Over the past few weeks, I’ve noticed two themes in press and analysis around the tech world.
Theme #1 : Where has the innovation gone? This was represented best I think with this week’s cover of the Economist, asking whether we’ll ever invent anything as useful as a toilet ever again. This echoed folks like Michael Arrington who quipped that he was bored and Peter Thiel who griped that instead of flying cars, we got instead 140 characters.
Usually, when I hear lots of mainstream concern that innovation is dead, that’s when I start getting excited. The froth is coming out of the market, and the true innovation is out there, lurking, perhaps unrecognized (yet). But it’s out there, just waiting to delight.
So on one hand, I’m excited. Bullish about the future.
Theme #2: Thoughts on the Series A crunch. Lots has been written about the pending Series A crunch. I basically agree with Michael Maples Jr’s as quoted in a PandoDaily article, where he says (paraphrasing) that every year there are about 10 fantastic startup companies. Irrespective of funding environment, those 10 are the ones everyone wants to get into and those have little trouble finding funding. The goal is to start or be involved with one of those companies.
With that as context, I’ve read with increasing alarm the press that prominent incubators are putting out about how much follow-on funding their companies have attracted. Here was one such announcement just made today. I can understand why its useful and its not to take away from the work that incubators are doing to help companies get themselves started and off of the ground. I’ve never been much of a fan of funding announcements though. I’m more of a fan of announcements of big customer wins, market share achievements, and partners that are committing to your solution. That’s real traction and where you have those wins, funding will follow. I do worry that the signal from incubators on follow on financing is going to, if anything, prolong the Series A crunch.
These are just thoughts. The concrete action feedback, if you’re a startup, is to stay focused on winning in the market place through traction–customers, market share, partners, revenue, growth, etc.
Delight a rapidly growing customer base and the Series A crunch and the concerns on a lack of innovation in today’s tech market will magically work themselves out.