Startups are dead, long live big business

Startups are hot… “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.”

Exerpts from “After the end of the startup era” Posted on  at TECHCRUNCH. by Jon Evans , Columnist

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.

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From here on in, the existing tech titans will accrue ever more power, and startups will be increasingly hard-pressed to compete. It is widely accepted that the next wave of important technologies consists of AI, drones, AR/VR, cryptocurrencies, self-driving cars, and the “Internet of Things.” These technologies are, collectively, hugely important and consequential — but they are not remotely as accessible to startup disruption as the web and smartphones were.

AI doesn’t just require top-tier talent; that talent is all but useless without mountains of the right kind of data. And who has essentially all of the best data? That’s right: the abovementioned Big Five, plus their Chinese counterparts Tencent, Alibaba, and Baidu.

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Hardware, such as drones and IoT devices, is hard to prototype, generally low-margin, expensive to bring to market, and very expensive to scale. Just ask Fitbit. Or Jawbone. Or Juicero. Or HTC. (However, in fairness, software and services built atop newly emerging hardware are likely an exception to the larger rule here; startups in those niches have far better odds than most others.)

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Self-driving cars are even more expensive: like biotech, they’re a capital-intensive battle between huge companies. A few startups may — will — be expensively acquired, but that’s not the same as having a realistic chance of actually becoming major competitors themselves.

What’s more, startups bring fresh approaches and thinking, while hidebound behemoths stagnate in their old ways of doing things. But for the next five to ten years, thanks to the nature of the new technologies coming down the pipe, those behemoths will just keep accruing ever more power — until, we can hope, the pendulum swings back again.

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Michael Jabs – Totally agreed! Now, it will be up to the big corporations to create a kind of start up mentality to hire those talents from start up companies that are needed to drive all these new technologies