The Myth of the Tech God Is Crumbling
wsj.com
wsj.com
You can get people to follow you, for a while, via coercion or threats. This is way harder if they can walk away. Better to get people wanting to participate in your adventure, making it their adventure as well.
I don't think it's implausible that someone like that, if sufficiently smart, would be able to succeed and squander all competition. I would not personally work for someone like that and I am privileged enough to be able to make that choice, but I do think that plenty of people would if they think it will benefit them in the end.
It's not clear to me that there is a trend away from this dynamic in society.
Since a competitive tech company depends on good software engineers, and since anyone can band together and raise VC money, you can't survive long if you're not a good boss. Access to capital is now restricted due to the recession but there's still a need for software talent so they have options.
The only exception is people on H1B visas who have to hold on to the job until they find another (or get deported) and hence have to tolerate a bad boss. You see this happening in Twitter with all the recent resignations.
since anyone can band together and raise VC money
Entrepreneurship is actually kinda rare, most people just want a safe salary and not worry about money or running a company.
I have no idea what we can possibly do about this short of sci-fi level genetic or chemical manipulation of future humans. It seems we'd otherwise have to rewind and replay at least the last few million years of evolution without scarcity and zero-sum competition.
It's folk wisdom but I think it is directionally correct.
Big Tech isn’t going anywhere. It will continue to grow. What will replace it? New Big Tech? There could be a small slump for a few years, but it’s a recession, right after everyone increased spending due to Covid. People all over are feeling the effects. It would only be newsworthy if tech was immune somehow
Google has a high chance of being disrupted by AI-assisted search agents.
Amazon is now mostly a cloud business with a grocery store attached. Cloud will get increasingly commoditized and margins will likely erode.
Facebook is a 50-50 bet on the metaverse being the next big thing.
Netflix depends entirely on lucking out on a successful show/franchise.
Apple and Microsoft’s moats seem way more defensible.
I doubt it, Google itself has some of the most advanced AI in the world, including Google Brain and Deepmind. For them to be disrupted means that something truly revolutionary has come about, and not from Google's own labs.
Google’s inertia comes from the fact that their entire organization is built around ads. An AI-powered assistant will likely not be monetized the same way.
I can totally see a situation where Google’s management rejects AI adoption because they can’t think of a way of monetizing it with their current models.
That feels VERY generous. They're making two big bets here :
1. VR will be a big thing (I just don't see it. I think it's gonna be like 3d)
2. They can dominate the market (also sound unlikely since Apple is working on it)
So yeah, probably a 20-80 and not a 50-50 bet.
Probably not defensive against antitrust action that simply defines a moat as anticompetitive.
Tech is full of smart people who build, run and invest in successful companies that have produced a tremendous amount of innovation. But the industry’s recent spate of failures and reversals has made one thing clear: Many of its leaders aren’t as smart as they thought they were.
Just this month, a pair of the world’s mightiest tech names, Amazon.com and Facebook parent Meta Platforms, announced broad layoffs after years of breakneck hiring. Another giant, Google parent Alphabet, came under pressure from an activist investor to slash its costs. Some of the biggest names in venture investing, including Sequoia Capital and SoftBank Group, were left trying to figure out what went wrong after FTX, the $32 billion golden child of the crypto boom, imploded. And Elon Musk, who perhaps more than anyone embodies the idea of the polymath tech genius, has made a mess of Twitter after paying $44 billion to buy it.
Silicon Valley has long seemed to operate on a foundational myth that its leading lights, having mastered an alchemy of electronics, code and early stage investing, are not just a breed apart, but could also defy the gravitational laws of business and investment that apply to mere mortals. According to their articles of faith, their special powers of disruption could transform any industry, while generating outsize returns making them worthy of magazine covers and tremendous wealth.
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Personally, I never thought a tech god existed. I have witnessed many more companies fail than succeed. In venture capital circles, they have one company succeed out of a hundred, and maybe one unicorn out of a thousand. And this is with people who evaluate companies *professionally.*
How could anyone with half a brain think there are "tech gods."
That the tiniest of a sliver of companies that make it...duh.
But, at least in my estimation, Amazon is not a tech company. It is JC Penny or Sears or Target, just got in with a better ordering system. Apple just built a better music player/phone.
At the risk of someone quoted that patent officer from 1900 or whatever, who I'm paraphrasing, said something to the effect of, "Everything has been invented and there's nothing left to invent."
Well, there's still stuff left to invent, but not as much as there was, and any new stuff will take a LOT more money, unlike the early days. Can a new OS be built and succeed? Hypothetically, yes. But Bill Gates built his with 10 or 20 people, and that sure isn't possible anymore. Google might, *might* be able to replace it with chrome, but that is frucking Google, and not Jack and Mary and Ahmed working in a basement.
It's like the old chestnut about gold in California in 1849. Everyone says they would sell the tools to the miners....yeah, right, except there already is a company doing that. And they have the best location in the biggest boom towns. The buy up all the tools from the tool wholesellers that come into the San Francisco Bay in advance, so all tools go to the existing tool merchants. The tool sellers have relationships with all the tool wholesellers, who are not going to sell to *you* as they are not going to risk their relationship with their biggest customer. As I said, the tool seller already has the best location in the boom town to sell their wares, and it's all about location, location, location. They got to the town early in the boom and own the land for a super cheap price when they bought it, but now with the boom, land is super dooper expensive - how is a one-man business going to even get a shop to sell their tools, if they can even get tools to sell in the first place? If it is even possible, you are going to be way, way, way off the beaten track. Plus, the existing tool seller is going to do everything in their power to put you out of business.
The first miner '49ers could actually pick up gold off the ground, or walk into a stream and pick up gold from the bottom of a stream - they were the first ones there. But after a blink of an eye, all the easy pickings were gone, and then you had to use sluices, start digging, all which was more time-consuming. Plus getting a claim became more and more expensive as time went on. And finally, you have hydrolic water cannons that used water cannons to shred a mountain to nothing but that took big investment from investors back east, and an individual could not compete.
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This is what is happened in the tech world. Being a tech god doesn't matter. The people who started unicorns got lucky. There were a lot of gold nuggets lying around on the ground. But they have been picked over.
Is it possible for another unicorn? Sure. But not like the old days. Unless someone is really, really lucky. Even in San Francisco gold rush, as it became more corporate, some lone dude could still find a vein of gold. It's just that the statistical odds were abysmal by that time.
The "tech gods" were about an extremely small number of men who found nuggets lying on the ground, but idiots ascribed them to be geniuses because they leaned over at the waist and picked the gold nugget off the ground.