Hyper-connected blogger and tech luminary Robert Scoble, just wrote a great post called “Why I’m treating startups more critically lately.” Of late, Robert finds himself meeting with lots of crappy, over-funded, digital startups that desperately need more time in the oven, an intervention by Dr. Drew, or more likely, Dr. Kevorkian. (My choice of words, not Robert’s!) Not only am I seeing the same things, but I’d take it a step further.
I believe this current crop of entrepreneurs might actually be hurting America – and perverting the very idea of innovation in the same way Beyonce’s Run The World is like kicking Aretha Franklin in the ribs…repeatedly. All is not lost. Keep reading…there are ways to take advantage of this situation, though it’s too late to save this song:
“Innovation” for and by the YouTube GenerationYesterday, Justin Kan, the bright young founder of video streaming site Justin.tv, posted Generation Make on TechCrunch, He writes:
“We’re making our own way and making our own jobs…We don’t need your jobs, your advice, your instruction. Pretty soon we won’t need your music labels or publishing houses; we’ll be doing it ourselves on iTunes and Amazon.”
While I admire Justin’s can-do spirit and terrific achievements, he’s spent far too much time around other ambitious, hungry entrepreneurs. He is the exception, the elite. 99% of his peers are not peers at all; they don’t build streaming websites, they snack on Cheetos while streaming planking videos. They have the same sense of entitlement, selfishness, and ‘screw The Man’ attitude Justin alludes to, minus two important things – talent and the drive to work at it.
The latest US generation has led a life of leisure. Arab protesters carry swords and machetes, ours carry iPhone 4S’s in pink, personalised cases. The resulting innovations and their inventors reflect that hardship-free aesthetic. In many ways, this latest wave of digital entrepreneurs takes the easy path. It’s easy to start a web site. It’s easy to make an app. It’s easy to do anything that doesn’t require big capital investment, physical infrastructure, or a fleet of trucks driven by beefy, middle-aged men named Al or Tony. Things like Angry Birds, coupon sites, and social networks look like the pets of America’s great inventions from the past – flight, electricity, assembly lines, cars, the internet, Ike and Tina Turner.
From computers to desks to chairs used by cute digital startups like Oink or Bizzle or FoSchnizzle, – it’s all made possible by better, more substantive innovators. This superior breed of entrepreneurs and inventors toils away in relative obscurity, often in Asia, solving real, complex problems. They squeeze 32GB onto something the size of mint strip. Or, they make un-killable batteries that let us Tweet deep into the night. They make solar cells worthwhile or water out of thin air.
Back in the US, a stunning surplus of VC cash and leisure time feeds this feeble form of innovation – where getting something to scroll from the left instead of right can be considered a breakthrough. It’s not that the entrepreneurs aren’t smart or capable or impressive, its that the market doesn’t demand they try that hard. Why build a plant when someone will give you $300 million to collect email addresses for a daily deals site?
The real risk of all this is the same thing that happened in the banking industry – disproportionately high incomes driven by distortions that siphon talent away from productive industries to unproductive ones. There is real demand for top engineers and inventors to commercialize new ways to harness ocean water. Instead, that talent can be found gambling onfictitious investments or perfecting the trajectory of a freshly killed digital pig. Multiply that situation by thousands and you have:
- A country completely disconnected from real world problems faced by the rest of the world (like, no water) Entrepreneurs missing out on a chance to make money to solve those problems The US falling farther behind and deeper in debt as its biggest talent counts clicks from within a narrowing, darkening, digital consumer bunghole
- A country completely disconnected from real world problems faced by the rest of the world (like, no water)
- Entrepreneurs missing out on a chance to make money to solve those problems
- The US falling farther behind and deeper in debt as its biggest talent counts clicks from within a narrowing, darkening, digital consumer bunghole
By the way, I am not saying there is no room in the world for entertainment or leisure-oriented innovation, but I am saying if we want to continue getting those Lenovo’s from China, they’re not going to accept our Tweets or Oinks as payment.
What’s next and so what?
As the market purges these lackluster companies, disposable incomes continue shrinking, and resource costs rise as emerging markets consume more, American innovation will need to step up. We will need to build the kinds of things Indians and Chinese will buy. You and I know they won’t be buying Oink or Bizzy. China can and will make their own inane, ridiculous apps. My new book,Econovation is all about what’s in store for the US in the next decade and what innovations will be in demand. Other than buying dozens of copies for you and all your friends (immediately!), there are some other things you should consider right now:
- Immediately start putting your pitch together for any kind of digital, social, mobile, adorable buzzword startup you have in mind. The time will never be better to get it funded! …those days are numbered. For now, it’s like taking candy from a baby (coincidentally, that’s the premise of my forthcoming mobile game company, Furious Babies)
- If you are an investor, you probably know that no one cares about that new RSS reader app you funded. Save your money for a business that makes something real. I know it’s not in vogue, but it will be…read my book.
- For inventors who know they can solve real world problems, there is no shortage of them – start now! Get your pitches ready. Your time is about to come. And, government will dance the Macarena to help you. More on that in future posts.
- If you are a parent, glue posters of real innovators all over your kids’ walls. I’m not above suggesting electrified security in case they try replacing them with pictures of The Jonas Brothers. Don’t settle until your kids do this when they see Ajay Bhatt:
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