Will Social Kill Real Startups?

What are the implications of Facebook and Instagram posting mega returns after just a short time in business?

If you were going to build something new today would you aim for the long term or try to piggy back on the social wave?

Steve Blank says VCs have already made up their mind:

If investors have a choice of investing in a blockbuster cancer drug that will pay them nothing for fifteen years or a social media application that can go big in a few years, which do you think they’re going to pick? If you’re a VC firm, you’re phasing out your life science division.

Kind of a scary thought. It’s almost akin to Hollywood where they follow the money and copy-cat as much as possible. Spiderman made a lot of money? Great! Let’s make 20 more superhero movies. They’re bound to succeed!

The good news is that now, more than ever, you can create an internet startup with very little capital so maybe we don’t care that the VCs are chasing social.

And as Nicholas Taleb warns in his famed Black Swan book, just because Facebook made $16 billion in social it does not mean that it will ever happen again…

Leave a Reply

Your email address will not be published. Required fields are marked *


You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>