How Ecosystems Evolve

There’s something I’ve been noticing about how the most innovative places in the world actually develop. It’s not what you’d expect.

Most people think ecosystems explode overnight or that you can just throw money and talent at a problem and create the next Silicon Valley. But that’s not how it works. The places that truly transform how we think and build don’t emerge randomly. They follow a pattern.

And once you see this pattern, it explains everything. Why Dubai, despite unlimited capital and global ambition, struggles to generate breakthrough innovation. Why parts of Southeast Asia are suddenly producing world-class companies seemingly out of nowhere. Why some cities with every advantage somehow stay stuck while others with less obvious resources become magnets for the most interesting work being done.

The sequence looks like this:

Craft → Capital → Culture → Cognition

This isn’t just about startups or tech. It’s the same pattern whether you’re looking at Renaissance workshops, research labs, or music scenes. And here’s the crucial part: you can’t skip layers. Try to jump ahead and the whole system stalls.

It starts with craft

Every ecosystem that matters begins with people who are already excellent at what they do. Not people who want to be excellent or who are working toward it, but people who have already developed real skill through years of practice.

This shows up in small details that are easy to miss. How someone approaches a problem when no one is watching. The care that goes into work that might never be seen. The kind of judgment that only emerges from building things, seeing them fail, and building again with that knowledge.

In the early stages, these skilled people usually exist in isolation. They’re working on fascinating problems, pushing boundaries, creating remarkable things, but they don’t know about each other yet. Visit any developing ecosystem and you’ll find this: incredible work happening in parallel, with no connection between the people doing it.

This isolation might actually be necessary. People need space to develop their own approach before they’re ready to engage with others. But eventually, that fragmentation becomes the ceiling. Without connection, individual excellence stays individual.

Craft creates the foundation everything else builds on. Without people doing work that’s genuinely worth attention, there’s nothing for capital to amplify or culture to spread.

Then capital creates space

Once there’s visible quality, investors and funders start approaching things differently. The most productive use of capital isn’t to fund predetermined outcomes. It’s to give skilled people permission to explore ideas they can’t fully justify in advance.

This creates something precious: margin. Time to think instead of just execute. Space to go deeper into problems rather than rush toward solutions. Room to try approaches that might not work but could lead somewhere unexpected.

When capital arrives before there’s enough skill to direct it, it rewards activity over insight. People start optimizing for funding rather than learning. The ecosystem gets loud and busy but doesn’t necessarily get better. You see lots of motion but little genuine progress.

But when capital follows craft, it becomes fuel for discovery. Those experiments it funds generate insights that become the raw material for what comes next. Capital creates the breathing room where real learning happens.

Culture emerges from sharing

Something remarkable happens once people have done meaningful work and had space to reflect on it. They start wanting to share what they’ve learned. Not because someone tells them to, but because they’ve figured out something that could help others avoid the same struggles.

Once you’ve wrestled with a hard problem and found your way through, you naturally want to save others from that same pain.

Culture grows organically. Through conversations over coffee where someone explains how they really solved that difficult challenge. Through blog posts about what actually worked and what didn’t. Through informal mentoring that just starts happening when experienced people encounter others facing similar problems.

Gradually, people begin naming patterns in their work. Vocabulary emerges. Knowledge transforms from something you protect to something that improves when shared.

But there’s a deeper psychological shift happening. People develop intellectual security. They stop worrying about looking smart and start sharing openly. The zero sum mentality fades, replaced by understanding that growing the pie benefits everyone. Through the right conversations, people open up. There’s osmosis happening.

Failures stop being hidden and become shared learnings that encourage others to attempt harder things. This creates a thriving culture where you can admit what you don’t know, share what didn’t work, and collectively figure out what might work next.

Culture creates the shared vocabulary that makes collective reasoning possible.

Cognition unlocks innovation

When knowledge flows freely and shared language matures, something extraordinary happens. The ecosystem develops what I think of as Standard of Thinking.

Just like Standard of Living describes the material conditions people expect in developed societies, Standard of Thinking describes how people engage with ideas in mature ecosystems. In environments where this standard is high, it pushes your own thinking up. You start operating at layers of abstraction that weren’t accessible before.

Watch how elite designers explain interface innovations through metaphors of physics, never mentioning screens or buttons. Listen to product discussions that sound like psychology seminars. Observe engineering debates that feel philosophical. This elevated discourse isn’t performance. It’s how ecosystems rewire themselves to see possibilities that didn’t exist before.

When you’re surrounded by people thinking at this level, you start observing systems and structures differently. You discover opportunities that haven’t been explored. Problems become entry points to reimagine entire categories of human experience.

This is how ecosystems learn to invent rather than just iterate. They develop the cognitive environment where new patterns emerge from basic ingredients. People don’t just solve existing problems. They start seeing possibilities that literally didn’t exist before anyone thought of them.

Cognition transforms ecosystems from productive to generative. It’s the ingredient that enables true innovation.

How this plays out globally

Seeing this framework in action around the world is fascinating.

Silicon Valley is the outlier. It’s the only place where all four layers work together seamlessly. Walk into any coffee shop in Palo Alto and you’ll overhear conversations happening at levels of abstraction that would sound strange anywhere else. That cognitive sophistication isn’t accidental. It’s built on decades of craft development, thoughtful capital deployment, and a culture that treats open knowledge sharing as the default behavior.

Dubai represents the classic capital first approach. Unlimited ambition and investment, but the foundational craft layer is still developing. You see impressive infrastructure and lots of activity, but not quite the depth of skill needed to direct all that capital toward breakthrough innovation.

Europe has undeniably strong craft and abundant capital, but something about the culture makes knowledge sharing happen more slowly. Maybe it’s institutional, maybe cultural, but the transition from protecting insights to freely sharing them takes longer there.

India demonstrates what exceptional execution capability looks like when it meets available capital. The technical craft is remarkable, but the mentorship culture is still forming. You can see it emerging, especially in Bangalore, but it’s not yet the default way people operate.

Southeast Asia has this sense of building momentum. Craft is emerging, particularly in fintech and gaming, and capital is flowing in. But those deeper conversations that transform individual successes into collective learning are just beginning.

South America has real pockets of talent, but capital constraints create a different dynamic. Without enough margin for exploration, it’s harder for that sharing culture to develop naturally.

Each region is working through these layers at its own pace, in its own way.

The insight isn’t about speed. What matters is whether each layer develops enough integrity to support what comes next. The ecosystems that grow carefully often create the most lasting impact.

Maybe what we’re really talking about is patience. Building each layer well enough that it can hold the weight of what follows. Recognizing that sustainable capability takes time to develop, but creates compounding returns when it does.

This framework helps explain what makes some ecosystems break through while others plateau. More importantly, it gives us somewhere to look when we’re trying to understand what comes next.

The places that will matter most in the coming decades won’t necessarily be the ones with the most obvious advantages today. They’ll be the ones building these layers thoughtfully, in sequence, with enough patience to let each one mature before rushing to the next.