Response to After the end of the startup era

Jon Evans wrote a piece for Techcrunch entitled: After the end of the startup era.

In it, Evans writes:

We live in a new world now, and it favors the big, not the small. The pendulum has already begun to swing back. Big businesses and executives, rather than startups and entrepreneurs, will own the next decade; today’s graduates are much more likely to work for Mark Zuckerberg than follow in his footsteps.

And,

Because we’ve all lived through back-to-back massive worldwide hardware revolutions — the growth of the Internet, and the adoption of smartphones — we erroneously assume another one is around the corner, and once again, a few kids in a garage can write a little software to take advantage of it.

Then states:

But there is no such revolution en route.

He lists five emerging technologies, AI, Hardware, Self-Driving Cars, AR/VR, and Cryptocurrencies, and lists reasons why the large will dominate.

From here on in, the existing tech titans will accrue ever more power, and startups will be increasingly hard-pressed to compete.

And concludes:

But for the next five to ten years, thanks to the nature of the new technologies coming down the pipe, those behemoths will just keep accruing ever more power — until, we can hope, the pendulum swings back again.

The article sparked a lot of debate and a lot of angry teeth gnashing.

And I thank him for his courage and contribution.

My take

It depends on what you believe about technological progress.

If you’re optimistic about technological progress, then you’d argue that there are a lot of angles to all five technologies, and a thousand other technologies that have not been enumerated. If you’re very optimistic, you’d argue that there are way too many angles for the big five to possibly cover.

If you’re pessimistic about technological progress, then you’d argue that anything that’s left to discover will be discovered by the giants and that’s it. There simply isn’t enough opportunity and so, as a result, the giants are going to dominate.

Your stance on progress shapes how you perceive Evans prediction of a 5 to 10 year dark age.

I choose optimism.

Optimism

People are inventive.

People with a lot of money and security are especially inventive.

 

There’s a lot of money sloshing out there. There has been for nearly a decade.

There’s some good security in many nations. Entrepreneurs are thriving in the West, where there is some intellectual property rights. There’s a lot of hacking by state actors that do not play by Western standards, which undermines our security. This has to be ultimately addressed in the end, because, without security, the progress stagnates, even with a lot of money sloshing about.

But for now, entrepreneurs have access to both money and security. And they remain, naturally, inventive.

The Big Five and the big five

A lot of people are looking for what’s next. What’s the next big billion dollar unicorn opportunity? It sure does feel like all the big things are all done, doesn’t? AI, Hardware, Self-Driving Cars, AR/VR, and Cryptocurrencies. All of them have deep patent trenches dug around them and social capital all locked up by Google, Facebook, Amazon, Apple and Microsoft. The future is cancelled folks. Pack it in.

Only that it isn’t. In AI, commercial application for unsupervised learning has only just begun. Hardware could be come interesting to Western Civilization if everybody starts playing by the same rules. Self-Driving Cars have a long way to go. AR/VR hasn’t consolidated so we’re a long way off there. Cryptocurrencies have yet to truly enter the bear trap yet.

I have to ask – do consumers want to buy many of those things from the big five? Do they have the brands to compete?

Look at all the opportunity outside of those big five.

Consider this:

There are 1.3 million lawyers in the United States.

How is that even acceptable?

Out there, right now, there’s some entrepreneur that wants to change that fact on the ground.

There’s a lot more out there outside the Big Five and the big five. Places where once pioneering firms won’t go, or can’t go.

There’s a lot more out there beyond the big five.

The End of the Startup Era…for San Francisco

America has chosen de-globalization for four years. A lot of other countries have chosen that as well. De-globalization has a profound impact on The Valley. Once the great attractor of talent, the great funnel into which all societies poured the cream of their technical elites, no more. It’s not as attractive.

De-globalization is not a sustainable strategy. China tried it (again) around 1500. They persisted through to the 1890’s with the self-strengthening policies, which was a good effort, but the fundamentals of the society had since come apart. In the end, the true cost of 450 years of isolation was sixty years of war.

America really can’t hide from the world on her own continent over the very long run.

For The Valley, the next five years may be dark if only because of isolationism.

For those outside, they’re likely to be very bright years given the combination of talent, capital, security, and the formation of brand new networks independent of the United States.

I’m optimistic.