Governments don't possess seeds to grow own Silicon Valleys

To forestall all those questions, or perhaps provoke more of them, here's my advice. First of all, you may not be able to build a garden, but you can build structures around it and within it to help it grow. Those include tax policies that favor investment, labor regulations that favor mobility (easy to hire and to fire people), and a generally favorable business climate - clear laws, honest courts, sensible banking regulations and financial disclosure requirements.
You can also feed the garden, with a ready supply of capital and well-trained people (a nearby university, perhaps). But capital is more than just money coming in; it's also an environment that encourages businesses to grow by providing places for them to grow into - whether it's a public stock market or the possibility of being acquired by a complementary company. You need seeds, or ideas. That's pretty easy; people have ideas all over the world. But they also need fertile ground; that's tougher. Call that a ready market, open to new ideas, and with the money to pay for them. All these things Silicon Valley has in abundance. The most important thing it has, however, is something generally not found in gardens, or in most places outside Silicon Valley, and that's an entrepreneurial culture.
In short form, an entrepreneurial culture is role models, examples and, of course, the day-to-day experience people get from working in other companies, especially start-ups. So in some sense, it may be more important to have Hewlett-Packard or Apple or NetWidgets nearby than Stanford University. In the bigger companies, people learn to manage. In smaller ones, such as the hot start-up of the month, they also learn to dream and take risks. An entrepreneurial culture permits rapid evolution, not just growth. It fosters trial and error, visibly, so that companies can learn from others' mistakes, not just from their own.
And how can you get such a culture, if you're a well-meaning government? Again, it's not something you can build, but there are two specific things to encourage: lively, truthful media that covers both failures and successes, and institutions that foster interaction among people. In Silicon Valley, the San Jose Mercury News, the hometown paper, has become the daily chronicle of high-tech. Each quarter, it publishes a detailed survey of venture capital placements: which company has raised how many millions of dollars from which venture capitalists. Each day, it reports on everything from who has joined a start-up as vice president of marketing, to new products from another start-up, to the cautionary tale of a company that grew too quickly but not well. To keep in touch, I subscribe to the Mercury from New York. It arrives a week late, but it's the details not the immediacy that matters. I can get the urgent news in the Wall Street Journal or online.
In this world of online, does the notion of local Silicon Gardens even make sense? To some extent, yes, but culture is local even though commerce is global. A lot of what makes Silicon Valley work is emotional. It just means more to see someone you know - someone local - succeed, than to see a distant figure. That's why the U.K. should have its own Nigel Gates, Russia its own Ivan Geits, Hungary its own Istvan Gates. Besides, the conditions Nigel, Ivan or Istvan must operate under, and the approaches he must take, are different from those that worked for Bill. You have to succeed locally before you can globally.
The second institution needed is those people mixers. Just last week I spoke (and listened) at a networking session in London called Digital People, co-organized by a for-profit (though not yet profit-making) online service called Fourleaf.com and Rupert Hart, who works with venture capitalist Hermann Hauser. Fourleaf.com aims to foster deal-making and lucrative contacts within the new-media sector. In Silicon Valley, there are some such organizations, but because the density is so thick, many of the same ends are achieved simply through informal meetings in the restaurants that cover the Valley. Every time I go to Il Fornaio (a great Italian restaurant, by the way, in which several venture capitalist friends of mine are investors), I'm guaranteed to run into a couple of people I know in the business, and they often introduce me to the others they are sitting with.
There are addresses in Silicon Valley that qualify as informal institutions - Sand Hill Road, for example, is home to some of the great names in venture capital including Kleiner Perkins, Trinity Ventures and Ziff Brothers Investments, along with some of the lawyers they use to structure deals and take companies public. Another office park, with slightly lower rents, is Landings Drive over near Sun Microsystems. I have been going there for more than 15 years, and while the companies change - from Software Publishing to Caligari and Onsale - the atmosphere does not. The newcomers learn from the old hands, as they stand outside smoking (now illegal indoors) or meet one another in the nearby restaurants. It's not only the programmers who are flourishing, but also the restaurateurs, the real-estate agents, the lawyers - and of course the San Jose Mercury News.
There's no magic to this, and it didn't come from some outside force. It is difficult to imitate precisely because it is decentralized - resulting from the interaction of a variety of factors. So my advice to those of you in government is: It is better to encourage private companies to invest in such a scheme than to do it yourselves. Governments can't afford failure the way private firms can. In fact, if you're an official with a yen to do good, perhaps the best thing you can do is resign and go into business for yourself.