ECONOMICS AND TRADE | Achieving growth through open markets
14 May 2008
About This Issue
Inside: stories of technical innovation and entrepreneurial drive
This humble garage, also pictured on the cover of this issue of eJournal USA, may tell us more about the American people than the proud marble monuments that adorn the National Mall in Washington, D.C. In 1938, the garage housed no automobile, but rather the Hewlett-Packard Company, founded by William Hewlett and David Packard with $538 in borrowed capital. The image represents the entrepreneurial zest and individual drive that characterize this nation of achievers, the creativity and practical ingenuity of American entrepreneurs from Benjamin Franklin (bifocals, odometer, lightning rod) to Larry Page and Sergey Brin (Google) who harness the latest technologies to practical — and profitable — uses. Also important is the garage’s address: Palo Alto, California, home to Stanford University and a central point in the famous Silicon Valley, nexus of the semiconductor revolution and no doubt of technological marvels to come.
This eJournal explores the phenomenon that drives uncounted Americans — and now citizens of other nations — to create fledgling “start-up” businesses that explore and exploit the latest developments in high technology. It also investigates the closely related “venture capital” phenomenon. New businesses need money, and often lots of it. How investors match their funds to (hopefully) winning ideas is a big part of the start-up story.
How does one start a high-tech business, and how does one fund it? Joseph Bartlett addresses these questions from the vantage point of a venture capital expert. Amity Shlaes explains the policy decisions that encouraged — and at times discouraged — this venture capital system and the innovation it nourishes. Start-up CEO Cheryl Smith explains the process from the business owner’s perspective, while Ben Casnocha — named by BusinessWeek magazine one of America’s “top young entrepreneurs” — offers words of encouragement to young people to get out there and create businesses of their own. Many high-tech start-ups are founded in that part of northern California we know today as the Silicon Valley. Ashlee Vance explains why. And Richard Florida examines one social consequence of the high-tech revolution: the emergence of a “creative class” that prizes cultural diversity and social tolerance.
Many important start-ups have been founded by immigrant entrepreneurs who arrive in the United States from every corner of the globe. Throughout this eJournal, we profile a number of them.
Venture capitalist Vinod Dham, also known as the father of the Pentium processor, once memorably said: “Living in the Silicon Valley, if you do not do a start-up, then something is wrong with you.” That puts the matter a bit starkly, but Dham does capture the essential drive of millions — Americans and others — who even now are hard at work, if only in the garages of their minds.
— The Editors
