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Every so often we hear about another new technology hub; currently, Shanghai, Buenos Aires, Tallinn and Bangalore are among the places vying to be the next Silicon Valley. Add to that list Switzerland — in particular, Zurich. Earlier this week I ran into Michael Naef, founder […]

michaelnaf

Michael Naef, CEO of Doodle

Every so often we hear about another new technology hub; currently, Shanghai, Buenos Aires, Tallinn and Bangalore are among the places vying to be the next Silicon Valley. Add to that list Switzerland — in particular, Zurich.

Earlier this week I ran into Michael Naef, founder of Zurich-based Doodle, which can be loosely described as a smarter, simpler version of Evite that works with your existing calendaring systems.

Doodle, which claims some 3 million users — 800,000 from its native Switzerland — is one of the dozens of technology startups that have sprouted up around the country. According to some estimates, there are between 50 and 100 technology startups in Switzerland –- a pittance when compared with the San Francisco Bay Area, where the buildings surrounding South Park alone could house that many companies –- but impressive nonetheless.

And Naef said that number is on the rise, especially around Zurich. What’s behind the growth? The emergence of a healthy technology ecosystem: There are half a dozen venture funds in Switzerland; the government helps technology startups through various programs; and Switzerland has broadband aplenty –- it ranks fourth among OECD countries. As of June 2008, nearly 33 of its every 100 inhabitants had a broadband connection.

Even more important is the fact that a lot of big technology companies have set up shop there. Google has set up its European engineering headquarters in Zurich, and Yahoo moved its European headquarters there from London last year. There is peripherals maker, Logitech, and even a few large, non-IT tech companies, like Tyco. They find there a plentiful supply of engineering minds, many of whom graduated from Switzerland’s equivalent of MIT, the ETH.

Many of those engineers, encouraged by the successful sale of local startup, Wuala, a P2P storage service, to French hard drive maker Lacie, are likely to try their hand at entrepreneurship. But when I asked Naef if he had missed out on any growth opportunities because he was based in Zurich and not in Silicon Valley, he said no.

“If it would have helped us grow faster if we were in Silicon Valley, I would have moved the company here,” he said. In fact, he thinks being in Switzerland has worked to Doodle’s advantage. Just like Israel’s limited local market forces companies there to think globally right from the get-go, so do Swiss-based firms.

In a post-broadband world, where geographic boundaries are blurred by the Internet, that is good vantage point to have. Doodle is now available in 30 languages and works across multiple time zones. “We have four official languages in Switzerland, and that alone is enough to get us to think globally,” Naef said. And global focus can bring a lot growth -– if not profits -– as demonstrated by Facebook.

If this furious pace of startup activity keeps up, I may just have to make a stop in Zurich during my next trip to Europe later this year.

  1. Does anybody have a good list of the tech startups in Zurich?

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    1. Birdyomnomnom Wednesday, May 6, 2009

      This is a good list, i know all of these startups and they represent the swiss ground for startups very well, since all of them stand for a good product.
      The Creative Commons Licence movement and generally Open Source get much support in Switzerland too.

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  2. We’re all happy to welcome you here in Zurich. Just send us a note!

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    1. he he, that puts your company on the list. thanks for the invite… I’m just curious.

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  3. Logically, as everything ‘big’ disaggregates, one could foresee silicon valley and its concentration of ‘big’ venture firms going the same way. Reality however often trumps logic.

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  4. eBay has recently moved to Zurich too.

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  5. Om, Zurich has turned into a gem…the large corporates discovered this first and keep locating or moving their EMEA HQs to Zurich and Geneva. A clear trend, and above you could also have added IBM, Cisco and 15-20 other companies who joined the party in the recent past.

    Having had one foot solidly in Silicon Valley and one in Zurich for the last 15 years, my companies have been based in Switzerland by design. No capital gains tax, pre-event tax rulings, low company- and even lower personal income taxes, mortgage rates below 2% ….and so on.

    Zurich is obviously not SV though. By far. Valuations are lower, the acceptance of ‘creative failure’ non-existent, and investors could learn from their colleagues in Palo Alto. Also, the time to exit can be significantly shorter in the Valley. You will therefore over here end up with a product usable in all corners of the world, which is the point you make above. There’s also plenty of talent, great universities, low cost of capital and an awesome quality of life here. Makes it easy to motivate key talent to come and work for you.

    Being in a position to take a peek behind the scenes I can also say that the start-up pipeline is high-quality and high-potential, also from a SV perspective. Very impressive on the Life Sciences side.

    Personally I chose to relocate to Zurich…may I suggest for good reasons ;-) Come and check out the place.

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  6. Om, you got the OECD star wrong. It is 33 connections per 100 inhabitants. The way you phrased it makes it sound like only 33% of the Swiss have broadband, when it’s nearly double that.

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  7. [...] Is switzerland the newest tech hub? Just read this: Is Switzerland the Newest Tech Hub?: [...]

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  8. LiberoVision are based in Zürich and seem to be going from strength to strength

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  9. Krishna Baidya Sunday, April 5, 2009

    Good points mentioned about the distributed “silicon valley”, OM.

    I was curious to know your thought about Israeal. Any thoughts?

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  10. Swiss is NOT a newest tech hub. It’s ALWAYS a tech hub. Did we forget where web born? -> CERN lab in Geneva.

    IBM has a research lab in Zurich and technopark in Zurich is an interesting place with lot’s of startups.

    I worked in India, Swiss(basel & zurich) and last 10 years here in silicon valley. IMO, Swiss is a great place to do basic/fundamental research. The eco system supports it. I always love to go back & work there…

    From commercial product development perspective, the problem is multi-language + limited set of technical resources.

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