The State of Silicon Valley | Russell Hancock

About Russell Hancock

Russell Hancock is President & CEO of Joint Venture Silicon Valley, a position he has held since 2003. In this role Dr. Hancock is best described variously: as a civic leader, community gatherer, institution builder, social entrepreneur, and outspoken advocate for regionalism. Since taking the helm of Joint Venture he has quadrupled the size of the organization; assembled a potent board filled with mayors, CEOs and university presidents; built strategic partnerships; recruited a highly talented staff; and launched initiatives that are delivering measurable results to the region.

Russell is also the founder of the annual State of the Valley conference, a “town hall” meeting attracting more than 1,500 leaders for a day spent in dialogue and discussion about the Valley’s challenges and opportunities. The conference features the release of Joint Venture’s Silicon Valley Index, a document now receiving national and international attention.

Dr. Hancock’s leadership in the Silicon Valley region builds on earlier work he led as Vice President of the Bay Area Council (1994-1999). There, he spearheaded the campaign extending BART to the San Francisco Airport. He also directed a broadly-based effort which ultimately created the Bay Area Water Transit Authority, charged with delivering a high-speed ferry system to the San Francisco Bay.

Educated at Harvard in the field of government, Russell received a Ph.D. in political science from Stanford University where he currently teaches in the Public Policy Program. Fluent in Japanese, Russell returned to Stanford in 2000 to become the inaugural director of the Shorenstein Forum for Asia-Pacific Studies, Stanford’s gathering place for ranking officials, senior executives, journalists, and scholars who shape outcomes in the Pacific Rim. In addition to the research output of the Forum, he built up corporate programs, established international fellowships, raised money, and generated public events featuring a stream of presidents and ministers.

Dr. Hancock was recruited away from Stanford to take the helm of Joint Venture at a time when the organization was in a period of transition and instability. He is credited with the growth and increasing influence of the organization, to the point where today Joint Venture is Silicon Valley’s recognized clearing house for regional analysis, and for collaborative approaches to solving the region’s problems. The Joint Venture model is now being replicated in various metropolitan regions throughout the United States, Europe and Asia, and Dr. Hancock has most recently provided advice to regional governments in Beijing, London, Madrid, the Netherlands, and Taipei. In 2011 the United States Government Accounting Office launched a national indicators project modeled on Joint Venture’s Index, with Russell providing high-level advice.

The Silicon Valley Business Journal perpetually names Russell to its annual list of Silicon Valley’s most influential “players.” Considered one of the Valley’s leading expositors, his interviews regularly appear in the New York Times, Wall Street Journal, Bloomberg Business Week, The Financial Times and Forbes. He is also a frequent guest on NBC Nightly News and is the host of “Inside Silicon Valley,” a weekly radio program heard on 1590 KLIV.

In private life Dr. Hancock lives in Palo Alto where he raises three children with his wife Marguerite. A devout Mormon, he serves in the stake presidency of the Menlo Park LDS Stake. He also leads a parallel life as a concert pianist, appearing with symphony orchestras across the nation. He is a founding member of The Saint Michael Trio, artists in residence at Montalvo Arts Center and Notre Dame de Namur University. Recent appearances include the Flint Center, Montalvo Arts Center, Le Petit Trianon, Ralston Mansion, Bismarck Belle Mehus Auditorium, Assembly Hall in Salt Lake City, and the Mostly Mozart Festival in Bartlesville, Oklahoma. He also enjoys promoting the Bay Area’s civic orchestras, and has appeared as soloist most recently with the Saratoga Symphony, the Ohlone Symphony, the Nova Vista Symphony, and the Redwood Symphony.

Episode Transcript of: The State of Silicon Valley | Russell Hancock

Alan
Welcome back and visiting here today with Russell Hancock and joint ventures Silicon Valley. Welcome to today’s show. Happy to be here. Thank you. So can you for the listeners, can you give your background how you how you landed in your position today maybe start up the your career history?

Russell
And sure, yeah, you know, I’m a guy that came here to go to Stanford. I did graduate school at Stanford in the political science department, I took a PhD there, I thought it was going to be somebody who would join a department and teach and do research, I thought I would be a pointy headed faculty kind of a guy. Instead, I decided that the real world was calling to me. And I didn’t want to just be theoretical, I wanted to be in an environment where I was actually working on policy problems and doing it with the real world actors and decision makers. So I joined the Bay Area Council, and I was the vice president working on a variety of issues, including transportation and housing and air quality. I actually went back to Stanford for a short time, I was the director of what’s called the Shorenstein Center at Stanford. And then I got recruited to take my current position, which is, as you mentioned, joint venture Silicon Valley, I’m the president and CEO. The organization brings together Silicon Valley’s leaders, public sector leaders, also private sector leaders, even University figures, like the presidents of the colleges and universities, and then the labor leader. So all the leaders of Silicon Valley come together in this framework that we call joint venture Silicon Valley, and I am their president.

Alan
So in in the organization, how often are you meeting with the different heads of the organization?

Russell
Well, in an ongoing way, I mean, we have committees working groups, task forces, and we also have a board of directors, the board meets on a quarterly basis. And the board really is this our goosed coming together of the region’s mayors, city managers, members of the state legislature, members of county boards, even members of Congress, so they sit on this board there alongside them are CEOs coming from the tech firms, major developers, other senior business leaders, also heads of labor organizations in college and university presidents all sitting at that table. And working across boundaries as true collaborators,

Alan
you know, you have a pretty good picture of what’s going on in the valley, can you give us an update,

Russell
I’m happy to do that. In fact, it’s part of our mission to thoroughly understand Silicon Valley, its trends, and its challenges. And then we actually document them. The organization houses a think tank is called the Silicon Valley Institute for regional studies. I’m also the president of the think tank, so I wear both of those hats. And I have to tell you, right now, we’re in an interesting period. It’s sort of hard to tell what’s going on we have a strong thriving economy, it’s generating jobs at record breaking paces, but over the past, I want to say 12 months, there’s been a there’s been a shift, there’s been a slowdown, it’s like we took the took our foot off the gas pedal, for for a lap. And now we’re pivoting into some other interesting areas.

Alan
What are the hot sectors right now?

Russell
Well, artificial intelligence, machine learning big data, for sure. The Internet of Things continues to be very important. security and encryption. Those are very big areas. But let’s not forget, electric vehicles, mobility challenges in the companies that are springing up around mobility, and that includes electric vehicles, electric vehicle infrastructure, but also alternatives like drones, and even crazy things like flying cars, which people are taking seriously in in Silicon Valley. Anyway, all of these represent New Directions for the economy. And it seems like we’re pivoting into those areas, the way we’ve done so many times over our 7580 year history.

Alan
One thing so Silicon Valley has a reputation for is that innovation. And still it remains about 50% of the venture capital in the world is running through this valley. That’s about right. If we, if we looked at what’s happening, though, the infrastructure here with the prices of real estate, you know, where do you see the forecast? Is everything going to continue to go to the sky in?

Russell
Yeah, it’s pretty crazy. We have the highest housing prices in the United States. There are a couple of little pockets a zip code here or there, and Connecticut, New York, some places like that, that might have a higher, higher median price. But for the most part, we should all understand that we’re living in the highest cost region in the United States. And it’s a really hard problem to fix. The reason is because we have a landscape that locks us in, we’re surrounded on three sides by water, and then we’re ringed by mountains, foothills, permanently protected open space, so we’re captive to this geography. And then within our footprint for development. We’re for the most part built out. I mean, there it’s not like like we have a lot of unused parcels out there. So it’s a supply problem. It’s a very simple supply problem, we can’t build enough housing. And yet this economy has exploded over the generations. And over the past six years, unbelievable growth and sustained growth. So we’ve added hundreds of 1000s of jobs, we’ve only added 10s of 1000s of housing, supply and demand, the prices are gonna go through the roof and they will continue to do

Alan
that. I visiting here today with Russell Hancock, he’s the CEO of joint venture Silicon Valley, I need to take a quick break, and we’ll be right back after these messages.

Alan
Since you can’t take your wealth with you spend time with your family

Alan
welcome back and visiting here, Dave Breslow, Hancock, joint ventures, Silicon Valley. And Russell. In the first segment, we talked about the overview of, you know, what joint ventures Silicon Valley does, I want to this segment, I want to delve more into the current trends. And as you’re, as you’re looking at bringing the local governments and the companies together, what are some of the issues that are being faced?

Russell
Well, the issue is growth, we have tremendous growth, it’s been sustained growth, sometimes it’s explosive growth. But the point is, it’s growth and we expect that this economy will continue to grow, we expect that people will continue to come to the area, because of the opportunities that are here. This is an innovative economy. It’s an entrepreneurial economy, that’s not going to change, we’re going to continue to attract the best and the brightest people from all around the world. So the question is, can we accommodate that kind of growth? Can we provide world class infrastructure to support the world class companies that are here? Can we address our livability issues, so that this continues to be a vibrant setting for the economy, but also a vibrant setting for people to raise families and grow their companies? So those are the questions, joint venture exists to tackle those. The interesting thing about a place like Silicon Valley is that it is after all, completely unorganized. Silicon Valley takes in about 45 different cities. It those cities spill over four different counties. There’s no overarching framework for those cities and counties to come together. In, in a in a process of decision making or planning. There’s nobody calling the shots. There’s nobody bringing together people so that they can come to a consensus about what the next steps should be. So we don’t really have a game plan. This is a problem. It’s especially a problem in a world class region that that needs to have a blueprint. So joint venture tries to provide that blueprint.

Alan
You know, when we move into transportation, we’re putting more and more cars on the road every day. So anyone that drives or freeways can see, the traffic patterns are changing substantially.

Russell
It’s horrendous. We have the worst traffic in the nation. There’s Washington DC there, Seattle, there’s Los Angeles, they rival us, but we are losing more time to daily delays than any other region.

Alan
So when we look at the south where we get Bart that’s currently stopping at the the Tesla plant Yeah, are in worse springs. But is that going to play a role in in helping expand down into Silicon Valley and bring more relief off that freeways are? How do you look at that from a logistical standpoint, that’s

Russell
the hope and Bart is extending Bart will be extending into downtown San Jose. That project is underway, it’s funded, it’s not fully funded. But we have confidence that that funding is is is going to fall into place. And meanwhile, the extensions are happening. But here’s the thing, it will just get into downtown San Jose, that’s as far as it’s going to go Bart is not going to ring the bay, it’s not even going to connect to Cal train. At some point, the hope is that it will connect up at Santa Clara outside of the San Jose airport, and that there will be a linkage to Cal train and then people can take rail all all the way around the bay. Will that help? It’s hard to tell? It’s not going to be enough. I can tell you that right now. In order to really make a dent in this problem, we should be making massive investments in infrastructure. And I’m talking about the scale that you see in places like Hong Kong, or Singapore, or so many parts of Europe, and we’re not anywhere close to doing that in the Bay Area.

Alan
How often do you get involved with the US And he’s out of the area and discussing the issues and the trends.

Russell
Well, we work very closely with cities, we work with our city managers, we also work with their elected officials, including the mayor’s. But here’s the funny thing about the cities in Silicon Valley. The elected officials are there for a four year period. They’re regular folks coming from all walks of life. The mayors usually serve for a one year period. They’re usually appointed by their colleagues on the on those councils, a lot of times they’re playing what we typically call figurehead roles, going to ribbon cuttings and so forth. When it comes to getting down to the nitty gritty issues of transportation, infrastructure, regional planning, housing and land use. The city’s actually aren’t the aren’t the best actors, mostly because they don’t have any jurisdiction beyond their city boundaries. And the problems we’re talking about are regional and they’re not local, they are regional and they require cities coming together in new constructs and a new framework. So this is the difficult.

Alan
I’m visiting here today with Russell Hancock, joint venture Silicon Valley need to take another break. We’ll be right back after these messages. I love fishing with my family. I think it’d be easier to use a net, it was so much fun. The times when we are together, it makes it all all the more worth it. Having dad teach them how to like cast a fly rod. And as long as we’re doing stuff together, we’re having fun. Some people see a father and his son fishing together, while others see a succession plan. Welcome back and visit me here today with Russell Hancock. And he says CEO of joint ventures Silicon Valley and and Russell. There has been significant growth within the last few years and in Silicon Valley, and it’s outpaced the infrastructure. Yes, I believe in the first segment, you mentioned that we’ve we’ve taken a little bit of a slowdown, but now it’s picking up again. I want to focus somewhat on the housing and the cost of living. Because this this seems to be an ongoing problem where a lot of cities are addressing it by putting denser housing covenants within the city infrastructure,

Russell
right? Yes. Okay. So we have a housing problem, the the median home price in Santa Clara County is now million dollars, that’s the median in San Mateo County is even higher than that 1.1 $1.2 million. Those are the home prices. Now this is housing that’s completely out of reach to the rank and file members of the workforce. That’s the kind of place that we live in. And then we’re not providing very much of housing, we’re not putting on the market in the first place, the inventory of housing is at historic lows. So the problem is the housing is getting bought up. In fact, it’s getting better in the sale prices are usually getting 1000s and 1000s of dollars beyond their asking price. So there’s people that can do this people that are buying the housing, but it’s crowding out the rest of the workforce. And so now we see people living farther and farther away, places where the housing becomes more affordable. We’re talking about the outer reaches of Concord, we’re talking about across the ultimate pass. We’re talking about South of Gilroy, this is contributing to our transportation problems, because now these people are flooding onto our freeways, we have an inadequate transit system to bring them in here. And so the problems just spiral,

Alan
you know, as you is, as we define Silicon Valley, there’s there’s pockets you get to San Jose. And that mount view in the Santa Clara is where would you consider a central hub of the valley?

Russell
Oh, you know, he debates rage about that nobody actually knows where Silicon Valley is they fight about it? Well, you know, if you were to draw it on a map, where what would be the contours? Nobody’s actually Sure. So we find it. First of all, we define it as a phenomenon and not just a place and that phenomenon is clearly spreading its footprint is all over the Bay Area. It goes all the way up the peninsula, it’s gone into San Francisco, it’s going into Oakland, Oakland has become a thriving Center for Technology and for startups. And so really, it just makes sense to talk about Silicon Valley as if we’re talking about the Bay Area.

Alan
Okay, and how does how does the Bay Area Council compared to what you’re doing with joint venture? Well, the berry

Russell
Council, despite its name, it sounds like a very official government body. It’s not it’s actually a business organization. They have 300 400 business members, and they represent those businesses on policy issues.

Alan
Because if someone wanted to get involved with joint venture Silicon Valley, how would they go about? Oh

Russell
my gosh, we welcome that. You go to a joint venture.org. And there on the website, it tells us very specifically how you can get involved. Companies join joint venture as members. They pay us annual membership dues. We also welcome senior executives to serve on our board of directors. Our board members also pay dues to the organization,

Alan
and you have a marquee event after the beginning of the year, every year, it’s called

Russell
the state of the valley. That’s where we release the Silicon Valley index happens every February, the index tracks over 70 different indicators. And then we spend the day talking about it. What are the indicators telling us? What direction are we going? What are our trends? What are our challenges? How do we mobilize to address them?

Alan
And and in person that, you know, there’s different committees that you have that are working in different pumps, can you go through some of those committees? Well, we

Russell
have groups that are working on infrastructure. And by that I mean, not only transportation, infrastructure, but also things like communications, infrastructure, and civic technology and making sure that we’re taking smart, sensible strategic approaches to the technology that we deploy in municipal settings. Across the region, we have a group that’s working on bicycle infrastructure, we’re hoping that the bike and the two wheel vehicles can be a compelling alternative to the automobile, and that that would put a dent in our traffic. We have groups that are working on old fashioned economic development, we have a group that’s working on El Camino rial, which is this 19 mile stretch of road that goes up and down the peninsula and connects Silicon Valley cities, and we’re trying to have that become a place for intensive housing, dense vertical housing, so that we can put a put a dent in our housing problems. So So those are some of the groups that we have active.

Alan
You know, Google has mentioned in a couple of press release, that they look at the self driving drones as a wave of the future. Yes, that’s your thoughts? Well,

Russell
we need to be working on every front, we need compelling alternatives to the automobile. And if that includes drones, so be it, the drone is very promising technology can be used to deliver not only people but goods, freight packages, and so that can take all of those delivery vehicles off the roads and, and it can get them off the roads at all hours of the day. And so that’s really hopeful. The sharing economy, the ride, the ride hailing services can also be an answer to this problem, because they represent the promise of carpooling. But they also represent the promise of goods delivery, and that can be happening during the off peak hours. So that that helps during those critical commute, commute periods.

Alan
You know, there’s been outlying communities that have begin to challenge the growth of the valley, for example, in Utah, they have a place for calling silicon slopes right now. Oh, yeah. In some of the Bay Area companies are they’re not relocating. They’re expanding operations. But how do you view that in overall, in terms of what you’re doing with joint ventures, Silicon Valley? Is it the CEA collaboration, and I’m

Russell
sure there are, there are regions around the country that are trying to apply this same formula. It’s a formula that promotes innovation, and entrepreneurship, and they’re trying to attract software technology, these leading edge companies, we think that’s terrific, we think that your best strategy for economic development is to have a pie that’s expanding. And so that everybody’s participating in that in that kind of growth. We don’t view it as competitive. Silicon Valley will always be a major node on a network of nodes. Now,

Alan
what would you say keeps Silicon Valley in place to be that major note?

Russell
Well, it’s not our housing, it’s not our transportation, I’ll give you that. But it is the culture of innovation that is here. It’s the world’s most highly educated workforce. That is here. It is Stanford University, and the other great universities that are located here. And then let’s not forget the venture capital. That is the secret sauce. And so here we have the epicenter of the venture capital, industry and industry that we invented, by the way, and that is the mother’s milk makes all of this happened. You go to these other places, and you just don’t have that kind of sophistication, that kind of infrastructure. You also don’t have the supporting infrastructure. And here we’re talking about the law firms, the the accountancy fees, executive search, all of this is firmly in place here, in addition to a wonderful quality of living, fabulous weather. And so that’s why these livability issues become so important for Silicon Valley.

Alan
So Russell once again could you give the listeners how to reach out to joint venture Silicon Valley contact you

Russell
and thank you for that opportunity. You simply visit our website, joint venture.org and there on the website it tells everybody how they can get involved. You can sign up for a mailing list if you are a company in the region. You should be a member of joint venture we welcome your membership by visiting

Alan
here Dave Breslow Hancock at joint venture Silicon Valley. We’ll be right back after these messages.

 

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This transcript was generated by software and may not accurately reflect exactly what was said.

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