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Silicon Valley Definition

What Is Silicon Valley?

The time period Silicon Valley refers to a area within the south San Francisco Bay Space. The title was first adopted within the early Nineteen Seventies due to the area’s affiliation with the silicon transistor, which is utilized in all fashionable microprocessors. The world is notable for the huge variety of technology companies which can be headquartered there. As such, it’s a international hub for technological innovation, the place a whole lot of corporations name it dwelling. It’s also identified for being a middle for innovation, entrepreneurial spirit, and a way of life based on technologically primarily based wealth.

Key Takeaways

  • Silicon Valley is a worldwide middle of technological innovation positioned within the South San Francisco Bay Space of California.
  • The world was named after the principle materials present in laptop microprocessors
  • Silicon Valley is dwelling to dozens of main know-how, software program, and web corporations.
  • A number of the main corporations within the area embrace Apple, Alphabet’s Google, Chevon, Fb, and Visa.
  • It is without doubt one of the wealthiest areas on the earth and one of many hottest actual property markets.

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Understanding Silicon Valley

The time period Silicon Valley was first utilized by Digital Information on its Jan. 11, 1971, cowl. It was a part of a three-part sequence written by journalist Don Hoefler, who was protecting the historical past of the semiconductor. The time period slowly expanded to incorporate and be related to know-how, particularly large tech.

Silicon Valley covers an space of 1,854 sq. miles and is dwelling to greater than three million individuals. It’s positioned within the Bay area of California. Though its boundaries are considerably nebulous, they typically embrace:

  • all of Santa Clara and San Mateo counties
  • the western fringe of Alameda County
  • Scotts Valley in Santa Cruz County

The area’s largest metropolis is San Jose. It is also dwelling to Stanford College and a number of other state college campuses. This educational presence has helped gasoline a wealthy research and development (R&D) synergy all through the Valley.

The variety of high-profile ventures born in Silicon Valley has made the area a beautiful goal for venture capital companies and buyers. There have been as many as 117 enterprise capital-backed initial public offerings (IPOs) within the area valued at about $253 billion as of the start of December 2020. A complete of 38 Fortune 500 corporations positioned in Silicon Valley as of 2020, together with:

  • a number of the most distinguished tech corporations, similar to Apple, Alphabet’s Google, Fb, and Netflix.
  • {hardware} and software program corporations like Cisco Programs, Intel, Oracle, and Nvidia
  • giants in different fields, together with Visa and Chevron

Particular Concerns

The median household income in Silicon Valley surpassed these reported in San Francisco, California, and the USA. As of 2019, Silicon Valley households earned a mean of $134,615 per 12 months, whereas these in San Francisco and California earned $123,859 and $80,440. The nationwide common totaled $65,712.

Silicon Valley is without doubt one of the wealthiest areas on the earth. Forbes reported there have been 365 tech billionaires throughout the globe with a mixed net worth of $2.5 trillion. The 20 richest on this sector have been price $1.2 trillion mixed. In 2018, 143 tech billionaires have been reportedly residing in Silicon Valley.

Quite a few enterprise leaders determined to depart the area, taking their companies to different components of the USA. As an example, Tesla (TSLA) chief executive officer (CEO) Elon Musk introduced he was transferring to Texas in December 2020. His announcement adopted different main corporations, similar to Hewlett Packard (HPE) and Oracle (ORCL).

Enterprise leaders main the transfer out of Silicon Valley cited causes like general political local weather within the area in addition to looser COVID-19 restrictions in different components of the nation (in comparison with California).

A Transient Timeline of Key Silicon Valley Developments

  • 1939: William Hewlett and David Packard patent an audio oscillator, forming the inspiration for the Hewlett-Packard firm.
  • Forties: William Shockley invents a silicon transistor at Bell Labs.
  • 1951: Fred Terman establishes Stanford Analysis Park as a partnership between Stanford College and the Metropolis of Palo Alto, offering a base of operations for each navy and business technological improvements for corporations similar to Fairchild, Lockheed, and Xerox.
  • 1956: William Shockley opens his personal agency, Shockley Semiconductor Labs, in Mountain View.
  • 1957: A number of Shockley staff resign and begin a competing agency, Fairchild Semiconductor. These males will later go on to begin many different corporations, together with Intel and Nvidia.
  • 1958 to 1960: Robert Noyce and Jack Kilby independently uncover that every one components of a circuit together with the transistor may be created utilizing silicon. Their discoveries led to the built-in circuit, created from silicon, which is utilized in all microprocessors at the moment.
  • 1961: Former Fairchild backer Arthur Rock establishes Davis & Rock, which is taken into account the nation’s first enterprise capital agency, giving rise to a brand new sort of funding trade.
  • 1969: The Arpanet laptop community is established with 4 nodes, together with one at Stanford College. Arpanet is the inspiration for the web.
  • 1971 to 1972: Journalist Don Hoefler publishes a three-part report on the rise of technological growth within the area in Digital Information, titled “Silicon Valley, U.S.A.” He is credited with creating the area’s title.
  • Nineteen Seventies: Atari, Apple, Microsoft, and Oracle are based.
  • Nineteen Eighties: Cisco, Solar Microsystems, and Adobe are based.
  • Nineteen Nineties: Netscape, Google, Yahoo, Amazon, and PayPal are based.
  • 2000 to 2010s: Fb, Twitter, Netflix, and Uber are based.

Main Corporations in Silicon Valley

A number of the main corporations that decision Silicon Valley dwelling. A few of them embrace:

  • Apple (AAPL): Based in 1976 by Steve Jobs, the corporate relies in Cupertino, Santa Clara County. The corporate’s market capitalization is $2.41 trillion, It reported income of $274.15 billion in 2020. Apple’s price-to-earnings ratio (P/E) was 29.14.
  • Alphabet (GOOG): The corporate’s headquarters, which is commonly referred to as The Googleplex, is positioned in Mountain View in Santa Clara County. It boasts a market cap of $1.88 trillion and a P/E ratio of 31.30. Alphabet reported full-year income of $182.35 billion in 2020.
  • Chevron (CVX): This multinational power company calls San Ramon, Contra Costa County dwelling. Chevron reported $94.40 billion in revenue in 2020 and has a market cap of $187.12 billion. Its P/E ratio is 52.25.
  • Fb (FB): One of many largest social media networks on the earth, Fb is headquartered in Menlo Park in San Mateo County. The corporate has a market cap of $1.03 trillion and a P/E ratio of 27.62. Fb earned $85.96 billion in income in 2020.
  • Visa (V): Visa offers cost providers and is headquartered in San Francisco. The corporate earned $21.85 billion in income in 2020. Its market cap is $471.62 billion and it has a P/E ratio of 46.63.
  • Wells Fargo (WFC): This monetary providers firm was based in 1852 and relies in San Francisco. The corporate earned $82.13 billion in income in 2020. It has a market cap of $190.82 billion and a P/E ratio of 13.30.

The place Is Silicon Valley in California?

Silicon Valley is positioned within the southern a part of the San Francisco Bay Space of California. It encompasses greater than 1,850 sq. miles in space.

What Is Silicon Valley Well-known For?

Silicon Valley is called a hub for know-how corporations, together with Apple, Fb, Cisco, and different main corporations like Visa and Chevron. The area attracts quite a lot of enterprise capital and is dwelling to a number of the world’s richest individuals.

Which Cities Are A part of Silicon Valley?

San Jose is the most important metropolis in Silicon Valley. The area additionally contains Santa Clara, Redwood Metropolis, Mountain View, Palo Alto, Menlo Park, Cupertino, and Sunnyvale.

What Does Silicon Valley Unicorn Imply?

A Silicon Valley unicorn is the time period given to a non-public startup within the area that’s valued at over $1 billion. The time period unicorn is often used within the enterprise capital trade. As an example, San Jose-based Zoom Video Communications (ZM) was valued at $1 billion in 2017. Based in 2011, the corporate went public in 2019.

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