1999 2.0: There will be no links out to stories about VC funding in this post. That’s because I promised myself a long time ago to never again read (much less link to) stories about early stage VC investments in start-ups. This post may also sound like I’m whining, but I’m not. I don’t fault anyone for raising VC money and am happy for them and wish them all the best for creating and finding funds to build a company that will hire lots of people and prosper and change the world.
I’m just making an observation.
The first go ’round (1999 1.0) of tech bubbling was, in my opinion, misinterpreted by nearly everyone involved (the media and analysts, the public, the financiers, the entrepreneurs and especially, me) because the story stopped being about the reality of what was taking place (the Internet changed us radically, or have you noticed?), and became about the absurd financial expectations of those who history quickly displayed, had absolutely no idea of what was going on.
It was a financial bubble, not a technology or communications or cultural bubble. All that money being pumped into dubious ideas made for great headlines, but when the money became the story, it took a boom-and-bust cycle to ring-out the crap from the system.
And then after that, somewhere around 2002-2003, back when no one would invest in anything, it actually seemed fun again to watch new things being created by people who were being pushed by passion and curiousity and the desire to connect with other human beings (David Weinberger calls that love.)
I believe one of the most heinous contributing factors to the implosion of the 1999 1.0 economy were those daily alerts announcing who got how much VC funding. It became like a Chinese torture drill as I was often asked, “what do these people do and why do they need $5 million to do it?” (My answer: “It’s so they can issue a press release that will attempt to scare off the 50 other people doing the same thing they are doing.”)
Hey. I’m a capitalist. I love monetizing things and building value and growing companies and entrepreneurship. But when it comes to who I am cheereing for to get rich during 1999 2.0, I’m rooting for those from the Jason Fried school of keeping it small and real rather than those who base their business plan on, well, how to package it for VC funding and an exit strategy, rather than on passion to create a great product.
Again, I’m sure you can have passion to create a great product and also get VC funding before you even have a real business, but that’s just not who I’m rooting for.