There’s a weird feeling afoot these days, in the Valley, and in San Francisco. Across the rest of the world — Denver, Santiago, Toronto, Berlin, “Silicon Glen,” “Silicon Alley,” “Silicon Roundabout“, Station F — it seems every city still wants to be a startup hub, dreaming of becoming “the new Silicon Valley.” But in the Valley itself? Here it feels like the golden age of the startup is already over.
Hordes of engineering and business graduates secretly dream of building the new Facebook, the new Uber, the new Airbnb. Almost every big city now boasts one or more startup accelerators, modeled after Paul Graham’s now-legendary Y Combinator. Throngs of technology entrepreneurs are reshaping, “disrupting,” every aspect of our economy. Today’s big businesses are arthritic dinosaurs soon devoured by these nimble, fast-growing mammals with sharp teeth. Right?
Er, actually, no. That was last decade. 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.
The web boom of ~1997-2006 brought us Amazon, Facebook, Google, Salesforce, Airbnb, etc., because the internet was the new new thing, and a handful of kids in garages and dorm rooms could build a web site, raise a few million dollars, and scale to serve the whole world. The smartphone boom of ~2007-2016 brought us Uber, Lyft, Snap, WhatsApp, Instagram, Twitter, etc., because the same was true of smartphone apps.
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.
But there is no such revolution en route. The web has been occupied and colonized by big business; everyone already has a smartphone, and big companies dominate the App Store; and, most of all, today’s new technologies are complicated, expensive, and favor organizations that have huge amounts of scale and capital already.
It is no coincidence that seed funding is down in 2017. It is no coincidence that Alphabet, Amazon, Apple, Facebook, and Microsoft have grown from “five big tech companies” to “the five most valuable public companies in the world.” The future belongs to them, and, to a lesser extent, their second-tier ilk.
Source/More: After the end of the startup era | TechCrunch