley.  It’s impressive, even heroic.  When they say that Silicon Valley is not a place but a state of mind, it’s true.  Talented people are everywhere in the world. But right mindsets are precious.

Second, the headlines are a head fake.  When you read the major media covering the Valley, you find mostly stories about big companies: Apple, Google, Facebook, Twitter, Uber, Tesla, etc.  These are exciting, dramatic stories of titans doing battle.  But the stories aren’t what really make the Valley the Valley.

The real Valley happens under the radar, when no one is watching, when no one cares.  It happened when Larry and Sergei first met at Stanford.  It’s the day Zuckerberg moved here from Boston.  It’s the moment Jobs and Wozniak finished their first circuit board.  The New York Times missed those headlines.  But the lunchtime serendipity, the coffee shop napkin sketches, the flashes of insight, the first prototype tested – that’s where the breakthroughs are made, where imaginary barriers are smashed.  Those are the sparks that years later can improve countless lives, provide valuable goods and services, and even topple dictators.  The real Valley is made of all the little stuff that never makes the news, but someday changes the world in huge ways.  Don’t be fooled by the easy headlines.  Look for the unwritten headlines.

Third, the new economic paradigm is already here.  But it’s mostly a secret. What do I mean? Today, more and more wealth is derived from values that are manifested as certain behaviors.  Open-mindedness, high trust, diversity, team-building, information-sharing, willingness to take risks, experimentation, rapid iteration.  Those are soft and fuzzy.  But innovation thrives in those environments.  Take a walk down University Avenue in Palo Alto; look in the cafes at the entrepreneurs working.  You can actually “see” those values buzzing everywhere.

Why is this recipe still a secret?  Because we’ve been taught for decades – by the “experts” – that economic activity is value neutral, that reason should overcome emotion. But Silicon Valley has flipped the model upside down.  The Valley is living proof that values – practiced by living, breathing, emotional human beings – are core to innovation, and thus critical to modern wealth creation. That’s a huge shift in the economy.  Most people have a hard time believing it.

The Next Chapter  

As we turn the page, we’re spinning out our consulting practice from T2.  The new firm, Rainforest Strategies, is being led by three brilliant practitioners that have been doing the work on our team for years.  If you are seeking to drive innovation in a company, community, country, or organization, these guys are the best in the business.  They are using the science of innovation ecosystems and creating universal tools for enabling systemic change.  It’s complex stuff, made simple.  It really works.

We’re also shutting down our newsletter, the Rainforest Revolution.  We’ve been running this service for three years, reaching about 20,000 people every week or two.  I am proud that the newsletter was a pioneer. When we started, the idea that entrepreneurial ecosystems could be intentionally and scientifically “designed” was considered odd, even laughed at.  Today that idea is everywhere.  I hope we played a small role in that.  Viva la Revolution.

So farewell, Silicon Valley.  I loved you most of the time.  I couldn’t stand you more times than I can count.  But you’re the Florence of the innovation economy.  And it’s been a privilege and honor.

Life moves on, but certain truths will always remain.  Innovators and entrepreneurs already know them intuitively.  Handshakes are more durable than contracts.  Altruism is more efficient than selfishness.  And silly things like trust and dreams and love… they really do power the world.

Time to turn the page, but stay in touch…

Victor W. Hwang
CEO, T2 Venture Creation

Rainforest Rev: Who Created the Economy?


Who Created The Economy?

Economic prosperity was an evolutionary phenomenon. The more people trade and the more they divide labour, the more they are working for each other. The more they work for each other, the higher their living standards. The consequence of the division of labour is an immense web of cooperation among strangers. Read more…

The Dawn Of The “Craft Economy”?

Innovation Observer
Small companies can now compete with larger players, and even disrupt them with the ferocity not imagined just a few decades ago. The real question of today is how small and large companies can work together to ensure global economic growth through innovation. Read more…

How The Arts Add To Urban Economies

The Atlantic
A recent study finds substantial evidence that performing arts organizations can help cities attract talent, spur innovation, and grow their economies. These organizations can be the proxy for the broader creative and cultural climate of a city. Read more…

To Succeed As An Entrepreneur, Focus On The 5 Golden Priorities

Five priorities to serve as entrepreneurial groundwork: innovation, profitability, cash flow, culture and improvement. Read more…


The Surprising Startup Hub That’s Second Only to Silicon Valley

The Nordic countries, particularly Sweden, have the highest percentage of unicorns per capita in the world, and have developed more successful brand-name billion-dollar startups. Read more…

How A Nation Of Tech Copycats Transformed Into A Hub For Innovation

China’s old attitude has been swept aside by a surge in prosperity. There is a new level of confidence and boldness in the country’s young urban techies. Read more…

Despite Unrest, The Israeli Tech Ecosystem Is Flourishing

Tech Crunch
Global capital is streaming into Israel, despite the regional instability. The Israeli venture ecosystem has more than doubled in two years. Read more…

Rainforest Rev: The End of the Capitalist Era, And What Comes Next


The End of the Capitalist Era, And What Comes Next

The Huffington Post
A new economic paradigm — the Collaborative Commons — is rising and is already profoundly impacting economic life. In a world in which more things are potentially nearly free and shareable, social capital is going to play a far more significant role than financial capital, and economic life is increasingly going to take place on a Collaborative Commons. Read more here…

What The Research Tells Us About Team Creativity And Innovation

Harvard Business Review
Creativity and innovation require different individual skills and team structures and processes. The idea generation stage is often referred to as divergent thinking or exploration. The implementation stage is often referred to as convergent thinking or exploitation. Read more here…

10 Examples Of Companies With Fantastic Cultures

Great benefits and fun working environment with a dedicated goal to make customers happy all fit in with Zappos’ company culture. Warby Parker has a dedicated team tasked with coming up with fun events and programs to promote community and communication. Read more here…


Moving Saudi Arabia’s Economy Beyond Oil

McKinsey Global Institute
Saudi Arabia is the 19TH largest economy in the world.  It can transform itself from an oil dependent economy through increasing its labor productivity, providing a stronger business environment and support sustainable fiscal management. Read more here…

The Anti Silicon Valley: Start-Up Haven Blooms In Moroccan Paradise

Buzz is building around Taghazout in start-up circles, and it is becoming an international hotspot. After hosting the 2014 Global Entrepreneurship Summit, the government increased its support for entrepreneurs. Read more here…

Europe’s Startup Economy Is In The Best Shape It’s Ever Been And Still Needs Work

Some $10 billion will be invested this year in Europe’s tech startups, up from $7 billion last year. Europe’s tech talent pool is as deep and broad as it has ever been, with 1.6 million professional developers at work (nearly equal to the number in the U.S.). There have been more than 100 European tech IPOs in last 5 years, more than those in the U.S. Read more here…

Rainforest Rev: Does Corporate Culture Really Matter?


The Big Question: Does corporate culture really matter?

Capital Ideas, The University of Chicago Booth School of Business
Corporate culture is the key determinate of the firm’s reputation. Culture acts as an overarching framework for employee behavior. Leaders demonstrate and set examples for others to follow. As the company grows, employee selection and training become the levers to inculcate the company core values. Read more...

Building A Rainforest Firm: Lessons From Silicon Valley

Promote leaders who are “keystones” in leveraging the collaborative potential of your team. They will be brokers of trust and cooperation among everyone else in the firm. Read more…

An Evolutionary Approach to Sustainability Science

Social Evolution Forum
If the strength of selection on groups for resource conservation is stronger than the strength of selection on individuals for greater consumption, costly conservation practices and group-beneficial policies are likely to emerge. Read more…

7 Ways to Nurture Your Creative Soul

The bias of our perspective is rooted in our expertise; it influences the way we see the world. Step into the worlds of your teammates and study their processes and understand their methodology.  It can in turn provide insights on what you can tinker with your own creative process. Read more…

4 Key Ingredients For Creating An Ideas Incubator

Fast Company
Large companies must find a way to make these incubator initiatives feel like meaningful, all-or-nothing endeavors, much like how entrepreneurs feel. To stay on top through innovation, corporations need to adopt the hands-off stance of an investor. Read more…


Engineers Meet Artists: Discover the Startup Ecosystem in Bristol and Bath

The Next Web
There’s a burgeoning startup ecosystem in Bristol and Bath, which form part of the so-called Silicon Gorge in the south west of England. Read more…

Silicon Prairie: Tech Startups Find A Welcoming Home In The Midwest

National Public Radio
One of the secrets to the economic success of Lincoln, a city with one of the lowest unemployment rates in the country, is a surprisingly strong tech startup community that is part of what some in the region are calling the Silicon Prairie. Read more…

These Are the 20 Richest Cities in America

Bloomberg Business
San Jose, San Francisco, and Seattle house more headquarters of the world’s largest technology companies than other places. These cities are also some of the most productive hubs in the U.S. economy. Read more…

Rainforest Rev: Emotions That Make Us More Creative


The Emotions That Make Us More Creative

Harvard Business Review
Recent research suggests that the critical variable influencing one’s scope of attention is not emotional valence (positive vs. negative emotions) but motivational intensity, or how strongly you feel compelled to either approach or avoid something. Read more here.

Rules Of Engagement: How To Tango With Startups

Big companies should create an ecosystem that encompasses partnerships with different types of entities. Also, they should build a portfolio of engagements that represents the different stages of innovation, from generating ideas to buying a technology to acquiring a company. Read more here.

Collaborative Innovation: Transforming Business, Driving Growth

World Economic Forum
European corporates and start-ups must collaborate more and better on innovation if Europe is to remain internationally competitive. Read more here.

How To Hack Creativity

The Next Web
Understanding the way your brain works and regularly training it can help you better exploit your limited creativity reserves and increase them over time. Read more here.


Improving The Mongolian Labor Market And Enhancing Opportunities For Youth

RAND Corporation
Despite a recent slowdown, Mongolia has experienced dramatic economic growth in the 2000s, exceeding global trends. Foreign direct investment, mining, infrastructure spending, and strong fiscal and monetary stimulus measures have driven much of this growth. Read more here.

How Blazing Internet Speeds Helped Chattanooga Shed Its Smokestack Past

Chattanooga is building the largest and fastest Internet networks in the Western Hemisphere. It has attracted billions of dollars in new investment and a flock of entrepreneurs to the city. Read more here.

Getting To Cambridge

The Economist
A marriage of academia, private money and entrepreneurial savvy—exemplifies that of Cambridge. What began with the creation of business parks to host enterprising dons and their doctoral students in the 1970s has grown into the most exciting technology cluster in Europe. Read more here.

Women Make Strides In Business Ownership

The Wall Street Journal 
The growth rate of new businesses remains stalled, but the share of women-owned firms has climbed. Read more here.

Rainforest Rev: Human Capital and Celebrities’ Secret Invesments


The Human Capital Report

World Economic Forum
Talent, not capital, will be the key factor linking innovation, competitiveness and growth in the 21st century. To unlock human capital, governments, business leaders, educational institutions and individuals must each understand better the global talent value chain. Read more here.

Innovation Ecosystems: A New Way of Seeing 

Go Productivity
An ecosystem is a nonlinear complex adaptive system, and is therefore not the sum of its parts. It constantly adapts to changes in the environment – often in unexpected ways. Within the system there are dynamic networks of interconnections, and creation, destruction, survival and evolution. Read more here.

The Celebrities Secretly Funding Silicon Valley’s Next Stars

The Washington Post
A growing number of Hollywood actors and musicians who have turned their attention up north in recent years, pouring their personal wealth into some of Silicon Valley’s hottest startups. Read more here.

What Steve Jobs Was Missing About Innovation

The Globe and Mail
In Simon Sinek’s book, Start with Why, he pushes readers to discover their purpose, cause, or belief that inspires them to do what they do. To better understand the connection between passion, innovation, and a clear “why” is to help you to gain clarity on why your company exists. Read more here.


Adobe Kickbox Gives Employees $1000 Credit Cards And Freedom to Pursue Ideas

Adobe puts the creative process in a box, packed with exercises, suggestions, and a checklist of six steps. Each box contains a set of actions that employees complete to reach the next level.  This makes the concept of innovation a lot less abstract. Read more here.

New Generation of Rwandan Entrepreneurs Offer Tech Solutions to Farmers’ Dilemmas

PBS Newshour
The rise in entrepreneurship in Rwanda was planned. By 2009, entrepreneurship classes were mandatory in secondary school. The government also runs workshops, radio programs and contests aimed at promoting entrepreneurialism. Strong entrepreneurship is equated with patriotism and nation-building. Read more here.

The State Creating the Most Green Jobs Is…Georgia?

Georgia is beating out previous frontrunners like California and Texas.  Georgia is now No. 1 in clean-energy employment growth. Conservatives and left-leaning environmental groups pushed the state legislatures to support third-party solar-panel leasing. Read more here.

A Step Forward for ‘Womenomics’ in Japan

The Wall Street Journal
Japan raised the pressure on companies to hire more women and promote them to management, a key part of Prime Minister Shinzo Abe ’s efforts to revive an economy hobbled by a shrinking population. Read more here.

Rainforest Rev: Bias and Being Nice


Please, Not Another Bias! An Evolutionary Take On Behavioral Economics

Evolving Economics
A large part of our evolved behavior involves our desire to signal important traits and qualities to potential mates, allies and rivals. Our evolved minds are sometimes out-of-sync with our modern environments. An evolutionary lens provides a guide as to what people are looking for in a product. Read more here.

It Pays To Be Nice

The Atlantic
What an organization is a bunch of people trying to do something together. The goal of a business is to get the members of the organization to put the good of the organization ahead of their own personal good. Read more here.

The World Needs A Secular Community Revolution

This View of Life
We’re less religious than ever, lonelier than ever, and the loneliness is making us unhappy and unwell. Solution? Building secular community to provide opportunities for people to establish high-quality social relationships that are intergenerational and diverse.Read more here.

Teamwork Gives Us Added Personbyte

Financial Times
The word “personbyte” describes the amount of knowledge that one person can reasonably know. The way to escape the constraint of the personbyte is to work in larger teams. More complex products require elaborate networks of teamwork and collaboration. Read more here.

My Real-Life Shark Tank: Tips For Winning Startup Pitches

By Victor Hwang, CEO & Co-Founder of T2 Venture Creation, from Forbes
The recent winner of TechCrunch Disrupt’s Startup Battlefield provides tips on how to win startup pitch contests, and tips for judging contests too. Read more here.


From Casino Past To Entrepreneurial Future: Reno Remakes Itself

By Douglas Erwin, a friend and collaborator of T2 Venture Creation, from Kauffman Thoughtbook
EDAWN (Economic Development Agency of Western Nevada)created an entrepreneurial development strategy that leveraged the concepts from Brad Feld’s Startup Communities and Victor Hwang’s The Rainforest: The Secret to Building the Next Silicon Valley. Read more here.

Top Countries & Industries Luring Global Talent: A LinkedIn Study Reveal

New data from LinkedIn shows certain professionals are moving away from countries like India and flowing into places like the United Arab Emirates. Tech and telecom play a prominent role among the most active migration countries. Read more here.

How Europe Is Finally Taking On Silicon Valley

Fast Company
The E.U. is taking legal and regulatory action that would boost local upstarts and rein in U.S. tech giants. The European Commission has proposed a plan to update and unify commercial regulations across Europe. Read more here.

Rainforest Rev: Altruism and Mindsets of Innovation


Does Altruism Exist?

Cooperation, and group-level functional organization that produces cooperation, cannot be explained by selection within groups. It evolves primarily as a result of selection between groups. Read more here.

Naming the Mindsets of Innovation

Stanford Social Innovation Review
Social sector leaders can encourage innovation by fostering three productive mindsets. Read more here.

3 Questions: Economies as computers, products as information

Massachusetts Institute of Technology News
New book argues that economic development is a special case of the growth of information. Read more here.

Empire of the Geeks

The Economist
At its best Silicon Valley is an expression of iconoclastic freedom and creativity. It would be a terrible shame if it became an unpopular and remote manifestation of elitism. Read more here.

The 2015 Global Startup Ecosystem Ranking

Startup Compass
A newly released 2015 Global Startup Ecosystem Ranking is here. Ecosystems have become more interconnected and startup teams have become more international. Read more here.


Styling itself as the ‘Silicon Valley of the East’

Nikkei Asian Review
The establishment of a Free Trade Zone in Penang in the early 1970s has provided attractive incentives to foreign investors. Read more here.

How Did Israel Become a Hub for Innovation?

Though a unique combination of circumstances, culture, and a strong will to succeed, Israel becomes this hub for innovation and entrepreneurship. Read more here.

Denver Job Market Lures Millennials

The Wall Street Journal
Denver has long been a regional hub, with established industries such as oil and telecommunications that leaders have built upon to create thriving sectors such as energy information technology and digital health care. Read more here.

Rainforest Rev: Lean Innovation Management and Nerdopolis


Lean Innovation Management – Making Corporate Innovation Work

Steve Blank blog
The author has been trying to find a unified theory of innovation that allows established companies and government agencies to innovate internally with the speed and urgency of startups. Companies that want to do continuous innovation need to execute their core business model while innovating in parallel. In other words, in an ambidextrous company you need to be able to “chew gum and walk at the same time.” Read more here.

Welcome to Nerdopolis

Capital Ideas, The University of Chicago Booth School of Business
Knowledge workers are reshaping the map of the global economy. The only way to move a city from a bad equilibrium to a good one is with a big push: a coordinated policy that breaks the impasse and simultaneously brings skilled workers, employers, and specialized business services to a new location. Read more here.

A New Powell Memo

Social Evolution Forum
A cooperative effort is required to establish a new economic paradigm that will improve the quality of life for society as a whole, not just a privileged faction. Read more here.

Hey Silicon Valley, joiners are just as important as founders

The Washington Post
Recent studies show that joiners may not have the extreme risk-seeking behavior of a rock star CEO founder, but they are more than willing to head up the key functional roles — especially R&D — that make a start-up great. Read more here.

The Benefits of Mind-Wandering

The Wall Street Journal
Mind-wandering aids decision-making by allowing you to run future-oriented simulations in your head. It’s ideal not just for thinking about possible outcomes but also for thinking about how different outcomes would feel. Read more here.


A Fearless Culture Fuels U.S. Tech Giants

The New York Times
For all of Europe’s advantages, its technology sector lags that of the United States. A dread of failure may be one reason. Read more here.

How Sweden became the startup capital of Europe

The Telegraph
If you played a game on your phone today, listened to music online or video-phoned a friend, chances are you used a Swedish company. Read more here.

Rainforest Rev: Aspen Institute and Innovation


Get to Know the Aspen Institute

Aspen Institute
Two books that really shape our thinking as we build out the Center for Urban Innovation at the Aspen Institute are Victor Hwang’s “The Rainforest,” which explains that innovation is a result of networks and relationships — it’s not a top-down process, and “Searching for Necessity” by a design consultancy called TomorrowToday, which identifies amazing community based innovation work across the country. Read more here.

Innovation That Matters

The “secret sauce” of ecosystem development lies in the creation of effective networks that bring together broad arrays of stakeholders within an industry; facilitate open exchange of ideas; and bridge cultural gaps between different groups to promote effective collaboration. Read more here.

Startup Balance: Finding the Harmony Between Work and Life

Kauffman Foundation
This book illustrates the reality of surviving the entrepreneurial life while trying to find the harmony between the people that love and support them and the dreams they are trying to accomplish. Read more here.

Beyond capitalism and socialism: could a new economic approach save the planet?

The Guardian
To avoid social, environmental and economic collapse, the world needs to move beyond the standard choices of capitalism or socialism. That’s the conclusion of a new report released Wednesday by US think tank Capital Institute. Read more here.


Behind China’s Billion-Dollar Startups: Alumni of Alibaba, Tencent

The Wall Street Journal
A growing number of entrepreneurs who got their start at China’s three leading Internet firms—Alibaba, Tencent Holdings Ltd. and Baidu Inc. —and are now trying their luck at their own ventures. Read more here.

The Fintech Revolution

The Economist
From payments to wealth management, from peer-to-peer lending to crowdfunding, a new generation of startups is taking aim at the heart of the industry—and a pot of revenues that Goldman Sachs estimates is worth $4.7 trillion. Read more here.

In Europe, Fake Jobs Can Have Real Benefits

The New York Times
The fake companies with imagined sales are all part of an elaborate training network that effectively operates as a parallel economic universe. They are used to combat the alarming rise in long-term unemployment while keeping unemployed workers stay current with their job skills. Read more here.


Wold Cup Tech Challenge

June 4th, 2015 at Microsoft in Silicon Valley
Don’t miss the 2nd Annual World Cup Tech Challenge–tickets are 25% off with code WCT25! This year, 25 startups representing 18 countries are competing for the Cup. Get tickets now and secure a front-row seat to the most exciting startup competition of the year. You’ll be able to meet entrepreneurs from all over the world, as well as Silicon Valley VCs and investors; you’ll also have the chance to learn from and be inspired by our keynote speakers, who hail from Singularity University Labs, Google for Entrepreneurs, and Blackbox. Visit http://www.worldcuptech.com/ to get tickets, meet the competing companies (and vote for your favorite), and check out the judges and panelists.