3 ms·

I think one of the big reasons you don't see startups changing the world anymore is that the name of the game has changed from 'go public' to 'get acquired'. M

by dreamux 16y ago

I think one of the big reasons you don't see startups changing the world anymore is that the name of the game has changed from 'go public' to 'get acquired'. Many game changing technologies that big companies have released in the past 10 years (since the dot-com crash) have been through acquisition. With the IPO market now completely stagnant, its nearly impossible to aim for a public offering... and your investors want an exit. Its not about changes in innovation, its about changes in exit strategy.

jonny_eh 16y ago
Is this a problem just in the US? Why don't we see more tech IPOs in other countries such as Canada?
- yummyfajitas 16y ago
  Canada lacks the startup ecosystem (so few homegrown IPOs), and changing countries is tricky. Moving your flag while keeping your offices in the US is even trickier - you run into risks like double taxation (e.g., paying taxes on profits in Canada, then paying taxes in the US when you move the money from Canada to the US). Also, the benefits of being traded on TMX are not as large as the benefits of being traded on NASDAQ. Lower liquidity, the "huh?" factor, etc. That could change if many companies move to TMX, but there is a Chicken&Egg problem here.
juiceandjuice 16y ago
I'm not one to bash software, but software only goes so far in radical innovation. I think the reason you don't have the radical innovation is because everything has tipped heavily towards web and consumer/convenience oriented innovation. This isn't a bad thing, the costs for writing code are much smaller than R&D costs for most anything else, and it puts people to work and solves problems. There are still some companies like Tesla/SolarCity in the valley (or technically, on the East bay) changing the name of the game, but even Tesla is valued less than Groupon, for instance.
- pnathan 16y ago
  I think this is one of the key factors: most of the buzz today is orienting on what amounts to entertainment for the moneyed. Since the moneyed, well, have money, they buy it, and thus the company does well. What makes my life 1% more fun does nothing for someone in a third-world country. This is compared to, say, 50 years ago, where something that made my life better, e.g., an advance in refrigeration tech, could be distributed out to the third world better. I'm pulling examples out of a hat here, and I'm sure that other and better examples could be found. There are a ton of more fundamental projects done by companies, people, and universities out there. But they don't get the buzz right now, generally speaking.

by dreamux 16y ago

jonny_eh 16y ago

Is this a problem just in the US? Why don't we see more tech IPOs in other countries such as Canada?

yummyfajitas 16y ago
Canada lacks the startup ecosystem (so few homegrown IPOs), and changing countries is tricky. Moving your flag while keeping your offices in the US is even trickier - you run into risks like double taxation (e.g., paying taxes on profits in Canada, then paying taxes in the US when you move the money from Canada to the US). Also, the benefits of being traded on TMX are not as large as the benefits of being traded on NASDAQ. Lower liquidity, the "huh?" factor, etc. That could change if many companies move to TMX, but there is a Chicken&Egg problem here.

juiceandjuice 16y ago

I'm not one to bash software, but software only goes so far in radical innovation. I think the reason you don't have the radical innovation is because everything has tipped heavily towards web and consumer/convenience oriented innovation. This isn't a bad thing, the costs for writing code are much smaller than R&D costs for most anything else, and it puts people to work and solves problems. There are still some companies like Tesla/SolarCity in the valley (or technically, on the East bay) changing the name of the game, but even Tesla is valued less than Groupon, for instance.

pnathan 16y ago
I think this is one of the key factors: most of the buzz today is orienting on what amounts to entertainment for the moneyed. Since the moneyed, well, have money, they buy it, and thus the company does well. What makes my life 1% more fun does nothing for someone in a third-world country. This is compared to, say, 50 years ago, where something that made my life better, e.g., an advance in refrigeration tech, could be distributed out to the third world better. I'm pulling examples out of a hat here, and I'm sure that other and better examples could be found. There are a ton of more fundamental projects done by companies, people, and universities out there. But they don't get the buzz right now, generally speaking.