Alternatives to Silicon Valley: Building Your Global Business Anywhere

Lex Research Topics in Corporate Law & Economics Working Paper No. 2015-2

36 Pages Posted: 15 Jul 2015 Last revised: 17 Aug 2015

See all articles by Mark Fenwick

Mark Fenwick

Kyushu University - Graduate School of Law

Erik P. M. Vermeulen

Tilburg University - Department of Business Law; Signify (formerly known as Philips Lighting) - Legal Department; Tilburg Law and Economics Center (TILEC); European Corporate Governance Institute (ECGI); Kyushu University - Graduate School of Law

Date Written: July 14, 2015

Abstract

Entrepreneurs who are driven, ambitious and dream of building a global business that will change the world are going to have to survive the difficult period in the early stage of the life cycle of a company known as the “Valley of Death”. In order to be successful in this challenging task - after all, many businesses will fail at this early stage - they will need to raise a significant amount of money. But this need for money raises a series of daunting questions: “Who should they turn to for investment?”; “What kind of money do they want to attract?”; “When is the right moment to seek investment?”; and, “Where should they locate their company, if their dream is to build a global business?”

This last question - we will refer to it as the “Where question” - is perhaps the most important of all, not least because it will determine the available options for answering the other questions. Research has consistently shown that over the last three decades Silicon Valley has been the place to go. Over recent years, however, this picture has become somewhat blurred. If deal growth is examined, for example, it is clear that more and more high risk venture capital deals are being put together far from California and that the correct answer to the “Where question” is becoming much less obvious. A global business really can begin anywhere.

An important new development is the emergence of a global or “virtual” innovation eco-system. A metaphor for understanding various features of this new phenomenon is that of the Cloud.

Keywords: entrepreneurship, governments, hedge funds, innovation, lawyers, mutual funds, private equity, Silicon Valley, sovereign wealth funds, special economic zones, start-up communities, start-up companies, venture capital, virtual ecosystems

JEL Classification: D20, F60, G38, J40, K20, L22, L26, O30, O38

Suggested Citation

Fenwick, Mark and Vermeulen, Erik P.M., Alternatives to Silicon Valley: Building Your Global Business Anywhere (July 14, 2015). Lex Research Topics in Corporate Law & Economics Working Paper No. 2015-2. Available at SSRN: https://ssrn.com/abstract=2630567 or http://dx.doi.org/10.2139/ssrn.2630567

Mark Fenwick

Kyushu University - Graduate School of Law ( email )

6-19-1 Hakozaki,
Fukuoka
Japan

Erik P.M. Vermeulen (Contact Author)

Tilburg University - Department of Business Law ( email )

Signify (formerly known as Philips Lighting) - Legal Department ( email )

Amstelplein 2
Amsterdam
Netherlands

Tilburg Law and Economics Center (TILEC)

Warandelaan 2
Tilburg, 5000 LE
Netherlands

European Corporate Governance Institute (ECGI) ( email )

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

Kyushu University - Graduate School of Law ( email )

6-19-1, Hakozaki, Higashiku
Fukuoka, 812-8581
Japan

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