Which Place Has The Best Innovation Ecosystem - Boston or Silicon Valley?

Lately I have been hearing quite a bit of discussion on whether Boston or Silicon Valley is the better location for start-ups and innovation.  In my mind, there are three reasons why Boston is better and three reasons why it is not.  

The three reasons why Boston is better are:

​1)  EDUCATIONAL ECOSYSTEM - Although Silicon Valley is located next to Stanford University and University of California, Berkeley is nearby, Boston has more, and comparable, if not better, universities.  Among the top institutions in or near Boston are: MIT, Harvard University, Babson College, Wellesley College, Worcester Polytechnic Institute, and University of Massachusetts, Amherst.  These are considered some of the best universities in the world in many areas including robotics, engineering, and sciences.  They attract some of the brightest and best from around the globe and its students, alumni, and faculty have created leading-edge companies including Facebook, iRobot, and EMC.

2)  MASSCHALLENGE AND SUPPORT FROM THE COMMONWEALTH - Massachusetts did an excellent job under its former Governor, Deval Patrick, to support and develop a non-profit organization called MassChallenge.  Founded in 2010 by John Harthorne, it has awarded millions of dollars in support to start-ups and has created a fantastic opportunity for companies and legal and accounting firms to be involved at an early stage of a company's life.  It has become a model for many incubators and accelerators around the world.

3)  BOSTON AND THE INNOVATION DISTRICT - Boston's previous Mayor, Thomas Menino (RIP), created and relentlessly promoted the Innovation District.  This area, formerly a downtrodden section of Boston's Harbor waterfront, has become a lively and dynamic area to live and work for start-up companies and its employees.  It has become a literal innovation hub and continues to attract and to concentrate start-ups in this city.

However, there are three reasons why Boston is at a disadvantage relative to Silicon Valley in innovation.  These are:

1)  CAPITAL FUNDING AND VENTURE CAPITALIST FIRMS - Silicon Valley has a very good ecosystem of world-class VC firms including Andreessen Horowitz and Accel Partners.  These and others provide start-ups with access to funding unmatched by any other location in the world.  This has caused start-ups like Facebook, which was originally founded in Boston as previously mentioned, to relocate.

2)  THE CURRENT BOSTON MAYOR AND MASSACHUSETTS GOVERNOR - Governor Patrick and Mayor Menino worked very closely together and as a team to create an innovative environment in Boston.  Unfortunately, this does not seem to be the case with the new Governor, Charlie Baker, or the new Mayor, Marty Walsh.  Governor Baker, whose background is in Health Care management, seems to be focused on only this area of innovation.  Marty Walsh, in the meantime, does not seem to understand the importance of innovation to the area.  Although he has been credited with the move of GE to Boston, the reality is that this process was started by Mayor Menino and Governor Patrick.  Additionally, one can argue that GE is moving to Boston PRECISELY because it has been attracted by the environment created here by Patrick and Menino.  It will be interesting to see if Walsh and Baker start working more closely as a team and start focusing more on innovation in the future.

3)  CULTURE - Although Boston has made great strides in this area, there are still pockets in the city where a traditional, provincial mentality persists.  This mentality creates a distrust towards new arrivals in the area and, consequently, to innovative approaches and to a global mindset.  Additionally, the media that covers innovation, particularly Boston Globe journalists including Scott Kirsner, have this very provincial focus and provide biased coverage.  They spend their time and effort celebrating Boston companies' successes, but never pursue truly investigative reporting when problems surface, such as the recent sexual misconduct allegations at Hubspot.

Hopefully, these issues can be addressed by the current state, city, and journalistic leadership, since Boston is truly an exceptional city that will need to continue to rely on innovation for its growth and success.​

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Please do not hesitate to call me at 1 (617) 391-0347 or e-mail me at mariocastaneda@bluesailconsulting.com if you would like to find out more about Blue Ocean Strategy, the key innovation and implementation process we use at Blue Sail Consulting.