The Bay Area Innovation System


The Bay Area has been the world’s leading innovation center for the past 60 years. Its impact on the economy and how it operates, from enterprise productivity to health and communications, has been immense. The region’s ability to play a role in the creation of entirely new business paradigms and spaces of social activity—including personal computers and smart phones, semiconductors, cleantech, biotechnology and personalized medicine, rela- tional databases, magnetic storage and most recently cloud computing—is unrivaled, producing world-leading companies and jobs in the Bay Area, nationally and around the world on a large scale. It has also impacted the lives of hundreds of millions of people who use and benefit from the technology and services it generates.

The region’s ability to conceive, research, develop and commercialize new technologies and business models is based on an interconnected innovation system composed of a diverse set of institutions and actors that are linked by networks and share distinct cultural perspectives on how value is created. Together, these components and processes constitute an innovation value chain that—because innovation is dynamic and often non-linear—can also be described as an innovation cloud. This system has proven resilient, rein- venting and repurposing itself through multiple crises and economic cycles.

The Bay Area innovation system is built on a core of key institutions. The most critical are associated with higher education: leading research universities—the four regional campuses of the University of California and Stanford and supporting institutions—as well as the region’s five California State University campuses and its 26 California Community Colleges.

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Principal Author

Sean Randolph
President & CEO
Bay Area Council Economic Institute

Contributing Author

Olaf Groth
Emergent Frontiers Group LLC