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Is it just me, or are big-ticket gambles no longer viable in today's Valley culture? The article mentions that "Ultra local services like Uber, Lyft, Instacart

Is it just me, or are big-ticket gambles no longer viable in today's Valley culture? The article mentions that "Ultra local services like Uber, Lyft, Instacart, ZeroCater, Chewse, etc. are raising more cash than world domination disruptive ideas." Add this to an underwhelming W13 Demo Day in terms of said WORLD DOMINATION and I'm starting to wonder if investors are losing their edge. There's plenty of opportunity for truly revolutionary disruption in all sorts of sectors. I just don't hear about it. As someone with disruptive ideals (but outside the valley) am I just being paranoid or is there really a problem?

michaelochurch 14y ago
I think the problem is that most of these VC-funded startups are seen as loaded to the hilt on one kind of risk (red-ocean grow-fast-or-die gambits) so they avoid all other kinds of innovation, which is why they are such uninspiring places if one looks at the actual work and culture. I know someone who's trying to run open allocation and his investors said "no", because they didn't want the added risk. VCs are swinging for the fences more than ever, but that means they're loading up on one kind of risk (rapid execution risk) and have no space for any others. At any rate, I think "world domination" is a pretty pathetic goal. Where are the companies that want to focus on excelling rather than simply "dominating" some market?
- RKoutnik 14y ago
  So the issue is less risk-adversity and more focus on a certain "ideal" risk. Interesting. As to "world domination," it's more a joking term for startups that are creating a new product that intends to replace what the market currently has [0]. Imagine a product designed to replace college as we know it. Incredibly risky? Absolutely. Crazy payoff (in cash and actual change)? Just as absolutely. I just don't see these kinds of ideas anymore. Maybe we all forgot to remove our schlep blinders, maybe the community has been focusing elsewhere, maybe they exist and have been avoiding premature hype. Probably a mix of all three. [0] Think Google/Heroku, not more mobile apps/anything social media
  - michaelochurch 14y ago
    I think that acq-hires ruined the ecosystem. The whole concept is parasitic. Acq-hires exist because failed companies (that the market should be clearing out) have had severe trust breakdowns and are incapable of discovering talent within, which renders them unable to do important projects (because they don't know how to find the people to staff them) so they have to buy validated talent at a panic price. If a company is trust-sparse (that is, most people have the "bozo bit" on) then I'd rather let the market kill it than keep moving around deck chairs, leaving investors to think there's still something there. That applies both to startups and acquiring companies. Let these trust-sparse, uninspiring husks die already. With acq-hires in the mix, the game is no longer about profits (so 20th-century) or building a business. It's about getting attention-- TechCrunch coverage, user count (which is meaningless), notoriety, and headcount (because valuations are multipliers on number of people)-- rather than building technology. So it's no surprise that the big winners are class-A marketers making quixotic, red-ocean plays.
    - RKoutnik 14y ago
      As usual, those who are in it for the cash ruin it for those of us who just want to build something cool. Thanks for the extended explanation, I feel like I've learned more from this thread than the rest of HN this past week.
      - tptacek 14y ago
        If you want to build something cool, push MIT licensed code to Github, or write a kernel module for FreeBSD. The complaint that businesses are in it for the cash doesn't make sense.
        RKoutnik 14y ago
        You're under the impression that "something cool" is strongly typed to code. In reality, there's much more that can be done. Building an organization to make something happen is much more difficult than pushing to GitHub and usually requires outside investment.
prostoalex 14y ago
Cleantech kinda collapsed on many large VCs, so to boost the returns to somewhere within the range expected by LPs, the capital is deployed into clearer monetization paths. http://www.mercurynews.com/business/ci_22385874/kleiner-perkins-john-doerr-falling-behind-after-betting http://www.mercurynews.com/business/ci_22385874/kleiner-perk...
Cherian 14y ago
This does not mean companies like “ Uber, Lyft, Instacart, ZeroCater, Chewse” are any way inferior. Maybe these markets are much more bigger than perceived. Maybe they have the capability to expand to other cities. Maybe the founders are very strong in their conviction. This is an observation.
jaredhansen 14y ago
How are Uber and Lyft not "world domination disruptive ideas"? The others I can see maybe, but completely revamping the automobile part of urban travel is a pretty big deal as far as I can tell.
- rdouble 14y ago
  Are they "completely revamping the automobile part of urban travel?" Tesla and even ZipCar seem more world-dominate-y in that regard.
  - jaredhansen 14y ago
    IMHO anything that cost-effectively shifts the responsibility for the actual driving from "me" to "somebody else" is almost automatically more disruptive than anything that doesn't. (Note the cost-effective requirement, which is important.) Uber, Lyft are in the "self-driving car" category, not in the "more resource-efficient car" category. Put another way, they conserve a resource (attention) that is far more scarce than fuel, cash, etc.
    - rdouble 14y ago
      I use Uber when I'm in SF. It seems like a very San Francisco specific service. I would never use it in NYC because I've never had problems getting a cab and the cabs already take credit cards. I would also not use it in any other city I've been in the USA because they are so spread out I always have to have my own car, anyway. Uber mostly seems like a better way to hail a cab in SF because hailing a cab there was previously next to impossible. I am not sure how relevant it is in other cities but it will be interesting to see how they do.
      - joecurry 14y ago
        If you think the only city that is difficult to hail a cab in is SF, you are sadly mistaken. I can personally say Austin, Atlanta, Baton Rouge, New Orleans, Athens, etc. desperately need a better way to hail a cab.

michaelochurch 14y ago

I think the problem is that most of these VC-funded startups are seen as loaded to the hilt on one kind of risk (red-ocean grow-fast-or-die gambits) so they avoid all other kinds of innovation, which is why they are such uninspiring places if one looks at the actual work and culture. I know someone who's trying to run open allocation and his investors said "no", because they didn't want the added risk. VCs are swinging for the fences more than ever, but that means they're loading up on one kind of risk (rapid execution risk) and have no space for any others. At any rate, I think "world domination" is a pretty pathetic goal. Where are the companies that want to focus on excelling rather than simply "dominating" some market?

RKoutnik 14y ago
So the issue is less risk-adversity and more focus on a certain "ideal" risk. Interesting. As to "world domination," it's more a joking term for startups that are creating a new product that intends to replace what the market currently has [0]. Imagine a product designed to replace college as we know it. Incredibly risky? Absolutely. Crazy payoff (in cash and actual change)? Just as absolutely. I just don't see these kinds of ideas anymore. Maybe we all forgot to remove our schlep blinders, maybe the community has been focusing elsewhere, maybe they exist and have been avoiding premature hype. Probably a mix of all three. [0] Think Google/Heroku, not more mobile apps/anything social media
- michaelochurch 14y ago
  I think that acq-hires ruined the ecosystem. The whole concept is parasitic. Acq-hires exist because failed companies (that the market should be clearing out) have had severe trust breakdowns and are incapable of discovering talent within, which renders them unable to do important projects (because they don't know how to find the people to staff them) so they have to buy validated talent at a panic price. If a company is trust-sparse (that is, most people have the "bozo bit" on) then I'd rather let the market kill it than keep moving around deck chairs, leaving investors to think there's still something there. That applies both to startups and acquiring companies. Let these trust-sparse, uninspiring husks die already. With acq-hires in the mix, the game is no longer about profits (so 20th-century) or building a business. It's about getting attention-- TechCrunch coverage, user count (which is meaningless), notoriety, and headcount (because valuations are multipliers on number of people)-- rather than building technology. So it's no surprise that the big winners are class-A marketers making quixotic, red-ocean plays.
  - RKoutnik 14y ago
    As usual, those who are in it for the cash ruin it for those of us who just want to build something cool. Thanks for the extended explanation, I feel like I've learned more from this thread than the rest of HN this past week.
    - tptacek 14y ago
      If you want to build something cool, push MIT licensed code to Github, or write a kernel module for FreeBSD. The complaint that businesses are in it for the cash doesn't make sense.
      - RKoutnik 14y ago
        You're under the impression that "something cool" is strongly typed to code. In reality, there's much more that can be done. Building an organization to make something happen is much more difficult than pushing to GitHub and usually requires outside investment.

prostoalex 14y ago

Cleantech kinda collapsed on many large VCs, so to boost the returns to somewhere within the range expected by LPs, the capital is deployed into clearer monetization paths. http://www.mercurynews.com/business/ci_22385874/kleiner-perkins-john-doerr-falling-behind-after-betting http://www.mercurynews.com/business/ci_22385874/kleiner-perk...

Cherian 14y ago

This does not mean companies like “ Uber, Lyft, Instacart, ZeroCater, Chewse” are any way inferior. Maybe these markets are much more bigger than perceived. Maybe they have the capability to expand to other cities. Maybe the founders are very strong in their conviction. This is an observation.

jaredhansen 14y ago

How are Uber and Lyft not "world domination disruptive ideas"? The others I can see maybe, but completely revamping the automobile part of urban travel is a pretty big deal as far as I can tell.

rdouble 14y ago
Are they "completely revamping the automobile part of urban travel?" Tesla and even ZipCar seem more world-dominate-y in that regard.
- jaredhansen 14y ago
  IMHO anything that cost-effectively shifts the responsibility for the actual driving from "me" to "somebody else" is almost automatically more disruptive than anything that doesn't. (Note the cost-effective requirement, which is important.) Uber, Lyft are in the "self-driving car" category, not in the "more resource-efficient car" category. Put another way, they conserve a resource (attention) that is far more scarce than fuel, cash, etc.
  - rdouble 14y ago
    I use Uber when I'm in SF. It seems like a very San Francisco specific service. I would never use it in NYC because I've never had problems getting a cab and the cabs already take credit cards. I would also not use it in any other city I've been in the USA because they are so spread out I always have to have my own car, anyway. Uber mostly seems like a better way to hail a cab in SF because hailing a cab there was previously next to impossible. I am not sure how relevant it is in other cities but it will be interesting to see how they do.
    - joecurry 14y ago
      If you think the only city that is difficult to hail a cab in is SF, you are sadly mistaken. I can personally say Austin, Atlanta, Baton Rouge, New Orleans, Athens, etc. desperately need a better way to hail a cab.