To create a healthy startup ecosystem, you need predators.That’s why it can feel rough in Silicon Valley when you’re running a startup. Like you’re swimming with sharks.
“VCs, maybe are like predatory sharks, but they also provide the nutrients that prime the pump,” Eric Berlow, a University of California at Berkeley ecologist, and founder of Tru North Labs.
“If they were just ‘consuming’ startups and not ‘feeding them’, then there would be no startups.”
Berlow is working with Intel to map the ecosystem of open data, and plans to use the results to find out how to empower entrepreneurs. He likens the system to coral reef, which need coral to make the structure that everything else depends on.
“The rich ecosystem we have here is also not just from VC money, but also from intellectual capital that can be remixed as people leave one startup and move to another. But the basic ‘energy source’ provided by VCs is fundamental to enriching that ecosystem and creating a structural foundation for other species. I guess that is harder to create. Of course they benefit in return from litter that falls back to the forest floor in the form of profits,” he added.
“In a complex system, interactions are not random,” says Sean Gourley, co-founder of data analysis startup Quid. “The predator-prey relationship is critical to that, not just competition,” he added, referring to the latest paper published in leading scientific journal Nature, which overturns a classic model of ecological stability.
As countries like Singapore and Chile are trying to recreate it, it’s important to know that it’s not just about building business parks. It’s about creating a healthy ecosystem. That means allowing for sharks.