A Bubble-Era VC Is Itching To Get Started Again
from the invest-now dept
The title to this article is a bit misleading. I was all set to complain that the VCs who just now are starting to invest again probably missed a few years of incredibly cheap investments. However, the real point of the article is much better. The VC in question, Fred Wilson, has a theory that I agree with entirely. He’s saying that technology companies, themselves, are in trouble. Technology is increasingly a commodity business – and as new technologies come along, they’re better than old ways of doing business, but they don’t offer the same ability to make money – directly. For instance, using VoIP instead of PSTN phone systems lets you do much more, but no company is going to collect as much as the phone company does now with their “tollbooths”. So, where’s the action? He seems to believe (as I do) that all this commoditization of technology is a huge opportunity for companies that use that cheap technology to solve specfic problems. So, basically, he’s betting on the indirect results of technology, instead of the direct profits. It’s an important distinction, and one that many companies are in denial about – especially if their business is being eroded by new technologies.