Behind Every Tech Billionaire Stands a Government Cheque

Get government out of innovation!" is something I hear all the time when working with founders and investors.

But, according to economist Mariana Mazzucato , governments are often the biggest risk-takers in tech innovation.

Her research shows that every major technology in your iPhone - from the touch screen to Siri - was created with government funding.

When Steve Jobs unveiled the iPhone in 2007, he wasn't just showing us a revolutionary product.

He was showing us how to turn government-funded research into something people love.

The touch screen? Created by government-funded researchers at Delaware University. GPS? A Department of Defense project. Even Siri started life as a DARPA project at Stanford.

This isn't taking away from Jobs's genius. He took these technologies and created something revolutionary.

But without decades of government investment - the kind of long-term, risky research that private companies rarely do - the iPhone wouldn't exist.?

Neither would the billions in venture capital profit that investing in Apple generated for its backers.

I'm seeing this government-led innovation firsthand in Bahrain, where I'm working with the country's Labour Fund Tamkeen ?on major education initiatives. They cover up to 70% of tech training costs and help companies transform their workforce for the Digital Age.

Some of these investments will pay off tomorrow, but many will take decades to really make a difference.

Singapore is a case in point: In the 1960s, while most governments focused on traditional industries, Singapore's Lee Kuan Yew made a big bet on tech education and innovation.

Today, Singapore hosts regional headquarters for most major tech companies and ranks as the world's most digitally competitive nation.

Governments are typically not good at picking winners, i.e. funding specific companies, but they are vital for long term ecosystem investments.

For founders and investors, this means three things:

1. Location matters more than you think. Don't just look at tax rates - look for ecosystems with strong government R&D support and forward-thinking regulators.
2. Think long-term. The best opportunities often emerge in places making decade-long investments in talent and infrastructure.
3. Do your ecosystem due diligence. Companies in well-supported environments have hidden advantages their competitors don't - from talent pipelines to regulatory support.

To understand this topic deeper, listen to this week's Tech for Non-Techies podcast episode: 232. Why Governments Are Tech's Most Powerful (and Overlooked) Innovators

Listen to this episode to?learn:

• Why every technology in your iPhone started with government funding
• What a "regulatory sandbox" is and why it matters for innovation
• Why the "lone genius founder" myth is?dangerous for?investors
• How to spot government support that could give your company an edge
• Case studies from Silicon Valley, Singapore and Bahrain

Listen on:

• Apple
• Spotify
• YouTube
• Amazon Podcasts
• Stitcher
• Pandora

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Speak soon,

Sophia Matveeva