Technology investing, and why the bust is good for the industry Re: Corporate transparency

Owen Byrne owen@permafrost.net
Wed, 9 Jan 2002 03:53:09 -0400


On Tue, Jan 08, 2002 at 11:46:15PM -0600, Jeff Bone wrote:
> 
> 
> Owen Byrne wrote:
> 
> > What I was saying was that the model of funding that you are involved with is an aberration specific to the dotcom industry,
> 
> The environment today *is* an abberation of the dotcom industry, just as the environment of '98-'00 was.  But neither is really my mental model of how technology investing usually has
> occurred:  I started and funded my first company back in 1993/1994, pre-boom, when most VCs couldn't spell "Internet,"  so I've seen the full cycle first-hand.  Believe me when I say that I

Would I have heard of it? Interestingly I think I started my first company in 1993. Didn't go anywhere - course I was in school, and had a new girlfriend - lots of
excuses to quit. 


You on Coase == Me on Drucker. This theory of his seems pretty unverifiable, although it sounds comforting for the future, and "most of the sustainable ..." tends to
agree with my world view.

Owen

> --- but we'll instead see a steady flow of increasingly mature and grounded companies sprout up that address real-world problems on which pricetags can be placed.  (Cf. Drucker:  every true
> boom is actually a sustained growth over time, and is preceeded by about a decade by a "boomlet" that fails.  Most of the sustainable companies and most of the value in a cycle of new
> industry / innovation is actually created after the boomlet.)
> 
> What we're seeing right now isn't the failure of capitalism, it's the triumph of capitalism;  the failure of various capitalists and entrepreneurs is providing us with a spectacular
> demonstration of the robust and adaptive behavior of the system as a whole in balancing resource allocation where it should optimally be.
> 


Ahh well, all the poseur entrepreneurs can go back to being management consultants and leeching off the big corps instead of the small guys. That's gotta help
the small guys.

Owen