

New Rules for the New Internet Bubble - terrisv
http://steveblank.com/2011/03/18/new-rules-for-the-new-bubble/

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dminor
It doesn't look like a bubble on the scale of previous bubbles because the
general public is largely uninvolved (from an investing standpoint). If it
popped now, the burned VCs and angels wouldn't even make the local news.

On the other hand, if the IPO market heats up coincident with a strong
economy, then watch out.

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brianbreslin
well the ipo market heating up would then in turn involve the general public.
imagine people clamoring for facebook stock? coupled with resurging economy,
you get an interesting bubble action, as people will invest more than they can
afford to and risk more than they should.

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anigbrowl
I don't know - fund managers might well wish to pile in, but people in general
still seem to feel burned by the recession and wary of the market. The tech
bubble in the 90s took off from a position of much higher consumer confidence
as I recall.

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acconrad
_sigh_ We're in a bubble, we're not in a bubble...where are we, guys? If
anything it feels like a VC purgatory. Blanks advice doesn't really amount to
more than "keep doing Lean Startup, but think of companies looking to acquire
as a type of customer as well." The 3/4 of both the blog post and the
presentation will be nothing new to anyone who has been here for some time
(and the last 55 slides are "backups"). The last quarter has some conflicting
advice, "now's a better time than ever to be lean" but "seriously invest in PR
so you can be acquired." It's a bit disconcerting that for a guy whose mantra
is to create a lean business that is self-sufficient (i.e. without venture
funding), he's advocating that people pivot their businesses so that they can
be acquired. This article just feels like scaremongering.

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RuadhanMc
I equate bubbles with cycles. So in that sense we're always in a "bubble" of
some sort. The question is are we at the bottom of the bubble, the mid-point
or the top. It's everyones job to workout at which point in the cycle we are
so that they can adjust the risk that they are willing to take accordingly.
Thus the constant speculation.

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csomar
I think start-ups needs to get physical in some ways. Way too much
information, nowadays. While Facebook and RSS feeds me like food does, I get
enough of it that I don't want to try the next app. There is too much apps and
too much information.

By physical, I mean startups like Wake Mate. They make use of technology, the
web, mobiles, your computer... but they give you something more than just
virtual-information. Something physical is happening. There is an important
added value here.

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pedalpete
I've always disliked the idea that a physical good has more value than a
virtual or knowledge good.

It's about creating value. A pet-rock is as valuable as a virtual rock.

If a competitor to wakemate was able to monitor your sleep without the
wristband and was only a piece of software, would that make it any less
valuable to you?

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arepb
2011-2014.

Okay, looks like I've got three years.

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nbashaw
I don't understand this:

 _During the the Lean Startup era, the advice was clear; focus on building the
company and avoid hype. Now that advice has changed. Like every bubble this is
a game of musical chairs. While you still need irrational focus on customers
for your product, you and your company now need to be everywhere and look
larger than life. Show and talk at conferences, be on lots of blogs, use
social networks and build a brand. In the new bubble PR may be your new best
friend, so invest in it._

The only justification Steve gives for hype-seeking is that this is a game of
musical chairs. What does that mean?

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acconrad
The hidden message is he's eating his own dogfood: he's pivoting lean startups
to maintain relevancy while priming for a bubble by finding the change in
market as a way to re-advertise the Lean Startup methodology. It's a numbers
game - the higher your exposure, the greater your chances of finding the
company that just so happens is looking to acquire you.

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tspare
I think we are in a bubble in the sense that none of this family of companies
(facebook, zynga, groupon, twitter) increases the overall productivity of
society as a whole (or even their user base for that matter) and yet still
garnering such high valuations. Whereas if you look at the last generation of
tech companies (especially google) did in fact increase the productivity of
the overall society.

I think the overall emphasis on marketing is an outcome of commoditization of
software. In an earlier hn news item, OReilly talked about the thing that is
adjacent to whatever is commoditized becomes valuable. I think in the case of
software commoditization, that adjacency is data. User data has become much
more valuable because it is now the biggest moat that can protect a tech
business. Its no longer the software and hardware The more ability you have to
collect and monitize the data, the more defensible your business becomes. The
only way to collect more user data is to have an effective funnel driven by
marketing.

Thats my 2 cents anyway.

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erikstarck
I disagree. What Twitter and Facebook both do is decrease the cost for new
ideas to spread - HUGE value to society.

Twitter and Facebook are my primary news sources - and I'm not alone. I doubt
the protesters in the Arab world would agree when you say Facebook and Twitter
adds no value to their life.

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tspare
Yes, the Arab protester does show the potential of facebook/twitter for
productive use. However from my point of view, facebook and twitter will be
more like TV. On the surface it looks like it has a great potential for
spreading of ideas, but I don't think it would actually reach that potential
where it actually improves the overall productivity of society. I hope I am
proved wrong...

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icey
What's the likelihood we're in a bubble if everyone says we're in one and
investors continue to pour money into tech?

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dreamux
People aren't always rational, especially with money.

<http://en.wikipedia.org/wiki/Greater_fool>

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icey
I wonder how bad the first .com bubble was for big investment firms in toto.

I know it was bad for the market, but how bad was it really for the investors?

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thekevan
Wow, I am going to disagree with Steve Blank but I don't think it is a bubble.
In a previous comment, I referred to it as a bulge as I do not think it will
be nearly as extreme as the previous bubble.
<http://news.ycombinator.com/item?id=2336204>

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jdp23
There's a lot to like here, including this: "Like every bubble, this is a game
of musical chairs. While you still need irrational focus on customers for your
product, you and your company now need to be everywhere and look larger than
life."

But is it realistic to plan on the bubble going on through 2014?

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revorad
Not sure about the blog post, but the linked Johnny Cash song is worth a
listen for the hilarious analogy and well, it's Johnny Cash.

