Silicon Valley Then and Now: To Invent The Future, You Must Understand The Past https://medium.com/backchannel/why-silicon-valley-will-continue-to-rule-c0cbb441e22f “You can’t really understand what is going on now without understanding what came before.” Steve Jobs is explaining why, as a young man, he spent so much time with the Silicon Valley entrepreneurs a generation older, men like Robert Noyce, Andy Grove, and Regis McKenna. It’s a beautiful Saturday morning in May, 2003, and I’m sitting next to Jobs on his living room sofa, interviewing him for a book I’m writing. I ask him to tell me more about why he wanted, as he put it, “to smell that second wonderful era of the valley, the semiconductor companies leading into the computer.” Why, I want to know, is it not enough to stand on the shoulders of giants? Why does he want to pick their brains? “It’s like that Schopenhauer quote about the conjurer,” he says. When I look blank, he tells me to wait and then dashes upstairs. He comes down a minute later holding a book and reading aloud: Page | 1 Steve Jobs and Robert Noyce. Courtesy Leslie Berlin. He who lives to see two or three generations is like a man who sits some time in the conjurer’s booth at a fair, and witnesses the performance twice or thrice in succession. The tricks were meant to be seen only once, and when they are no longer a novelty and cease to deceive, their effect is gone. History, Jobs understood, gave him a chance to see — and see through — the conjurer’s tricks before they happened to him, so he would know how to handle them. Flash forward eleven years. It’s 2014, and I am going to see Robert W. Taylor. In 1966, Taylor convinced the Department of Defense to build the ARPANET that eventually formed the core of the Internet. He went on to run the famous Xerox PARC Computer Science Lab that Page | 2 developed the first modern personal computer. For a finishing touch, he led one of the teams at DEC behind the world’s first blazingly fast search engine — three years before Google was founded. Visiting Taylor is like driving into a Silicon Valley time machine. You zip past the venture capital firms on Sand Hill Road, over the 280 freeway, and down a twisty two-lane street that is nearly impassable on weekends, thanks to the packs of lycra-clad cyclists on multi-thousand- dollar bikes raising their cardio thresholds along the steep climbs. A sharp turn and you enter what seems to be another world, wooded and cool, the coastal redwoods dense along the hills. Cell phone signals fade in and out in this part of Woodside, far above Buck’s Restaurant where power deals are negotiated over early-morning cups of coffee. GPS tries valiantly to ascertain a location — and then gives up. When I get to Taylor’s home on a hill overlooking the Valley, he tells me about another visitor who recently took that drive, apparently driven by the same curiosity that Steve Jobs had: Mark Zuckerberg, along with some colleagues at the company he founded, Facebook. “Zuckerberg must have heard about me in some historical sense,” Taylor recalls in his Texas drawl. “He wanted to see what I was all about, I guess.” To invent the future, you must understand the past. I am a historian, and my subject matter is Silicon Valley. So I’m not surprised that Jobs and Zuckerberg both understood that the Valley’s past matters today and that the lessons of history can take innovation further. When I talk to other founders and participants in the area, they also want to hear what happened before. Their questions usually boil down to two: Why did Silicon Valley happen in the first place, and why has it remained at the epicenter of the global tech economy for so long? I think I can answer those questions. First, a definition of terms. When I use the term “Silicon Valley,” I am referring quite specifically to the narrow stretch of the San Francisco Peninsula that is sandwiched between the bay to the east and the Coastal Range to the west. (Yes, Silicon Valley is a physical valley — there are hills on the far side of the bay.) Silicon Valley has traditionally comprised Santa Clara County and the southern tip of San Mateo County. In the Page | 3 past few years, parts of Alameda County and the city of San Francisco can also legitimately be considered satellites of Silicon Valley, or perhaps part of “Greater Silicon Valley.” The name “Silicon Valley,” incidentally, was popularized in 1971 by a hard-drinking, story-chasing, gossip-mongering journalist named Don Hoefler, who wrote for a trade rag called Electronic News. Before, the region was called the “Valley of the Hearts Delight,” renowned for its apricot, plum, cherry and almond orchards. “This was down-home farming, three generations of tranquility, beauty, health, and productivity based on family farms of small acreage but bountiful production,” reminisced Wallace Stegner, the famed Western writer. To see what the Valley looked like then, watch the first few minutes of this wonderful 1948 promotional video for the “Valley of the Heart’s Delight.” Three historical forces — technical, cultural, and financial — created Silicon Valley. Technology On the technical side, in some sense the Valley got lucky. In 1955, one of the inventors of the transistor, William Shockley, moved back to Palo Alto, where he had spent some of his childhood. Shockley was also a brilliant physicist — he would share the Nobel Prize in 1956 — an outstanding teacher, and a terrible entrepreneur and boss. Because he was a brilliant scientist and inventor, Shockley was able to recruit some of the brightest young researchers in the country — Shockley called them “hot minds” — to come work for him 3,000 miles from the research- intensive businesses and laboratories that lined the Eastern Seaboard from Boston to Bell Labs in New Jersey. Because Shockley was an outstanding teacher, he got these young scientists, all but one of whom had never built transistors, to the point that they not only understood the tiny devices but began innovating in the field of semiconductor electronics on their own. Page | 4 And because Shockley was a terrible boss — the sort of boss who posted salaries and subjected his employees to lie-detector tests — many who came to work for him could not wait to get away and work for someone else. That someone else, it turned out, would be themselves. The move by eight of Shockley’s employees to launch their own semiconductor operation called Fairchild Semiconductor in 1957 marked the first significant modern startup company in Silicon Valley. After Fairchild Semiconductor blew apart in the late-1960s, employees launched dozens of new companies (including Intel, National and AMD) that are collectively called the Fairchildren. Page | 5 The Fairchild 8: Gordon Moore, Sheldon Roberts, Eugene Kleiner, Robert Noyce, Victor Grinich, Julius Blank, Jean Hoerni, and Jay Last. Photo courtesy Wayne Miller/Magnum Photos. Page | 6 Equally important for the Valley’s future was the technology that Shockley taught his employees to build: the transistor. Nearly everything that we associate with the modern technology revolution and Silicon Valley can be traced back to the tiny, tiny transistor. Think of the transistor as the grain of sand at the core of the Silicon Valley pearl. The next layer of the pearl appeared when people strung together transistors, along with other discrete electronic components like resistors and capacitors, to make an entire electronic circuit on a single slice of silicon. This new device was called a microchip. Then someone came up with a specialized microchip that could be programmed: the microprocessor. The first pocket calculators were built around these microprocessors. Then someone figured out that it was possible to combine a microprocessor with other components and a screen — that was a computer. People wrote code for those computers to serve as operating systems and software on top of those systems. At some point people began connecting these computers to each other: networking. Then people realized it should be possible to “virtualize” these computers and store their contents off-site in a “cloud,” and it was also possible to search across the information stored in multiple computers. Then the networked computer was shrunk — keeping the key components of screen, keyboard, and pointing device (today a finger) — to build tablets and palm-sized machines called smart phones. Then people began writing apps for those mobile devices … . You get the picture. These changes all kept pace to the metronomic tick-tock of Moore’s Law. The skills learned through building and commercializing one layer of the pearl underpinned and supported the development of the next layer or developments in related industries. Apple, for instance, is a company that people often speak of as sui generis, but Apple Computer’s early key employees had worked at Intel, Atari, or Hewlett-Packard. Apple’s venture capital backers had either backed Fairchild or Intel or worked there. The famous Macintosh, with its user-friendly aspect, graphical-user interface, overlapping windows, and mouse was inspired by a 1979 visit Steve Jobs and a group of engineers paid to XEROX PARC, located in the Stanford Research Park. In other words, Apple was the product of its Silicon Valley environment and technological roots. Page | 7 Culture This brings us to the second force behind the birth of Silicon Valley: culture. When Shockley, his transistor and his recruits arrived in 1955, the valley was still largely agricultural, and the small local industry had a distinctly high-tech (or as they would have said then, “space age”) focus.