Much later the name Silicon Valley was invented in the seventies by journalists, and only basically the apple IPO is when people start paying attention, and until then there was no, there was no interest really what was going on there. So studying the society explains what is different about Silicon Valley. It was an area where different ideas were welcome and if frida in what differentiates poetry in painting in film or in accepting gays, whatever, and in technology. So I realized that technology is one just one of the things that the bay area does differently, but there are many, and technologies is one. So that started explaining the things, why people are different at work. People go to the garage , why the garage?
If you go back to the fifties and the sixties in the seventies all those writers and artists politicians now there were so many people from different backgrounds they were living in very humble places, they were not working for big corporations, they were not working for the government, they were just independent, and they had the stranger ideas, strange projects. Most of them failed there was nothing wrong failing, so if you start thinking about the people who live there, you realize that it's exactly what we say about silicon valley, the garage. It's ok to fail, it's okay to have a crazy idea, impossible idea, you know. San Francisco was famous because young people wanted to change the world. Silicon Valley changed the world. Of course the people wanted to change the world in the sixties, mostly wanted peace and love, they were dreaming with the deal world, so it was a different meaning. But the spirit was “I want to change the world” . The spirit in most of the world was, I want a safe job, I want a salary, I work from eight to five, my boss tells me what to do and I'm very happy, I go home to family.
San Francisco? Totally different idea. I don't want the boss I don't want a safe job, I want to do something really stupid and if I am poor for the rest of my life, okay, my friends will like me. Everything that we say about silicon valley today was already there, it just was not about technology, was something else. The other thing that is special today about silicon valley is that young educated people want to live there, right, it it's difficult to find somebody was born in the San Francisco bay area, so many immigrants from other states of the United States or from the rest of the world. Immigration is about poor families look at their refuges today in Europe coming from Syria in Africa their families their poor families they move because they are poor they don't have jobs they don't have food. There is a war same with the illegal immigrants in the united states, mostly men but men with families they need to feed their families, and they are poor they are not educated, that's the typical immigrant. I'm sure also in China this is typical. Who wants to move somewhere else? Poor family, they need to find jobs, food and so on. Well guess what, the Bay area was always a place where young educated people want to move.
A very different, it was always a different kind of immigration because the young people, especially college kids like the idea of going to a place where they are not expected to live the traditional life they go there and something different and is so much fun and you know, I'm free, this sense of freedom, all their people know that you pay a price for freedom. You don't have a safe job, where is your salary? Where is your home? Young people they just want this feeling of freedom and so already in the sixties, thousands of young educated people moving to the bay area. Today you see the Silicon Valley and you explain it very easily, Silicon Valley, of course they want to become billionaires but actually that kind of immigration was already there. So it's another way to realize that there was something in the society there was attracting people, because if you just wanted to have money, you could have, you know, found a better job, safer job in New York.
The people who move to San Francisco were not poor, they did not need to move there. They were from a middle class family and they were going to college which means you stay in college get your degree you go you find a job, a good job. There was no need to move to the San Francisco bay area. But there was a sense was already attracting young people because of the different way of thinking, and today people go to Silicon Valley, the reason changed a little bit, because today people go to Silicon Valley also because they want a job with Google Apple and so on.
But hopefully they are still thousands of young people who go there just because they see a place where people think differently, and for young people that inspiration and you have an education and the service bay area you can use it to create something new. In other places you can use it to obey your boss, so that's always been the big difference, the way you work in Silicon Valley and other places. In other places your job your typical job is the boss tells you what to do, Silicon Valley is a place where you use your education to create something new, and people would not be shocked, you know, what, you don't want the job in the big corporation?
Now I want to try this new thing, that's ok. Today is even too easy because today they also give you a lot of money in now there's all these venture capitalists who are always looking for new ideas. But you go back, you have to go back to nineteen sixty nineteen seventy, it was not so easy because all these venture capitalists did not exist. But the society was welcoming. The society was saying, ok you have a new idea, have a try, if it doesn't work, well, you'll be poor. So what? A lot of people chose to live in poor neighborhoods you know， but to be free to do what they wanted.
Even when I came to Silicon Valley in nineteen eighty three, starting a company was a big sacrifice, now starting a company means you quit your job and you really work in a garage with no salary, and the vast majority failed. Of course today is getting too easy because today there's so much venture capital. In fact the start ups they get a lot of money in my opinion, they don't have a good idea, but there's so much money now it's become much easier, right?
But if you want to explain how we got to twenty seventeen ,you have to realize what happened in nineteen seventy seven ,what happened forty years ago? How did this model develop? Why this model worked so well? What was the value of this model because now a lot of people around the world are trying to copy this model, but you will not copy it very easily of course. Risk, the first thing is risk. I mean who was taking the biggest risk with new technology? Not the big corporations, big corporations don't like risk. Big corporations introduce a product and they introduce another product that is similar a little different, same type of application, same customers, you know. For example, if the customer is NASA they keep thinking of selling to NASA if the customer is boring the keep thinking of selling to buying.
Big corporations don't really like risk but all these crazy people in San Frasicco, for them risk is normal. So they they took more risks all the time, all the time, all the time. Steve Woznia, when he built the first apple he had the zero, zero guarantee that this would become a product, zero. Steve Jobs was more of a businessman okay, but even Steve Jobs, if you look at the pictures, he had the long hair. I asked somebody who met Steve Jobs when he was young, so what was your first impression of Steve Jobs and he said he smelled so bad. These people were not trying to have a regular job, right, they were taking a risk. Okay, let's try this thing and see what happens.
So everything I told you about the society explains why these people were so willing to take a risk and because they were willing to take a risk then Silicon Valley did something different with technology. The rest of the world didn't do that, the rest of the world was interested in selling a one million transistors. What do you do with the transistor? I don't care, I just sell them, make them in a big factory. Silicon Valley, this young people look at the transistor, start to think what can I do with this thing? So they were willing to take a risk, they were willing to use their ideas, so that society was encouraging them to experiment them. Actually today we look at the society and realize it was a huge laboratory, you know, the biggest laboratory at the time was Bell Lab, maybe that one thousand people two thousand when the bay area had one million people, you know, and a lot of them were motivated to try something differently.
So then the official history of Silicon Valley is that you have one professor at Stanford who encourages students to start their company. Fred Terman had a number of students, the most famous are Hewlett and Packard, he encouraged them to start their own company. Then William Shockley was one of the inventors of the transistor and decided to move to Palo Alto. Why? Because his mother was sick. He then hired a few engineers, and his engineers started Fair Child, and some of the engineers of Fair Child started Intel, and started many other semiconductor companies. This is all true. But the question you have to ask is why it didn't happen in New York, why did not happen in Germany?