A Strategic Overview of the Silicon Valley Ecosystem: Towards Effectively “Harnessing” Silicon Valley

This report provides an overview of the Silicon Valley ecosystem. It draws upon existing scholarship and original insights to derive a picture that is only partially well-known in Japan. Characteristics such as the critical role of large firms for the startup firm ecosystem, the role of Japanese firms in creating the US firms’ “open innovation” paradigm, and the severe lack of local government coordination in providing public transportation creating opportunities for disruptive startups such as Uber, are all aspects of Silicon Valley that are not well-known in Japan. This report also delves into industry-university ties in the crucial research universities of Stanford and University of California Berkeley, highlighting the multifaceted and bidirectional interactions between universities and industry that are often not captured by the common “technology licensing office”-centered view. In the final section, this report briefly reviews a representative set of challenges often cited by large Japanese firms attempting to make use of the Silicon Valley ecosystem, concluding by suggesting areas for further research.