By mbaxter 18 Jun 2008 [0 Comments | 88 views]
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But that’s enough about inflation. Let’s turn instead to a future of opportunity.
Change is changing. There was a time when it would take years for a new big idea to take off.
| Consumer electronics products penetration in Europe – Source Philips | ||||||
| Product | Year of launch | 1st year | 2nd year | 3rd year | 4th year | 5th year |
| Cass Rec | 1963 | 0.1% | 0.4% | 0.9% | 1.6% | 2.8% |
| Colour TV | 1966 | 0.1% | 0.6% | 1.4% | 2.9% | 5.5% |
| Cass Deck | 1969 | 0.1% | 0.4% | 0.8% | 1.5% | 2.5% |
| VCR | 1972 | 0.1% | 0.1% | 0.1% | 0.2% | 0.2% |
| CD-Audio | 1983 | 0.1% | 0.4% | 1.0% | 2.9% | 6.2% |
| Cam-corders | 1984 | 0.2% | 0.6% | 1.2% | 2.2% | 3.5% |
Today, though, it is not merely that ideas take off more quickly, but it seems that the rate at which they are taking off more quickly is itself accelerating.
Nowhere is this more obvious than in the world of technology. Let’s face it, by past standards Microsoft is still a young company, yet today it sometimes seems like a throwback to a different age. Yahoo seems positively ancient, and even Google seems sluggish sometimes.
Take as an example, the saga with MySpace.
Google has of course gone from nowhere to the world’s most valuable brand in just a few years, yet it is already struggling to work out where the next innovation will come from. Just a few months before NewsCorp bought MySpace the social networking site was offered to Google for around $290 million. The company’s two bosses Brin and Page have foresight aplenty. Since their own particular company is the very model of stratospheric dotcom growth, the two men were no doubt used to seeing business plans with lots of noughts in the projections. Even so, they reasoned, it was an absurd price. You would have been hard pressed to disagree with them. Yet, a few months later, Rupert Murdoch came bursting on to the scene, said, “G’day†to MySpace’s founders, and offered $580 million. Had the Australian maestro finally lost the plot? Had his brains gone walkabout? Well, it seemed he was proven right. For while the ink on his $580 million cheque had barely dried, Google was signing a $900 million advertising deal with MySpace, and no doubt cursing along the way. It’s a fast growing business indeed when not even Brin and Page can keep up.
So social networking is the big thing today. Who knows how it will stay that way, and who knows where it is going.
But some believe the future of social networking is a specialisation, and they see business-to-business as the real money spinner of the future.
And that brings us to LinkedIn, the business-to-business networking site.
Bain Capital Ventures, Sequoia Capital, Greylock Partners and Bessemer Venture Partners have stumped up $53 million as an investment into the company. Yet, for their troubles they have received just 5 per cent of the business, meaning it is worth a cool $1bn.
Sequoia Capital, by the way, is the firm that originally backed Google. They also provided early finance for Yahoo, YouTube, Pixel Works, PayPal, even Apple. That is not to say LinkedIn will be the next MySpace (the author of this article has terrible problems with LinkedIn, by the way), but it is certainly worth watching this space.
