The best minds of my generation are thinking about how to make people click ads. ~Jeff Hammerbacher on the current generation of start-ups
Lara Druyan stashed this in Silicon Valley!
Although there are clearly some great companies being built today, there are start-ups that seem to be built for a pump and dump. We all know who they are.... How do you think history will be written about this time in Silicon Valley?
*bump* I wanna hear people's responses to this one.
I think history will be kinder to this group than to the dot-com bubblers:
There was a point in the late ’90s where all the graduating M.B.A.’s wanted to start companies in Silicon Valley, and for the most part they were not actually qualified to do it. They brought the whole sideshow of the hype and parties and all that crap. M.B.A. graduating classes are actually a reliable contrary indicator: if they all want to go into investment banking, there’s going to be a financial crisis. If they want to go into tech, that means a bubble is forming.
This group wants to build great things. Even if we fail, at least we're makers.
I am not so sure. To me, it feels that many of the companies are being built with aluminum siding and tin roofs but claim that they are mansions.
I was still learning to ride a bike in the 90's.
Does anyone notice anything different about why people end up staying in the scene? I know the comment was more about why people enter the scene but I think the community often mirrors the people who have been in it for a while - so has the investor/serial-entrepreneur crowd changed?
I think it will be called the age of social, and most of the writers will focus on the larger start-ups. Other than Color, most of the smaller startups didn't do that much to attract a ton of attention from the press. One TechCrunch article isn't going to make your company!
Robert Scoble writes about this today too :)
Thank you for the great link, Ajay!
Frankly, Scoble is harshing my mellow:
If you're gonna pitch me something it better provide magic. Angels better sing when I open your app up. Otherwise, why should I use your app instead of Instagram, Foodspotting, Foursquare, Yelp, or my new ones, Batch, SocialCam, or Oink? If your design isn't better than Flipboard, or at least as neat looking as Oink, why are you even trying?
Magic in a product is a rare and wonderful thing. Is he saying if you don't currently have it, you shouldn't even try?
If so, I think he's wrong. I believe in iterating.
I was a very early user of YouTube, Twitter, LinkedIn, WordPress, Flickr, and Skype, among others. None of them were great at the beginning. They iterated and kept getting better.
Scoble's the industry cheerleader, but it sounds like today he's hanging out behind the bleachers smoking with the cynical kids. This kind of blanket statement always gets my hackles up, because he's talking shit, but some entrepreneurs will believe him, and then we (advisors) have to undo that broken mindset.
Yes, iterations! Yes, crappy first versions! Yes, ugly before pretty! Yes, follow your users! NO -- Do not adopt someone else's standard of excellence as the bar you should measure your product against! Flipboard's level of aesthetic design isn't necessary for most products. It would be wasteful to go there.
Most of the products that make culture evolve are unsexy—the vacuum cleaner, the washing machine, and the zipper had far more profound impact than flipboard (no offense intended to flipboard). I always want entrepreneurs to make meaning in a real person's real life. Square means that I can pay by credit card at the farmer's market. Healthy produce in the fridge=more home cooking for me. Skype means that the diaspora intern (who lives in Iowa), can sit Shiva with the rest of the team here in SF after Ilya's death (true story -- they have been keeping a skype connection open all day this week).
I'm all for creating magic, but I think Scoble's being snotty and vapid with this one.
I agree. I also think he's making a different point.
Like 1999, history will be written about the winners, with brief footnotes about the more spectacular losers. Winners who eventually die make history. Losers only make history if there is a sharp clear story about them. Pixelon http://en.wikipedia.org/wiki/Pixelon is a great dotcom story. So is Boo.com.
This era's history will be about the rise and eventual fall of Facebook but also the long, boring rise of LinkedIn. Most social networks have an inherent half life. The platforms don't want to offend people by cutting features so they build up clutter. People don't want to offend people by cutting friends, so they build up clutter. Eventually people move to new networks where their current social group is congregating. LinkedIn is an exception because your resume follows you for life anyway.
Single feature pump and dump companies that get acquired or fade away don't make history.
You make an interesting point about LinkedIn -- and the same could be said about PayPal. Slow and steady but ever-getting-bigger and benefitting from network effects.
The thing I learned from the dot-com bubble is that some companies die quickly (Excite, Lycos) while others take much longer to die (AOL, Yahoo).
And it's so hard to tell. I remember in 2000 many analysts thoughts Amazon was dead, but here it is in 2011 and they are thriving.
I'd like to think that single feature companies regularly DO make history.
Sometimes single feature companies become the heart of big successful companies once acquired. I think of Google buying Applied Semantics, which brought them what would become the most successful business model on the Internet.
Sometimes single feature companies have huge influence. Facebook LIKES are direct descendents of the Digg button.
Sometimes single feature companies get huge. YouTube is now the second biggest website on the planet, and it's pretty much good for one thing: watching videos.
Sometimes single feature companies change the world. Twitter is responsible for, among other things, accelerating the Arab Spring and Occupy movements. Not bad for something that's essentially text-messages-as-blog-posts.
Every company in Silicon Valley, including Apple and Google, started with nothing, and built something small at first.
The great ones keep growing.
Some great examples there. I guess we define single feature companies differently.
I'd call Digg, Twitter and YouTube full viable products. Even if they started or stayed simple and focused around their core feature.
I don't think history will be written around Applied Semantics but that is at least as much because it is harder to be a history-worthy B2B company than a consumer company as it is because it is a feature that needs a bigger ecosystem to work. AdSense and AdWords are historic, but became part of Google's legacy.
History will not be written about TwitPic, Hot Potato or Octazen even though they were successful. It won't be written about twitter clients that were killed by an official one. If you write an add feature to somebody's product even if you are successful before being acquired or made redundant you'll eventually be forgotten.
At some point the more philosophical of us are going to look back and think, "Maybe we should have funded some adults out there solving real world problems like energy, education, and healthcare instead of indulging in a frenzy of heavily funded college kids building games to water non-existant plants and marketing devices to take 50% margins on channel sales to small mom and pop businesses."
You reminded me of the bias in Silicon Valley to fund repeat co-founders under 30.
Estimates of YC classes suggest 15-20% over 30.
Even YC's Jessica Livingston says she would not have started a company at 25 because she didn't know anyone who would be a good co-founder.
People under 30 in general do not have enough real world experience to solve problems like energy, education, and healthcare. There are, of course, exceptions.
Adam.. those of us in that over 30 category (ahem) are perhaps more aware of what the benefits of a successful exit might mean for our communities, and greater society. Rather than heading straight into the next bling thing I think there is an element of social responsibility for us to pay it forward and make a difference to the lives of others. We may not be solving world hunger with our products but we are thinking long term about where our products will lead us to next. :)
Zuck talked about this at StartupSchool. I believe there are still plenty of startups working on a BHAG/vision to change the world.
There has always been a class of folks who look to 'flip'. The phenomena accelerates a bit and gets more noticed in times of exuberance. So I am not so sure if there is anything special about now as compared to late 90's or early 80's or other times even earlier. Is there?
I'm looking forward to a history that is not written by email. :)
You know, I'd like it if there was some general registry of all the startups in Silicon Valley. New ones I've never heard up cross my radar every day!
Are the founders to be blamed completely for the the pump and dump phenomenon? I believe some of this mentality comes from the investors as well.
Even if the mentality comes from investors, the founders are who are ultimately accountable for what happens to the business.