Fail More. Experiment More. Plan Less.

Jawed Karim, an alumnus of St. Paul Central High School, was part of the early development team at PayPal, on hand to see it scale up and be purchased by eBay in 2002 for $1.5 billion. Then he and friends developed YouTube and sold it to Google two years ago for $1.65 billion. Now Karim, a PhD student at Stanford, is a cofounder of Youniversity Ventures, a venture capital firm focused on seed-stage investments in the consumer Internet space.

In October, Karim was a panelist at the 22nd annual Minnesota Venture and Finance Conference, hosted by the entrepreneurial networking group The Collaborative and by the Minnesota Venture Capital Association. Asked by facilitator Michael Gorman of local VC firm Split Rock Partners how Minnesota Internet start-ups can stay competitive with Silicon Valley, Karim gave an answer worth considering for any start-up.

Gorman: What advice would you offer folks who are based here on building a leading consumer Internet company, given the nexus of a lot of that activity in Silicon Valley? What should a Minnesota company do to make sure that they’re staying current and competitive with what’s taking place in the valley?

Karim: Based on my interaction with both Minnesota and Silicon Valley entrepreneurs over the last few years, you know, one big difference, obviously, between the two is that there’s much more activity in Silicon Valley. And with more activity, you also get more failures, you know, that’s just a fact of life. It’s kind of like the stock market, actually: In order to get higher returns, you have to accept higher risk and volatility.

So what you’ll see in Silicon Valley is that a lot of the very successful entrepreneurs, they actually have a sometimes long list of failures behind them, but that’s okay. And what I’ve noticed is that the attitude toward failure in Silicon Valley is very interesting. It’s not something to be ashamed of, or it doesn’t look bad on your record.

In fact, in a lot of cases, I think failure in Silicon Valley can be perceived positively because it can be experience. So, you try a lot of different things, some things may not work out, sometimes because of things you did wrong, sometimes it’s due to factors beyond your control, but in either case you take that as a lesson and apply that to your next venture.

And so I found that very interesting, that if entrepreneurs in Silicon Valley talk about their record, they talk openly about their experience and the lessons they’ve learned. Whereas here, I sometimes feel like the appetite for risk is lower, so I guess you could say that people are more afraid of failure. And that leads to people being more cautious, which, at the end of the day means that you will have less volatility, but overall also much less activity.