M is for MIP and, by extension, the entire Politecnico di Milano ecosystem, including the business school, the faculty of engineering, design and architecture, the business incubator and innovation district, with its entire industrial sector connected; it constitutes a seat of excellence and a hope that Italy and Milan increasingly are, and will continue to be, an economic and innovation engine for the country and for the whole of Europe.
N is for Napa Valley, Silicon Valley’s wine region, which has become the absolute hub of technology that it is today also because of its mild climate and the beauty of the landscape, the quality of the food (on which subject there is plenty to discuss) and the openness of the people.
O is for Call Option, i.e. the possibility that investors can reserve the right to purchase a company’s shares at a certain price within a fixed time frame. Convertible notes are one of the most classic forms of startup financing by ventures, a debt that can become equity under certain conditions. To understand the investors, startuppers must familiarize themselves with terms such as vesting, common stock and preferred stock, cap table, liquidation preference, bad leaver, etc. Best get started right away.
P is for Plug and Play, Silicon Valley’s accelerator, which has given rise to several companies of the caliber of Dropbox, to mention only the best known. Watching some Plug and Play pitches, seeing the strength of the environment and getting to know more about the mechanisms of selection, incubation, acceleration and growth, right up to the exit, all helps to understand the complex and tendentially different route which Italian incubators and accelerators may take, for obvious economic, financial and technological reasons; they must, in any case, act within a European context. For those who wish to bring their own company to the United States, the door is open in theory ̶ but it is necessary to choose the right moment to do so, and consider sufficiently one’s genuine strengths. It does not make sense, for example, to approach Plug & Play from Italy with an idea or a small prototype in search of investment. It is better to arrive after the first round in Europe and the first commercial successes in your own country. Some pitches, like that of Waplog (see below) only serve to prove the point.
Q is for Quantum Computing. Our visit ended with an amazing visit to SLAC, as mentioned above. Many topics were covered, including quantum computing, which, according to Enzo Carrone, is technology that is in the same state as artificial intelligence was 20 years ago. Having said that, technology sometimes progresses in leaps and bounds, so who knows whether its development will happen more quickly than expected. The explanation of quantum computing was fascinating. Carrone himself admitted that it is difficult to understand it fully, even for many scientists. We are relieved to hear it.
R is for Risk. Common understanding has it that Americans are prone to risk-taking and that it is this propensity for risk which motivates business angels, venture capitalists and entrepreneurs. However, according to Ron Weisstein, entrepreneurs hate risk and are very good at calculating it. In fact, Americans plan everything (they are already thinking about university in kindergarten). They take risk into consideration and work towards limiting its effects. We Italians say that we don’t like risk, but in reality we can’t be bothered to work out its effects. This is why we like the past – in those days, there weren’t any risks.
S is for SLAC, Stanford University’s particle accelerator. Here, you really enter into another world – a world where the infinitely large and the infinitely small are joined, where quantum phenomena and the behavior of elementary particles are studied. Enzo Carrone, the Italian who heads up the accelerator’s IT systems that have to manage the impressive amounts of data produced by the accelerator at a frequency which is difficult even just to imagine, reminded us of the love of science for its own sake, of study for the pleasure of knowing. At SLAC, neither weapons nor energy are produced. They study how matter is formed and how life comes about. This is knowledge, pure and simple. The perfect conclusion to our journey.
T is for Tim Berners Lee, who can also be seen as an intruder in a certain sense, because he has nothing to do with Silicon Valley. However, he remains the father of the World Wide Web, having developed the first hypertextual communications between clients and servers, thereby changing the history of technology and of the whole world. The decision not to patent it and to make it available to all has determined the success of the technology and its rapid spread. Who knows whether the story might have been different if it had been in the hands of a greedier person? We know for certain that Berners Lee himself dreamt of a web different from what we have now, something more open, more equal, and freer.
U is for University of Santa Clara, the private university founded by the Jesuits in the Bay Area town of the same name, where we spent our first three days, sharing in some wonderful lessons on digital marketing, business plans, behavioral finance, various case histories, and, obviously, investments with Business Angels of the caliber of Patrick Guerra and Ron Weissman, President of Band of Angels, one of the main Angel Investor groups as well as the oldest in Silicon Valley.
V is for Valley, Silicon Valley of course. An epithet for a place which, since the 1970s, has seen a concentration of capital, business and technology, all with a strong focus on electronics and computers, but whose foundations have a much longer history, one which permeates the whole of the twentieth century, made up of technology companies, university laboratories and venture capital. It is precisely this history of innovation which creates the entrepreneurial, technological and innovative mindset of Silicon Valley and the Bay Area, something which it is so difficult to export elsewhere.
W is for Waplog, one of the startups that pitched to Plug & Play, a perfect example of what is meant here by startup and acceleration. The Turkish dating app in fact already boasted 3.5 million users and a $2.5 m turnover in 2017, and is now looking more for commercial partnerships than investment.
X is for Space X, Elon Musk’s latest (crazy?) venture, i.e. the successful launch into space of a Tesla Roadster via the Falcon Heavy rocket system, in which, incredibly, two of the launch boosters returned to ground and gently made a vertical landing, making them reusable for future launches. This, clearly, opens up new and unexpected hopes for the future of space travel. Meanwhile, a Tesla is floating in a void, orbiting Mars.
Y is for Yahoo, till a few years ago one of the giants of digital industry, that reminds us how fast has become innovation in the latest 15 to 20 years.
Z is for Zuckerberg, Mark, obviously. Facebook, along with Amazon, Apple and Google, is obviously one of the undisputed myths in the Bay Area and beyond, even if Facebook originated on the East Coast. Even if it is a little tarnished by the privacy issue (just recently, in fact, we have seen the resignation of the CEO of Whatsapp and a member of the board of Facebook, Jan Koum), the myth of the social network that becomes a unicorn is still very strong, as is demonstrated by the numerous attempts to imitate it, also seen during pitching sessions at Pitch Plug & Play.
No lesson has been learned, nor any conclusion drawn; maybe we can simply learn from their enthusiasm and from the energy that such a place transmits, even to those who just pass through for a short while.