Last evening, Svante sent me a link to Paul Graham’s essay on what Web 2.0 is. Earlier in the week, I listened to a podcast by Om Malik and Niall Kennedy about the condition of Web 2.0 startups and the idea of “Selling Out”. And I’ve been keeping up-to-date on the “build-to-flip” meme (meaning, building a company and aligning it for the sole purpose of selling out or being acquired by a bigger fish).
Perhaps I’m a bit late to join the fray, but sometimes it takes me a while to process all my various inputs. Sometimes, I have a sense of what is wrong (I can just feel it) but I’m not quite sure what’s bugging me: at least I can’t put it into words quite yet. Then out of the blue, I get the final piece and all the elements seem to gel in my mind. Aha! The link that Svante sent me last night was that final puzzle piece.
Paul Graham characterizes Web 2.0 startup entrepreneurs as a few guys (usually tech-savy instead of business-savy) with an idea and intent to simply start something good. It’s about building something of value to the users; trying to solve a problem that hasn’t been solved yet (or solving it in a different way). In my mind, the “build-to-flip” scenario is to create something, based on previous hype, purely for purpose of profit. In Paul Graham’s mind, this would be very anti-web 2.0. And in my mind (and I think Om Malik and Niall Kennedy would both agree), a company without substantial intentions is a high-stakes gamble where the cards are against you.
I believe that Paul Graham’s assessment of Google’s past success is dead on: the very nature of Google is that it is perfectly aligned with the way of the web. When you move with the flow of the river, it’s easy; a simple adjustment here and there and you are set for success. Graham describes it best:
Google doesn’t try to force things to happen their way. They try to figure out what’s going to happen, and arrange to be standing there when it does. That’s the way to approach technology– and as business includes an ever larger technological component, the right way to do business.
Building to flip is going against the grain of the web, simply because it doesn’t champion the user. It champions the profits, the user comes at a distant second. Selling to a bigger company, or being acquired does make sense, but only if it makes sense to the user: utilizing a larger corporation’s resources and assets to better the service or product.
On a side tangent, sometimes when I step back and look at TripTie, I find it funny that nowadays you can build a website and call it a company. Of course, there is more to it than just a website: there is the business model behind it, the resources, the intellectual property, etc. But from the vantage point of a foreigner, it’s just a website; a website we call a company. In the not-so-distant past, I would have called it a project. Maybe the grown-up word for “project” is “company.” Or maybe, this is truly what Web 2.0 is: when you start to envision that thing you are working on as more of a “project” and less as a company.
