Beyond Silicon Valley

For more than a decade, Silicon Valley has been considered the epicenter of technological innovation. Indeed, all the key elements of a technological revolution are located within a few kilometers of Interstate 280: a top education and research institution at Stanford; a consumer audience primed to try and adopt the next new innovation; established companies with a history of technological innovation, and, of course, an engaged, active venture-capitalist community on Sand Hill Road.

While there's no denying the role that Sand Hill Road, Silicon Valley and the United States have played in the development of the technology industry to date, the insularity of this community may prevent investors from finding the next hot start-up. Their investment focus on this fertile area is understandable, and a safe bet—if it isn't broken, why fix it? But right now, from Stockholm to Shanghai, new hubs of development are flourishing as a result of ambitious entrepreneurs who are cultivating ideas targeted toward the global consumer audience.

Having a global perspective played a critical role in my development as an entrepreneur. The same basic concept inspired Kazaa, Skype and Joost—a drive to democratize the Web and bring new technologies and media to the global population. It's no accident that Skype emerged outside the United States. While many American companies worked on voice-over-Internet technologies, the existing telephony infrastructure in the United States hindered the development of a consumer-focused Internet telephony service. In the United States, telephone calls were considerably less expensive than elsewhere in the world, and basic telephone service was widely accessible. In many other countries, however, phone service was neither widely available nor affordable. Janus Friis and I identified that problem and created Skype to answer it.

Entrepreneurs with a global view will increasingly be those who succeed. Although the United States is still the world's largest consumer market, the innovations developed there don't always translate to the global audience.

Many emerging markets, like Brazil and South Korea, have high rates of broadband penetration but less robust traditional infrastructure—from "luxuries" like telecommunications, television and radio to "basics" like payment systems, energy and electricity. Entrepreneurs in emerging markets are marrying these two elements—developing technologies that deliver these services over the Internet. Often these innovations provide better access to services than the more traditional methods of delivery. For example, it's possible that we could see technologies that optimize a consumer's or business's energy consumption on a minute-by-minute basis.

At the same time, these markets are flush with human capital—ambitious, intelligent individuals who have more appetite for the hard work and dedication needed to make a start-up succeed than some of their U.S. counterparts. From Eastern Europe to South America and Asia, varying degrees of economic, political or cultural repression have given way to more-market-friendly systems and a new generation determined to challenge the status quo and improve their own and their families' lives. National pride is a great motivator.

That's one of the reasons Janus and I have looked beyond Silicon Valley when it comes to building and staffing our businesses, and why we continue to do so now as investors through our venture firm Atomico, which has already made a number of investments in companies based in Europe and South America.

We aren't alone. There is a growing pool of early-stage investors based outside Silicon Valley who are looking way beyond the area for the next big ideas. Their presence is a boon to entrepreneurs who previously had to pitch ideas over long distances and in foreign languages. Not only do they share a language and a culture, but local entrepreneurs and VCs share a desire to improve the standing of their countries and want their countrymen to succeed. As the new crop of global tech hubs grows, many more entrepreneurs will succeed, regardless of whether they receive a blessing from Sand Hill Road.

Zennström is the cofounder of Kazaa, Skype and Joost, and a cofounder and partner of Atomico, a risk-capital firm.