Entrepreneur - Silicon Valley
The Real Poop
Great successes oft have just one name because that's all they need: Washington.
Well, you get the idea.
Uniting them, there is a singular vision coupled with the right balance of arrogance, ignorance, and good timing that makes "greatness" out of "goodness.” And there's lots of dead meat in between.
The petri dish for billionaire successes in this era has been (mostly) Silicon Valley software developers. Young, super-smart (and lucky) kids out of school (mostly Stanford) came up with an idea that simply aligned with a violently changing, growing environment. They got good funding, advice, and a few favors.
And voilà, there was Apple, Yahoo!, Google, eBay, Amazon, Facebook…and more. In fact, you can bet that there are two teenagers whom you've never heard of, resplendent with zits, and they are this moment toiling in a garage somewhere in Palo Alto, CA, making something that will be "all the rage" ten years from now. They will be billionaires and you will admire and envy them.
Wanna be one of 'em?
You oughta. They have reallllly pretty jets. And awesome 5th homes. (So you can imagine what homes #1 through #4 look like.)
But much more prized than the money is the chi they win among their peers for having created something out of nothing (jobs too). Their achievements are the peak of the pyramid and well, the pique of the envious hard-workers who didn't execute, didn't get the distribution deal done, didn't get the right funding, just...didn't.
In Los Angeles, young kids dream of being movie and rock stars; in New York, the dream is an investment banker or hedge fund manager who moves to a cheaper tax state; in D.C. the dream is all about political clout; and in Silicon Valley, taking your own company public while you're still in or just out of college is pretty much the peak of the pyramid of Maslow.
So what's the secretsauce.com?
Mega-trends. Insane brilliance (Steve Jobs phrase). The "style" or form that most entrepreneurs have followed has been to align with some huge change in the ecosystem of technology, telecommunications, and infrastructure. And timing counts. You could have been the guru in Internet technology in 1972, but it didn’t matter. In those days, modems (the things that connect your computer to the Internet) were so slow and so expensive that downloading just one pretty picture took an hour. Assuming the line didn’t break in the middle.
The 1970s, courtesy of the Vietnam war and other global tensions (many revolving around oil), were all about defense technology. Fortunes were made building microwave radar-detection equipment and other kinds of high-tech snooping devices. The big buyer was the U.S. military, and the wealth was CIA-top-secret quiet.
In the 1980s, the telecommunications industry deregulated the monopoly held by AT&T and the local phone companies. There "had to be" competition and various legal changes made for a free for all to handle telephone calls in a different way. The phone industry had kept prices too high for too long and "faster, better, cheaper" was the new it phrase. Lots of routers got sold and Cisco came to prominence.
The 1990s were all about the Internet going commercial, consumer, everywhere. Yahoo, eBay, Amazon, and 500 other companies were funded. Many died. Few thrived. But those who did are huge now, and again, fortunes were made…albeit less quietly than during the Defense Era.
The 2000s were all about commerce. Selling stuff on the web. Cars. Houses. Crap. It got sold and Google was the big beneficiary, as it was the eyes and ears for finding…crap. And at 50 cents a click, it coined money.
The 2010s were all about social. LinkedIn, Facebook, Twitter, Zynga, and a bunch of other socially-oriented companies all made bank on the masses' loneliness, cluelessness, business, and a few other nesses (but not Loch). The fortunes made were those who saw this mega-trend early and invested heavily.
Why do mega-trends matter so much to entrepreneurs in this ecosystem? Because if you get the mega-trend RIGHT but the company WRONG, you usually still make bank. Why? Because in a big bull market where everyone is scrambling for a foothold in a new territory, even the losers get bought.
If you weren't Yahoo, maybe you were Excite, Infoseek, Lycos, or a handful of other "portals." If you weren't Facebook, maybe you were one of dozens of other small social networks who all got bought. If you weren't the King, it was just fine being a courtesan and hangin' in the castle with the good food and non-polluted water.
The best entrepreneurs generally came from backgrounds where they were dropping out of PhD programs to pursue their passions. Almost everyone in the software space is a PhD program drop out. It's kind of a badge of honor. And tapping into that group of entrepreneurs matters: How cool would it have been to be employee #17 at Facebook (with $100 million worth of stock options at the IPO)? That is, you don't necessarily have to start your own company to "make it" as an entrepreneur.
And we ALL-CAPSily note that "the Silicon Valley Way" is only one way to make a billion bucks. You can be a real estate mogul in China, an innovator of fast food for thin people, the creator of the ultimate chain of dry cleaner stores. Our window is just one in a skyscraping condo to the stars….