The Ecosystem’s Body And Mind

For the past few years, everyone has publicly blogged and tweeted about whether or not the Valley is experiencing a “technology bubble.” The prevailing argument in support of there not being a bubble is that many of the big, growing startups of today have real revenues, solid fundamentals. If we think of the “body” as the fundamentals, things do appear to be in shape. Companies are growing, making money, addressing growing global markets, and we are definitely in a deployment phase of technology infiltrating even the least sexy of industries.

What about the “mind” then?

I started to think about this after watching this short video discussion between @Chamath (Social+Capital) and @JessicaLessin (The Information). I’d recommend watching the video above. Chamath covers a lot of ground about the frustration around mobile apps and why text is surging, or how the next Facebooks of the world will help us curate better content. The most interesting piece in my view, toward the end, is when Chamath starts talking about the potential “imbalance” in the SF Bay Area ecosystem, and specifically he models out why many late-stage private companies are potentially staring a world of hurt when public market prices are more rational. If and when that starts to break apart, he contends, it won’t hurt the general public, but it will likely hurt the rank and file employees at many growing startups.

These people, he contends, in turn, may start to leave the area and feel as if they were taken advantage of.

There’s an “American Dream,” and that’s been under all sorts of pressure as the proliferation of computing power in everyone’s pockets has helped reshape how business is done. There’s also a “Silicon Valley” dream (one that Chamath lived through), and while it appears to be the envy of the world, the implication and warning in this video is while the body/fundamentals are in great shape, the mind may not be.

Is the mind of SF Bay Area’s tech & startup ecosystem healthy? I don’t know the answer, but it’s a great question to ask and reflect on.