It is quite a quagmire so to speak for Silicon Valley. For SA they have adopted policies that are basically designed to diversify the country away from oil so they are more willing than other countries to invest in very innovative "pie in the sky" type ideas. SA's population doesn't have the innovation skill that other countries have so SA just invests in the foreign talent. The new ideas are often developed in the Silicon Valley area. For SA, they are willing to invest in these wild ideas because for them...the money effectively just gushed out of the ground. That's why SA is often a big investor in very cutting-edge, high-risk investment funds like softbank's vision fund.

For Silicon Valley, this is quite a major situation because entrepreneurs here effectively live or die based on if they can get funding. Even if the idea is amazing and has potential, the founder will just abandon the idea if investment doesn't materialize. SA is a godsend to any entrepreneur who has an idea that is viewed as high risk based on traditional VC investors. If SA pulls out of being so proactive with their investments then it will be a huge wake up call to many early stage startups for sure.