The question is what city would be ideal to create Europe's Silicon Valley?
The premise is that people make Silicon Valley: investors and nerds. It also needs to be an attractive place to live with good weather or at least some cultural value (Boston as an example). Graham argues it also must have personality, something to attract the creative class and keep them there. Another requirement is a good university.
Taking into account these factors a few whole regions can be eliminated (sorry Scandinavia, the darkness is just too depressing for a lot of people). Now, assume you were tasked with choosing a location and given a few billion dollars to do it.
What you would need is a place rich people and nerds want to live. Some universities in the area would help (most probably some of this money would be spent improving them into top notch universities in technical fields). Also you can assume that the city/country would be slightly flexible on changing regulations/laws to accommodate a lot of startups. You can't choose Russia and say it would be easy, or say France and make employment very easy. Of course you could pick any of these locations, just have to make an argument why and explain how it could be overcome.
My personal pick, Prague. To start off it's a UNESCO heritage site, the whole city is an amazing place and one of Europe's biggest tourist destinations. WW2 did very little damage to the old city and it's a charming city you feel comfortable walking around and it's easy to get around on public transport. It's also in the EU which makes it convenient for most Europeans to live and work there and do business with other EU countries.
To see if doing business in Czech Republic makes sense I looked at Doing Business in Czech Republic.
Starting a Business looks okay compared to other OECD countries except it might cost more, however, if we are investing lots of money to get startups this isn't an issue. Also, Czech Republic has a lot lower costs of living compared to Western/Northern Europe. It's also fairly on par for hiring workers as well. The biggest concern with Prague would be investor protections. Czech Republic lags behind a lot of other countries in this area and would require some improvement to attract proper capital. The second biggest concern would be the difficulty of closing a business. If there are a lot of startups, presumably a lot of failures as well.
It has some universities as well, none are top rated, but I think it certainly could attract and keep a lot of talent. Another problem might be language, English has become the language of computing and is the most well spoken language in the EU (51%). However, only about a quarter of Czech Republic speaks English. I would guess that this would number would rise significantly if broken down into Prague and younger people though, so it may not be that big a problem.
So that's my pick, Prague, what would you choose and why?
Photo credit: jackfre2 on flickr