Why Silicon Valley Rose and Why New Mexico Stalled
New Mexico once had an environment where ideas could flourish
From Silicon Valley to Albuquerque
Marion and I recently flew from Dallas to Paris to visit our daughter's family and meet our newest grandson. It was my first overseas flight and the first time in years I hadn't flown economy. I didn't know how the seat worked or how to navigate the technology. I could have pretended to know — and been miserable. Instead, I asked the gentleman next to me (William, not his real name) for help.
William not only showed me how everything worked, but he also opened the impossibly small bottle of salad dressing. Over the next few minutes, I discovered that he was a graduate electrical engineer from Texas A&M, a leader in the semiconductor industry, and that he was on a monthly trip to Europe. I settled in, looking forward to a good conversation before the cabin lights dimmed.
I asked him a question that had long intrigued me:
Why did the semiconductor industry spring from the San Francisco Peninsula?
The answer was not simple — but it was clear.
The San Francisco Bay Area was a center of scientific, mathematical, and artistic ferment that spilled into every corner of the community. The 1960's music scene gathered in San Francisco before going national (I attended a Grateful Dead and Santana concert at my high school). Robert Oppenheimer and Ernest O. Lawrence taught and conducted research at U.C. Berkeley (my mother crossed paths with both at the Radiation Laboratory before heading to Oak Ridge for the Manhattan Project). The Free Speech Movement gathered at UC Berkeley's Sather Gate, blocks from my father's place of business. Wells Fargo and Bank of America helped anchor West Coast banking (both provided loans for Berkeley Motors and Stanford Lincoln Mercury to sell cars, BeSt Leasing, my father's.)
It was normal in the Bay Area to question conventional wisdom. It was acceptable to imagine that anything was possible.
While Kodak made incremental improvements to film and processing, visionaries in California flipped the paradigm. They reversed the logic of lenses — making images smaller, not larger — "burned" patterns onto materials, added chemical washes, and created what became circuit boards.
But William added a variable I had never previously considered: capital.
The San Francisco banks funded the startups.
Not recklessly. Not blindly. But within a culture that evaluated risk differently. They were not New York banks, polished and powerful. Wells Fargo's roots stretched back to the Gold Rush. Bank of America began between two barrels and a plank after the Great San Francisco Earthquake and Fire. They were scrappy. They remembered that fortunes were built in rubble by people willing to try.
Those banks provided the capital that allowed California to become an economic and agricultural powerhouse.
But capital alone was not the answer.
California had built one of the strongest educational systems in the nation, from K–12 to community colleges to state universities. Stanford, UC Berkeley, and Caltech were globally respected institutions. Long before Sandia, Los Alamos, Hanford, or Oak Ridge rose to prominence, UC Berkeley's Radiation Laboratory was pushing the boundaries of nuclear science.
My mother told a story from her time as a young secretary at the cyclotron building. She was walking through the hall, turned a corner, and stumbled into a circle of physicists sitting cross-legged on the floor in deep discussion — landing in the lap of Oppenheimer himself. That is what an environment of open ideas looks like. Minds engaged. Hierarchies are secondary to discovery.
That same spirit once existed in New Mexico. When I relocated to Albuquerque from Portland, Oregon, in 1980, New Mexico was firing on all cylinders, while Portland was circling the drain.
Culture matters.
William made a simple but powerful observation: the semiconductor process might have remained just an idea if the banks had not funded it.
Contrast that with Albuquerque in the 1970s. When Bill Gates sought a small business loan for Microsoft, local banks reportedly declined. Microsoft moved to Washington.
When I started Britton & Rich Contractors 42 years ago, I presented a pro forma to a banker after multiple meetings. He looked at it, tossed it back across the desk, and said, "New businesses are risky businesses. Contractors are risky businesses. We don't take risks."
There is no silver bullet that will miraculously turn New Mexico around — despite what politicians in Santa Fe promise. Healthcare expansion, malpractice reform, and more doctors are symptoms of something deeper.
The real question is this: Have we built an environment where ideas can flourish?
An environment where:
• Education is excellent at every level
• Capital is available to disciplined risk-takers
• Failure is analyzed, not punished
• Institutions prize outcomes over bureaucracy
• Families feel safe enough to let their children dream
• Industries do not emerge by proclamation. They emerge from ecosystems.
• California and the San Francisco Peninsula provided a vessel for great minds, bold capital, and cultural permission to converge.
What vessel is New Mexico building?
Until we answer that question honestly, we will continue debating symptoms rather than laying foundations.
