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What is the magic dust that makes Silicon Valley startups so successful?

Joel Watson

Huddle co-founder and CMO Alastair Mitchell explains to Hot Topics how Silicon Valley helps to grow startups.

You’ve all seen the pictures: Google’s headquarters with its giant slide, games rooms and new-age décor, all the employees smiling as they make global decisions over a post-lunch game of pool.

You’d be forgiven for thinking that all you need to run a billion dollar business in Silicon Valley are some hipsters and a quirky interior decorator. But behind the easy-going exterior, there’s more than one nose to the Millstone.

Alastair Mitchell, Founder and CMO of content sharing giant Huddle, tells Editor of Hot Topics, Tom Lytton-Dickie: “The genius of sitting around is they make it look like they’re not executing at all.”

“They’re all having fun and it’s all magic, but actually, there’s an enormous amount of hard work and incredible commercial thinking, very clever people. Combine that with a lot of money, and that’s what the recipe for success is.”

So if it’s not providing your workforce with free meals or innovative workspaces, what is the ‘magic dust’ that makes Silicon Valley so successful?

Mitchell explains: “I wouldn’t say it’s magic dust. The one bit that is most different is valuations between the US and Europe.

“Typically a Valley business will raise twice as much money, twice as fast, at twice as high valuation than the equivalent non Valley business in the same sector.

“What that means is that you get eight times the difference within a few years, a huge difference, so that is a bit of magic dust.”

So a Silicon Valley business will increase much faster than it’s opponents, but more than that, Mitchell tells us: “The rest of it is sheer volume.”

“What it really does do is force you to up your game massively because you see what’s possible, and you realize that if you’re going to make it you have to execute incredibly well.

“Everyone drives each other on and the competition is intense, and that’s good right? You can’t be sitting in a bubble in Europe thinking ‘We’re doing pretty well, we’re doing pretty well in London’ it matters nothing, it really forces you to up your game and that’s a good thing.”

Huddle has grown into a market leader in online content-sharing in the US and in Europe. To learn more about the way Silicon Valley operates, watch the video above.