In his amazing book AI Superpowers: China, Silicon Valley, and the New World Order, author and one of the world’s most respected experts on AI and China, Kai-Fu Lee, reveals that China has suddenly caught up to the US at an astonishingly rapid and unexpected pace.
One of the brilliant things he does in the book in supporting his assertion is to compare and contrast entrepreneurs in Silicon Valley and entrepreneurs in China, Shenzhen.
So what are the similarities and differences?
Silicon Valley entrepreneurs he says, prefers to code the clean part, that is, the App part but leaves other companies to do the ground work and production. Their motivation is how to do I build this innovative App that will be change the world. Their mantra being leaving a dent in the universe.
Chinese entrepreneurs are ultra competitive, as whatever is new is quickly copied. These entrepreneurs therefore need to constantly evolve to keep their clients.
But he goes deeper to explain the differences between Silicon Valley entrepreneurs and Chinese entrepreneurs by looking at what I would consider as foundations.
Silicon Valley entrepreneurs are third or fourth generation entrepreneurs.
These entrepreneurs comes from family backgrounds where their parents were doing well either as entrepreneurs or successful professionals.
This reminds me of what Chris Rock says in his comedy Shoot The Messenger, when he talks about his neighbors he says:
In my neighborhood, there are four Black people. Hundreds of houses, four Black people. Who are these Black people? Well, there’s me, Mary J. Blige, Jay-Z and Eddie Murphy. Only Black people in the whole neighborhood. So let’s break it down, let’s break it down: me, I’m a decent comedian. I’m a’ight. Mary J. Blige, one of the greatest R&B singers to ever walk the Earth. Jay-Z, one of the greatest rappers to ever live. Eddie Murphy, one of the funniest actors to ever, ever do it. Do you know what the White man who lives next door to me does for a living? He’s a f**king dentist! He ain’t the best dentist in the world…he ain’t going to the Dental Hall of Fame…he don’t get plaques for getting rid of plaque. He’s just a yank-your-tooth-out dentist. See, the Black man gotta fly to get to somethin’ the White man can walk to!
There are a couple of ways to look at what Chris says. Here he was referring to the fact that you need to work twice as hard to achieve certain things.
A subtle detail that I picked up, is that there are many people, in the USA who are wealthy. There is a fairly substantial middle to upper class that has built sizable wealth. They are not known and hardly make headlines.
This is important. It is important because this says that the young generation of Silicon Valley entrepreneurs are from a generation of middle to up-class backgrounds.
Silicon Valley’s ancestors are giants like Henry Ford, Edison, Wright Brothers etc. These is a generation of entrepreneurs that started thinking “go big or go home” even before Silicon Valley was born.
Their innovations went global and changed how we live, travel and do things. These are historical examples of “Going Big.”
Silicon Valley is a product borne out of a generation that has passed the poverty line long time ago.
The Alpine New Jersey dentist that Chris refers to is an example of the middle class that have wealth.
Let’s take a couple of examples:
In one of the amazing documentaries called Becoming Warren Buffett [please check it out], Warren Buffett’s father, Homan Buffett was an American businessman, investor, and politician.
Bill Gates’s parents, His father was a prominent lawyer, and his mother served on the board of directors for First Interstate BancSystem and the United Way of America.
Steve Jobs’s and Steve Wozniak may not come from wealthy backgrounds, but their families were middle class families.
In general terms, Silicon Valley entrepreneurs have an advantage that many other countries trying to emulate them don’t have.
Silicon Valley entrepreneurs have a solid foundation of an entrepreneurship culture that started after the World War II.
These young generation have a fairly good and supportive family backgrounds, and a supportive government to entrepreneurship.
Foundation, and background has shaped Silicon Valley to be this mecca of ideas, innovation and entrepreneurship.
There are a number of venture funders, angel investors because the previous generation has made that wealth and are now using it to support the coming generation.
Warren Buffet was supported and mentored by his father, Howard Buffett. As a result Warren Buffet is a billionaire and he uses his funds to support and invest in other businesses.
You can say the same about Bill Gates etc.
And I’m sure there are plenty of other unknown entrepreneurs who have been funded by previous generations of wealthy entrepreneurs and professionals and are now using their wealth to fund and support the next generation of entrepreneurs.
Silicon Valley is three or four generations in the making.
The first generation being those of Ford, Edison, Wright etc.
The second generation being those of Buffett, Gates, Bezos etc,
The third generation being Zuckerberg, Page and Brin, founders of AirBnB, Uber, etc.
It is important to build a legacy of generational wealth that will hand over the baton to the next generation to build and improve from where the previous generation left.
Entrepreneurship culture, support, funding, thinking big, embracing failure as a way to success are important yardsticks that should be embraced in order to build a thriving entrepreneurship economy.
Yes there are plenty of rag-to-riches stories in the USA. These stories are possible because the environment is ripe enough to take allow ideas and entrepreneurs to thrive.
Back to Kai-Fu Lee, what does he mean when he says that China has caught up to the US when it comes to AI?
In the next article, I will talk about China’s entrepreneurs and their generations. I will also look at what all this means for entrepreneurs in Africa and what we can learn from all this.