
Silicon Valley’s Undertaker: "We're Anticipating a Major Fallout" - jamesjyu
http://www.pehub.com/115158/silicon-valley’s-undertaker-‘we’re-anticipating-a-major-fallout’/
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vitalysh
10 megs for that tiny cemetery picture? peHub needs to learn how to resize
pictures. Resizing in browser is the worst idea ever.

[http://morningjoy.files.wordpress.com/2009/08/mountain-
cemet...](http://morningjoy.files.wordpress.com/2009/08/mountain-cemetary.jpg)

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rbanffy
Bandwidth consumed must be one of their traffic metrics.

or

That's what you get when you give an 8-core, 16 GB RAM box to your interns.

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mathattack
On the one hand, the article can be depressing - each fallout is a dream that
died. On the other hand, one of the things that makes the Valley succeed is
it's capacity to celebrate failure. A mistake? What did you learn? Now move
on!

Companies that facilitate this are part of what makes for such a healthy eco-
system.

Compare this to Japan - much of their lost decade(s?) was caused by an
inability to accept failure, and shut down unproductive firms.

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jpdoctor
> much of their lost decade(s?) was caused by an inability to accept failure,
> and shut down unproductive firms.

Unfortunately, the systemic Japanese malaise was a failure to shut down
insolvent financial firms.

Kinda like the US today. (Let's face it, the VC ecosystem is mice nuts
compared to the greater economy.)

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mathattack
In Japan it was a 2 tier issue. Insolvent (Zombie) banks were allowed to stay
open. They in turn kept many insolvent companies alive. It's a testament to
the strength of the Japanese that they kept the game going on for as long as
they did. Of course it's not an exact analogy, but I share your concern that
in the US we are trending towards a "Keep them open" mentality, rather than a
"Try and try again".

A recent quote from Michael Jordan has been making the rounds: (& I believe
the real @ is much higher than 9000)

"I've missed more than 9000 shots in my career. I've lost almost 300 games. 26
times, I've been trusted to take the game winning shot and missed. I've failed
over and over and over again in my life. And that is why I succeed."

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eric-hu
"In terms of the younger companies, what do you have to unwind exactly? What
sorts of assets do they have to sell off?

Things have definitely changed. I remember in 1999, 2000, I would sell a used
server for $35,000 and I had a line of people wanting it. Today, a server is
$5,000 and you can get an okay server for less than $2,000. [In the meantime],
we’ve probably become one of the largest sellers of [intellectual property] in
the country. We sell tons of IP, and as you know, the IP wars have started, so
we play with the big guys, the little guys, and the in-between guys. During
the last bubble, there weren’t as many patents. It was more ideas and URLs. So
the business has matured."

I hope this means that tech patents will prove to be a fad.

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sp332
It reminds me a little of trading baseball cards. The cards were mostly
worthless. But "Tops" published a book that basically _defined_ what the cars
were worth, and speculation was done based on what Tops might publish in the
next edition. The market eventually collapsed. The same thing might happen
with software patents, when people realize that there is no inherent value to
owning a patent.

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j_baker
I think it's important to realize that leaders of these kinds of companies are
no different from the leaders of any other company: they need to be upbeat
about the company's prospects to a certain degree. The part that makes them
unique is that they can't talk up their business without talking down another
part of the economy.

I'm not saying that Pichinson's prediction about there being a Social Media
fallout is wrong so much as I'm saying that you should take it with a grain of
salt. He has financial incentive to talk the Silicon Valley economy down.

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Triumvark
I wish we knew more details on which "clean tech" firms were going under...
sounds buzzwordy.

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tatsuke95
My guess would be over-funding.

When the government incentivizes an industry through grants or tax-breaks, you
get an oversupply . "Clean Tech" is a hot area right now; as cities try to
attract business to dig themselves out of red-ink, it's just the type of
industry they'd like to see (as opposed to, say, pork rendering) coming to
their area. So it gets subsidized. Hence there are more borderline sustainable
businesses in the space.

Here in Canada we witnessed this with tax incentives for installing solar
panels.

