Hangry for innovation, much? Just read that even McDonalds has an incubator for digital products now – I mean who DOESN’T have a secret (or not so secret lab) around these there parts. And the reasons are usually the same:
- The talent is here. We love it here and we don’t want to leave! But seriously, its not just that – we get that all of these companies want to drink deeply of the magic innovation potion which is Silicon Valley, but at the same time, most likely these companies are going to have a tough time recruiting people to join – even the most innovative of the groups? Why you ask? Well, there is no startup style huge upside to working for say a big bank, a big telco, or someone like McDonalds. Where are the massive stock options? Where is the huge pop which will turn me into an internet millionaire (or billionaire nowadays). Its not there. But you and I both know that that kind of success if fleeting and very rare – you’d more likely be struck by lightning than become an overnight billionaire. On the flip side, however, I’ve now worked in two environments like that, and I have to say that not being worried about your next paycheck (or your rent) is a pretty good incentive. You can still do very cool stuff, but you don’t have to worry so much about the whole thing going belly up (you do, however need to worry about cutbacks, especially if your company considers innovation marketing and not true innovation)
- Being up to speed on the latest tech is no longer a nice-to-have, but totally essential. There is a growing disconnect between customers and corporates – those corporates are literally aging out of their markets and new startups and other upstarts are eating up that market share. This happens in the tech space (who under 40 uses AOL? who dates on Match.com when they can use Tinder?) and is happening regularly in other spaces – why open an account at your parents bank when you can use stuff like Simple? Why go to McDonalds when you can eat cooler things at food trucks? Like it or not (take that, all of those other “Silicons” out there) this is where it all starts. So if you want to know what’s really next, you need to be here.
- It’s marketing! All of your advisers, investors and customers will be impressed that you actually have an incubator (or lab, or accelerator) in Silicon Valley, and your stock price will shoot up. In fact, simply announcing that you are planning to launch an incubator in Silicon Valley will probably knock it up by a few percentage points. But then you’ll need to build one!
It’s not easy, but once you have an incubator set up here, you’ll reap the rewards of interesting new ideas and products that you could develop in the digital space, which you may (or may not) have been able to come up with on your own.
If you ARE thinking about setting one up, let me know. I can tell you where you should and shouldn’t put it. Like the article below says, you can get some great tax benefits from setting up in that area of San Francisco. So the city is good. As is Palo Alto. But that’s about it. Anywhere else and people from outside the Bay Area are like “You’re setting up a lab where??”.
Like for example, Colma.
The fast food joint with over 300 billion served just opened shop in San Francisco’s Tenderloin neighborhood. The twist is they’re making digital products, not hamburgers.
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