Martin Vetterli, the president of the Swiss Federal Institute of Technology Lausanne (EPFL), which was founded 50 years ago, recently said in an interview that while you can learn a lot on a distance learning course, the atmosphere of a lively campus is irreplaceable. Do you share his opinion?
Absolutely. It’s no coincidence that there are clusters in the world. The “start-up valley” surrounding the EPFL in Lausanne or the wonderful success stories of the many start-ups from the Swiss Federal Institute of Technology Zurich (ETH) speak for themselves. If it hadn’t been for the ETH, Google would not have come to Zurich. As a hightech cluster, you cannot compete with Silicon Valley by opening a government-funded innovation center somewhere or other. It’s the clusters that never stop developing that prevail.
How important is physical proximity in this context?
It’s indispensable. You absolutely need young, hopefully slightly mad people who are fully dedicated to an idea to be physically present in the same place. You will never be able to replicate this campus spirit in the digital space. The physical proximity of like-minded people who view challenges from different perspectives and approach solutionfinding differently is irreplaceable. It’s one of the reasons why Switzerland is so innovative and competitive.
You mentioned successful start-ups. But when successful young entrepreneurs want to grow, they often find it difficult to obtain funds…
Yes, that’s true. The venture capital scene in the US is more mature, broader, and deeper than in Switzerland or generally in Europe. That’s a shame, because we have great human capital. People should be free to concentrate on their core business rather than having to spend so much time raising money. However, financing options are better now than they were five or ten years ago, and there is far more interest in venture capital in Switzerland.
To what do you attribute this increased interest?
The zero interest rate policy, the lack of alternatives, and the fact that many such investments are quite successful.
Mr. Varnholt, like most economists, you expect the zero or negative interest rate policy of the central banks to continue for a long time to come. What does this mean for investors?
Zero interest rates are favorable for investments. For calm, patient investors, the environment for equities in particular remains attractive. Across Europe, institutional and private investors’ equity holdings are still far too low. They will no doubt be increased in the next few years.