“Banks are terrified that Amazon will be a formal bank”

“Banks are terrified that Amazon will be a formal bank,” Deborah Perry Piscione - Silicon Valley entrepreneur and author of Silicon Valley Whispers - told her audience at an event at the London School of Economics. “Amazon knows how its sellers are doing at any given moment at any given day.” She said that applying for a loan with them, therefore, could happen in just six questions. 

Piscione spent the early years of her career working in national politics and the media in the US, reaching both Capitol Hill and the Whitehouse. On moving to Silicon Valley, at a time when Google was just starting to take shape and Zuckerberg was merely a topic of conversation, she found a culture quite different to the corporate world she was used to. “In Washington, we were indoctrinated into this cult that you withhold information and don’t share it,” she told an audience of students and entrepreneurs at LSE. 

“Silicon Valley was a land completely of the unknown. It took me a long time to realise what made this place so unbelievably unique. It is incredibly open and you have to get used to information sharing - often sharing with direct competitors because they can help validate your platform or product.” 

In her book, Piscione discusses what makes the culture of Silicon Valley so different. She said it’s the kind of place that can take a 23-year-old Mark Zuckerberg seriously because, unlike the hierarchies of Washington or London, people there don’t care about your age, gender or the colour of your skin. “The perception is that you’re smart and what you’re building is growing really quickly.” 

Unlimited vacation and intropreneurialsm 

She highlighted Google’s Campus, where you can get a haircut, see a doctor and even get your car’s oil changed, as an example to other businesses around the world. “So you’re not thinking about all those other tasks that bog you down on a daily basis. Netflix gives its employees unlimited vacation time. How do you motivate people based on valuing them?” 

There is also a culture of intropreneurialism, exemplified with the story of Youtube, where its founders were working at PayPal during the day and then on the platform, which started out life as a dating site, at night. And, unlike in Europe, people are allowed to fail. In fact, it might mean they are taken more seriously. She added that there is nothing more important than what is going on in HR. Focusing on people makes a “greater difference between success and failure overall.” 

Comparing Silicon Valley to London, and not without highlighting the better weather and outdoors lifestyle, she said: “Traffic in London has just gotten worse and worse.” She suggests scattering work hours around rush hour to ensure staff are less stressed and so more creative. 

The Valley’s close links with Stanford, which was founded in the 19th century with a commitment to ensure that students, faculty and professors had a connection with the local community, as well the university’s great support for the next generation, have set it apart. The heritage of VCs, the opportunity to build relationship and the supporting infrastructure, likewise. “VCs do everything possible to make that entrepreneur a success.” But its bubble-based economy, Piscione said, tends towards get rich quick rather than value creation which means: “VCs have huge pressure on them to get a quick ROI.” She said she believes platforms like Kickstarter are changing the funding game but highlighted that Silicon Valley has the support system, the networks and the people to make it more likely that a business can succeed. 

Failing national education 

But, while the Ivy League prospers, she said that primary and secondary education, as in the UK, is not doing a great job of preparing its young people for the jobs of the 21st century. California is 48th out of 50 states in terms of spending per pupil. “I’m not sure Silicon Valley has the answer on that front.” 

An audience member highlighted the latest draft of the national curriculum, which will now prioritise advanced IT from an early age. “Computing is not even the future, it’s the here and now. There has been a massive shift in the economy but the education is not giving kids, particularly girls, exposure to STEM subjects. It takes effort and really thinking outside of the box in not continuing to do things you’ve done over the last 50 years, but asking what are you going to do over the next 50 years.” 

She highlighted that PayPal founder Peter Thiel has now started his own fellowship programme, which encourages young people to opt-out of college. On the issue of working visas, she added:  “We certainly have to stop educating people at MIT, Harvard and Stanford and then sending them back home.” 

IP issues 

Asked about growing concerns around intellectual property, Piscione highlighted that Cisco spent $59m (£39.7m) last year defending their patents from “patent trolls” and suggested the need for a new international governing body on this. While many complain that the stealing only goes one way, she also pointed out that eBay “kind of copied a company out of China. Who takes it on, I don’t know – that’s got to be the conversation and the dialogue.” 

Will Apple really have the next new new thing? 

Asked about the future of some of Silicon Valley’s most prominent companies, she said: “There’s lots of conversation in Silicon Valley around will Apple have that next generation – what that new new thing is?” On the current ubiquity of services like Facebook and Google, she said: “You can’t imagine it being in your life - I just got a smartphone not long ago - you continue to resist and then can’t imagine life without it. But there will definitely be something else after Facebook and twitter – and soon.” 

Piscione questioned how much tech we really need, and whether younger generations will suffer from burnout, although she did highlight support from some in Silicon Valley towards biotech. She also warned against focusing on whether it’s web 2.0 or mobile: “because they’re all in there, we now need to look to continue to diversify our economy.”

Written for Mobile Marketing Magazine and published here:
http://www.mobilemarketingmagazine.com/content/%E2%80%9Cbanks-are-terrified-amazon-will-be-formal-bank%E2%80%9D#Q1zC3BL6d06YlRTA.99