The first and last one is easy. First is society and the last is government. Traditionally, we don't like the government even now the vast majority don’t like government to get involved we take the money very happy to take the money but we don't really like government to tell us what to do Silicon Valley is always viewed the government as very far, in Washington. Good, stay there, stay there. Sometimes when they asked me which city in china is more similar to the two Silicon Valley I think which city is very far from Beijing. Because that's our attitude. That’s easy.
The number one is society because it’s the society that creates this different attitude towards technology. Venture capital is a long story and I wish some of my venture capitalists were here so you can hear their version. In the book I write, in my opinion, venture capital has not been a positive force because venture capital tends to come after not before. And it distorts the market when capitalist come and invest in one thousand companies. And then most of these fail, the market crashes a lot of people lose their job it's unfair to blame the dot coms.
Of course, if you have an idea, you get the money. The distortion comes from the fact that venture capitalists tend to be a little stupid they invest in what is popular. Right now, as we speak probably they're investing a lot in artificial intelligence without even understanding. What it is that good or bad some people will tell you it's good because it helps a lot of artificial intelligence companies get started but my opinion is bad actually because it creates too much expectation that would probably not, create bubbles, was creating the bubbles in Silicon Valley.
I don't think you have to blame it on a Steve Jobs and the market and so on. Of course, they were very happy bubble creates bigger nets but you have to blame it on the retail is in my opinion that an eventual capital is a speculator. It is like in China the value of homes goes up a lot, because people start buying ten, twenty homes. Say that with the companies and so my feeling has always been that it was a negative force not a positive force, but again if my friends in the venture capitals were here, they would tell you the opposite.
They would tell you, without our money, Silicon Valley would be nothing and there's also some truth in what they say. I would rank venture capital lower. One thing, two things I mentioned. One is the loss of California there was actually more important than the government in Washington. California has always had laws that are very loose the very, you know, they encourage business in many ways. The most famous is the fact that you can quit Apple and go work for a competitor of Apple. And the law in California tends to protect you, you cannot, of course, you cannot tell the secrets of Apple to another to a competitor but you can work in a very similar project. Yes, and in other states is not true and other countries is defining not true.
So in California, it is always been much easier to quit the company and join the other company that makes a big difference because in silicon value expected if you stay if you worked for the same company for five years, people ask you why it sounds strange it almost sounds like you're not so good. Because if you are good a competitor should offer you money and so most of my friends a change job every two or three years, you meet them after one year or so first question is so you working for now because you expect them to change that's so easy because the loss in California make it easy in other places you have to be careful and also some companies will not hire you because they would be afraid that Apple see what ever so one thing you didn't ask is the loss of California and that make it a little easier to do these things.
And then the other thing you didn't ask well I guess it maybe it's part of society but the bay area always had all these people protesting against technology, That's very important, actually. So we all had the two, almost like you I know you know the split brain the people have this disease where there are two people in one. The bay area is easily little bit like that so some the same place the bay area has people who love technology and it has people who hate technology and both are famous. And so these things create really a dialogue between maximum technology and minimum technology. So you have people who actually say my buy I’ll go live forest literally and they created commune and live in the forest and they are very happy we not technology and then you have all these high tech startups so that actually I see that as very very useful. I think that as a contributing to new ideas.
Yeah even even talents. I was going to say something about talent. I mean, to me talents should be rephrased as immigration because every place in the world has talents. I mean there are no stupid people in the world. In any country is a lot of very intelligent people the big advantage that we have is that you want to come to Silicon Valley. You know, that's a big advantage and as I said that there were young educated people coming from everywhere when I present when I talk about artificial intelligence. I have a slide it's mainly to wake up people but it's an interesting slide. You know I list all the people who invented today artificial intelligence the new artificial intelligence. And for each person I write next to it where it was born you go through the list not one born in the United States.
Deep learning was all invented by people who were born outside the United States but now you think of deep learning at Silicon Valley but they were not born there. So talents are everywhere if you just write talents I put it last because every country has it but if you write immigrants then is very high I mean this power the Silicon Valley has to attract foreigners it's a big contribution.
It's even difficult to quantify how much the United States as a whole as you know is a country of immigrants so in immigrants have always been important. But in California it’s very high, in the Bay Area it’s colossal, it could be ninety percent of the innovation we have come from immigrants, meaning also from other states. Ok, Steve jobs is the exception. He was raised in Silicon Valley but if you look through all the other people almost all of them came from somewhere else so that's a big big powerful thing so it depends, if you just call it talent, it’s the last one if you call it immigrants.
immigrants and then I would say, I would say the laws. So last one is government and that’s sixth, this is fifth. So most important factor for Silicon Valley in my opinion is the society, the culture. And it's a complex culture, a complex society and it’s unique and that's what makes Silicon Valley unique. And that's why it's so difficult to replicate Silicon Valley in other places we don't have another Silicon Valley in the United States.
The second I would say, immigration, in the contribution of immigrants is very important even if some of them some of them don't found companies, they don't become famous like Steve Jobs and Mark Zuckerberg. But if you look at the people who work for them, the engineers, even some of the marketing people some of the people really created the trends. And those are immigrants so I think they are very important.
And then the laws in California were important, because they helped create this attitude toward changing jobs, don't be afraid to fail this. All the things I told you about the society are true also because the laws of California make it easy in some countries if you fail you go to jail. That makes a difference, right?
So number four would be the capital venture capital which was useful for some things, but I think it tends to distort. I think it slows down innovation, actually. Because the money doesn't go into real innovation, but it goes into exploiting innovation making money out of innovation.
And the last one, the government. Government has an indirect role a government so why we take the money from the government if we don't particularly like the government. We don't like to get orders take orders but we like the money the advantage of government money is that its long term. Venture capitals are short term they give you money but then they want to return in two years. So you are forced to abandon their research and try to focus on the pothole founders by the way were very smart at avoiding that problem by any way that's an exception.
In general, venture capital is short-term, so when it very often kills the research. It wants to market what you have now. Government money is long term government is thinking in terms of war. So what do you don’t need to return tomorrow morning. If your research doesn't do anything useful for ten years, it’s fine. Government is thinking at ten years from now, I will have better missiles or better satellites whatever. So that's why we take the money from the government, because it's like a long-term venture capital. But otherwise, we don't particularly like it.
And I really don't think government was, it's not a matter of liking not liking. Sometimes we like it I mean Silicon Valley obviously liked Obama, dislike Trump. Everybody knows this but it's just that government did not plan Silicon Valley. So that's why ranks last. There wasn’t a day when somebody told the president there is a place called Silicon Valley or there was a day when the President was watching TV and ask her what is this Silicon Valley. It was not planned by him. So, in this sense, the government did not have a direct influence on Silicon Valley.
In fact, the US government invested in many technology areas in the United States and put more money in other areas. So they never said number one is San Francisco Bay Area, never! Actually, I think the opposite I think there are many places in the United States that offer more benefits to high tech, in Seattle sets lower taxes. I think almost everybody is lower taxes in California to Texas. There's many states they really encourage Silicon Valley companies to move out of the Bay Area. And in some cases, that has happened. In Intel has a big factory is I think in Oregon whatever and of course it is well known. Many countries have better laws.
Apple smart phones are not made in the bay area the made in China or Taiwan. and so on somebody was telling me that the Bay Area employs millions of people many more than we think. Why? Because you have to count also the ones that are outside of the United States. So I think, in general, government has not helped Silicon Valley much. Other governments helped their sort of Silicon Valley more. Where the government has helped is indirectly. Again, indirectly.
Bill Clinton’s vice president Al Gore was influential and decided that the internet should become a commercial network. The internet was invented as a government network for the military and for research. So when, I think, in 1992, maybe it wasn't him but anyway that the internet should become a commercial network that was very important. That's why we had the dot com. Before that it was difficult to make any. Any commercial activity on the internet was discouraged if not illegal so there was very important there was also a law in the 60s or 70s when the government decided it will help any venture capitalist was willing to invest in a high technology because Silicon Valley was one of the beneficiaries. I see, but these decisions were not about Silicon Valley they were about the whole United States and whine why Silicon Valley had bigger returns or benefits from these decisions on that that's because Silicon Valley was special enough but those decisions by the government were not specifically to help Silicon Valley where to help their whole country.