
Why Silicon Valley innovation has stalled - antr
http://pandodaily.com/2013/01/03/why-silicon-valley-innovation-has-stalled/
======
jerf
"Using the medical analogy, the current environment in the internet space
essentially tells people that they will make more money as a pre-med dropout
opening clinics than as a serious researcher looking for a cure for cancer."

You say that like you aren't aware it's a true statement? You have terrible
odds of becoming rich being a cancer researcher.

It's a hard problem to solve, though. The obvious answer of "route more money
to cancer researchers" produces the obvious social attack of "more marginal
people being or simply pretending to be cancer researchers", for instance.
It's easy to get "more money" -> "more researchers", it's much harder to get
"more money" -> "more _research_ ". (I'm not saying it's impossible, just that
it's a lot harder than it looks.)

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dasil003
Innovation is doing fine. All these whiny bloggers and investors simply can't
see the forest for the trees. The reason there are so many trivial startups is
because the web is now a mature market and the barriers to entry have fallen
to the point that anybody can jump in. Time will show that most of these ideas
are worthless and not very many people are getting rich off fart apps, but for
now it's a gold rush plain and simple.

Fundamental innovation in tech is in hardware and software standards, neither
of these things is suffering. The evolution of web standards is moving faster
than it ever has. Hardware is making steady progress. Cloud computing is
making big strides. Things are moving just as fast as ever, it's just obscured
by the mass market noise that is obscuring the big picture.

Now obviously a lot of this stuff is incremental, but guess what: computers
and networks aren't new anymore. The level of innovation from 1980-2000 was
special because it introduced the power of general computing to the majority
of the population. It's not a matter of simply working on harder problems to
replicate that. It's one of a few evolutionary sea changes like mass
production/automation, railroads, wired communications, or space flight.
Nothing short of the singularity is going to appear that amazing, especially
with the compounding effect of nostalgia.

~~~
daemin
Sort of like saying that the era from 1980 - 2000 was about making computers
and computation visible, and now we're trying to make it invisible so that we
no longer have to explicitly think about computation, it just is.

------
pnathan
If you want to find ground-breakingly new tech & ideas, don't look at your
average 2012 startup. Look at PhD dissertations or the output of
Microsoft/Google/IBM research. Those people are paid for new ideas that don't
make money. :-)

Real ground-breaking tech comes from deep work & deep knowledge. It also comes
from trying out ideas and watching the "99 lightbulbs that don't work". It
turns out failing costs money, and groundbreaking work is hard to fund. In
general, that is sort of the idea behind research labs not producing
monetizing products: all they do is work up ideas. Maybe the ideas are usable,
but statistically, most of those ideas aren't going to make money. Think very
hard about that. As an investor or a founder, you have to be prepared to lose
your money on some faffy idea that might be so far beyond the current
worldstate that no one would buy it. The interested reader is advised to
examine Common Lisp company history in the '80s for a classic case study. Or,
alternatively, the Connection Machine.

Real innovation/groundbreaking ideas are exotic (a priori, this is what makes
them the real deal). So there must be some sort of ability on the part of the
company to transform the society into being ready for this idea.

Put another way, research is even more black swan than startups.

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niggler
Innovation happens in fits and spurts -- it's highly nonlinear.

More importantly, there is a positive feedback cycle between what the author
would consider "true innovation" and "trivial apps" -- before we can make a
very large leap in terms of true innovation, we need some societal comfort
with the paradigm. Those apps (like Twitter, the one Peter Thiel derided)
serve a very important role: they move the bar culturally. These apps help
acclimate people to the idea of technology (for example, owning and keeping a
smartphone close to you) and make sure that society is ready for whatever next
innovation happens. Without the societal leg of the cycle the "true
innovation" will be stymied.

~~~
david927
Honestly? I think that's what investors(and the trivial startups who court
them) tell themselves as they tuck themselves in at night.

Innovation, like a new tree, has many branches which can be developed and on
which to exploit and make money. Exploiting innovation is lucrative; research
is costly. But now we've over-grazed. We got so greedy that we threw
everything into harvesting the leaves, forgoing the costly part of sowing new
seeds, and now we're navel-gazing and wondering what happened. It's not hard
to understand.

In WWII there was a ton of investment into important research and the results
were overwhelming. Currently there is a ton of investment into photo-sharing
social networks for dogs, and the results are, surprise!, quite underwhelming.

~~~
niggler
Whether an innovation is lucrative or not depends _highly_ on cultural
factors. Ultimately to exploit an innovation there needs to be something to
exploit, and unfortunately that is almost always _other people_.

Many companies have produced tablets for decades before Apple came in with the
iPad. If the iPad were launched in the early 90s, for example, it would not
have taken off in the same way it did now.

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pm90
Excellent article. I've seen a lot of my friends get disheartened by the idea
of spending the time and effort to do a PhD and instead hoping to make it big
by trying a variation of the "chain of clinics". While this is strictly their
personal choice to make, I think their intelligence would have served better
learning the field more thoroughly; after which they would have probably been
an invaluable asset...

A lot of them feel that getting a PhD would make them overqualified to work in
the industry.

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mattgreenrocks
Let's ask a simple question: how many people _really_ want to change the
world? Not just disrupt, but eliminate an entire class of fundamental human
problems? And how many people would settle for simply being rich? The allure
of success can be highly seductive.

The market has spoken, and it's rewarding people with little to no vision. It
makes it OK to water down grand visions.

Fix the culture to stop focusing so much on being the top dog. This is a very
difficult task.

~~~
pavel_lishin
> _how many people would settle for simply being rich?_

Forget being rich, I'm willing to settle for financial security for my family.

~~~
mattgreenrocks
Isn't that a more noble subset of being rich?

I completely understand, mind you.

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patrickk
" _I doubt there are many, or any, engineers who don’t have deep aerospace
experience working in the SpaceX engineering department._ "

And yet Elon Musk had no experience in the field prior to founding SpaceX.

He even went to Russia to try to buy a refurbished ICBM before going down the
path of hiring aerospace engineers and building rockets in-house.

Excellent documentary on Musk: <http://vimeo.com/38542529>

------
carterschonwald
It hasn't stalled, its just hard to quantify, it can't be strictly measured in
press and consumer intelligibility.

Likewise, most businesses are not strictly innovative in a
scientific/technological sense, merely in having a clever synthesis of
preexisting tech that does something people will pay for.

There are a lot of innovative tech / engineering shops being created and or
growing each year, but they're a bare fraction of the total number of
businesses being created. (And all businesses have a web site these days, so
clearly that's not tech ,,:-p )

The kicker is we're kinda already in an amazing future. We actually understand
pretty well how much / little we truly know in most endeavors. Sadly, human
psychology does get bored and demand ever more exotic novelty.

Being innovative in sci-tech and having a self sustaining business With
_RECURRENT_ are not often happily wedded, and every successful fusion should
be cause for celebration.

Likewise its actually really hard to evaluate what _IS_ innovative if you're
not a domain expert. Etc etc etc

Usual caveat, I'm trying to fix numerical computing at wellposed, so I'm a bit
overthinking about innovation always.

------
michael_miller
I disagree with the premise of the article. Yes, there are a lot of people
dropping out of college saying "Oh Zuckerberg did it, I should do it too!"
without a sane business model. Yes, there are a zillon daily deals startups
which will probably all go bankrupt in 6 months. Yes, there are a ton of
social media startups that allow you to take a photo and share it for 10
seconds with all your friends. And there are definitely more of these startups
than usual, due to the funding environment.

However, there are also many "serious" startups. Tesla, transforming the
primary mode of transport for most Americans. SpaceX, reinvigorating space
exploration. Palantir, integrating the world's data to save lives. There have,
and always will be, these startups doing serious world-changing innovation.

I picture Silicon Valley as a funding pyramid. The best companies are at the
top, and always get funding. Then, at the bottom of the pyramid are the daily
deals startups. In a less hot funding environment, these companies wouldn't
get funded. But in the current climate, a ton of companies at the bottom of
the pyramid are getting funding. Since there are way more of these bogus
startups than serious ones in the current climate, we just hear more stories
about them.

~~~
cube13
>However, there are also many "serious" startups. Tesla, transforming the
primary mode of transport for most Americans. SpaceX, reinvigorating space
exploration. Palantir, integrating the world's data to save lives. There have,
and always will be, these startups doing serious world-changing innovation.

Are any of those actually startups anymore? SpaceX has over 2000 employees.
Palanir has over 400. Tesla had it's IPO in 2010.

They're just companies, they've all delivered products to market, and are(with
the possible exception of Tesla, depending on their 2012 filings) making a
profit.

~~~
hack_edu
"Once a startup, always a startup" is the rule of the day these days.

Makes me wonder how long HP would be considered a startup if they were born
today.

------
javajosh
On the scale of innovation, it's important to note that a computer program
will never be a flying car, or antigravity, or a cure for cancer. It won't be
anything physical, by definition. For the most part the total output of any
application can be specified as a sequence of pixel bitmaps, and the utility
of that sequence is subjectively measured by the person interacting with it.
Applications can't do any more than acquire data and generate bitmaps. I only
say this to emphasize that it's important to set your expectations before
getting "disappointed" in the state of software innovation.

The other thing about innovation in software is the need to distinguish
between _application development_ as distinct from _computer science_. Writing
an application is very different from writing an algorithm! Much of the
"boring innovation" happening right now is about application development, not
computer science. Once we accept this we can start making clearer calls about
what kind of innovation we think is stagnating.

------
Mvandenbergh
I don't think is caused so much by fewer people doing truly interesting work
as it is by a greater number of people doing fairly trivial projects.

In other words, it's not that resources that could have gone to "serious"
projects are being allocated instead to easy projects. The author even says as
much, different people are doing those jobs.

------
ttunguz
The innovation in the past 5 years in tech dwarfs the past. Monsterix has a
great list of the innovations that have been developed recently and
complaining about the lack of innovation is sloth - a lack of willingness to
get out and speak with the companies that are building non-linear tech.

~~~
zobzu
Not sure what Monsterix is, but I have a feeling that innovation is "new way
to bounce stuff on the screens" "new API for X", "new protocol for Z", etc.
Those aren't innovations, IMO.

------
xxchan
That there's a lack of real innovation might just be an illusion that is
created by too much focus on stories about how much money this or that startup
raised. Same way how if you watch news and read magazines, one might start to
believe that the world is in a very sorry state.

------
BrianEatWorld
Perhaps Thiel, Arrington and the author are taking too much of a top down view
of the issues.

To stick with Thiel's hyperbole, I think we don't have flying cars because we
still haven't fixed the issues with the road bound ones. Its great to have
grand aims at revolutionizing the world, but lets not forget the big impact
something as small as 140 characters can have. There are third world countries
where entire economies have grown out of the ability to text message. Only a
few years ago we saw entire swaths of the Middle East get big quality of life
improvements thanks to wall posts and tweets.

------
orangethirty
I don't think it has stalled. Its actually pretty healthy. Every day I see
posts here of people working on greta projects. My own projects are actually
pretty innovating (and challenging), so I can personally attest to it.

I do believe that people are now used to a constant supply of groundbreaking
news from SV. So, even though we are working at a pretty good rate, theit POV
will be skewed from that need to always have their mind blown by some awesome
app. A lot of innovation happens under the hood and they never notice. Too
bad, though.

------
Skywing
Nothing directed at the writer of this one single blog post, but who are these
bloggers to be talking about innovation? They all use the same blogging
platforms and write the same articles. And why have blog posts of this topic
started to appear? Arrington writes something and all other blogging websites
feel like they have to get a piece of the story trend pie and write a similar
post, as well? I'm sorry but these are the kind of posts that make me shake my
head.

------
zobzu
Personally, I'm looking into the possibility to work at SpaceX, exactly for
such reasons. I feel like I can't do anything "remotely important" at any job
I've found in the silicon valley, and i haven't done any innovation myself
that i deem to be "really changing something that I believe in".

So I though, I might as well help a company that does just that, even if I'm
not going to be the one designing the actual rockets.

------
purplelobster
I find the most exciting innovation in software happening now is in computer
vision and machine learning. To me, these counts as true innovations. Most
internet technology however is just engineering with fairly obvious solutions.
There's nothing wrong with that, but it's not innovations if you're just
pushing what's possible on the internet, but not pushing what's possible
overall.

------
michaelochurch
_in order to push the innovation envelope, people must be working at, or at
least have a deep knowledge of the current cutting edge of innovation._

I agree, and that's a full-time job that _has_ to be self-directed. Excellence
is a nonlinear phenomenon. A person who excels in 10 hours of his time and
subordinates in 30 isn't 25% as someone who gets to be full-time excellent,
but possibly 1%.

I spent 6 months at Google, a company that has some awe-inspiring R&D "centers
of excellence" but is essentially just a bank if you don't get to work in one.
Now, I'm sick of ragging on Google because I think I've overdone that schtick.
On the other hand, with the incredible wealth of talent it has got, it can do
a lot better. It's the best a closed-allocation company can be, and it has
amazing people. But my experience there is instructive on the mediocrity that
closed allocation command-and-control creates. If you don't have worker
autonomy, you won't get creativity or excellence or innovation.

Google remains awesome because the ~25% who get to be Real Googlers (they can,
like Yegge, quit their projects and join better ones, because teams compete
for them) have enough autonomy to do really good work and keep pulling the
company, but if you're not a Real Googler, you're going to be working on 4th-
Quadrant crap. (For the definition of "4th-Quadrant", go here:
[http://michaelochurch.wordpress.com/2013/01/01/fourth-
quadra...](http://michaelochurch.wordpress.com/2013/01/01/fourth-quadrant-
work/) .)

After that, I worked in a reputable (but diseased) NYC startup-- a VC
darling-- with serious ethical problems at managerial levels (multiple people
hired into the same leadership role; dishonesty about product direction used
to keep people motivated). To my chagrin, the culture there was traditional
MBA-style corporate bullshit: closed allocation, supernumerary people with
fancy titles who didn't do much, extremely vicious politics (I resigned when
asked to sign affadavits disparaging engineering old hands with too much
equity).

The Valves and Githubs excepted, these "hip" tech startups are not
_culturally_ innovative, and it's the prevalence of the old-style corporate
culture that makes them all devolve into grey-goo mediocrity.

Subordination is a genocidal killer of innovation, and the cultures of these
"hip" tech startups are often not much different from large corporations in
culture, creativity, innovation, or ethics. For every Valve, there are 100
companies that claim to be "startups" but are just as hierarchical and
command-oriented. The hierarchy isn't as deep with only 100 people, but it's
every bit as dysfunctional.

If we want innovation out of these startups, we have to focus on culture. We
have to stop funding culturally retarded people with MBAs just because they're
"credible" and, instead, look for people who can lead very smart people (an
extremely rare skill).

~~~
javajosh
_> We have to stop funding culturally retarded people with MBAs just because
they're "credible" and look for people who can lead very smart people (an
extremely rare skill)._

With all due respect, you have to articulate better than that. I agree that it
sucks that command-and-control types seem to be loved by capital as leaders of
organizations. But isn't the real culprit here on the demand side? E.g a
problem with the capitalists? How do you convince them that a) cultural
innovation is a winning move and b) _you're_ the guy to get it done?

The other issue here is that it's a lot of moving parts. Presumably at a
startup you're already innovating in at least one area. Now you're talking
about innovating in an orthogonal area. If my experience as an engineer is any
indication, introducing one new technology is somewhat risky, the risk for two
sky-rockets, and at three you might as well not start the project.

Give a friendly audience the pitch!

~~~
michaelochurch
"Culturally _retarded_ " wasn't intended for offense. Retarded means "delayed"
or "behind the times" and I couldn't think of a better word. I am no fan of
the colloquial use of "retarded" (making a slight on people who, through no
fault of their own, have congenital cognitive problems) but that's not what I
was going for.

 _How do you convince them that a) cultural innovation is a winning move and
b) you're the guy to get it done?_

These VC darlings grow too fast and hire before they trust. That's their
original sin. If you can't trust someone with his own time and effort (open
allocation) then don't fucking hire that person.

~~~
cma
If you are going to retain the ability to fire people, you are still
subjecting them to hierarchy. Except now you have a narrower channel of
communication--they can only ask: was I fired today or not?

And if you open more communication with the implied threat of firing, you are
back to a traditional managerial relationship.

~~~
michaelochurch
Well, I'm a fan of open allocation. People aren't beholden to one manager.
They work for the company.

Two cases of firing that I see:

1\. Objectively unethical or toxic. Leakers, people who arrogate power in
power vacuums, people who insult colleagues, people who break the law. Fire
them. Don't wait a day. This is less than 1%.

2\. People who can't fit anywhere in the organization. You need to get rid of
them, but you have time. They might be a solid "5" or "6", but they'll never
be a "8". There's just no fit. Give them a generous severance and a good
reference. Let them use the office and represent themselves as employed during
the search. Treat them as alumni and leave them feeling good about the
company.

3\. People who are not doing great where they are. Let them find a better fit
(open allocation). If they don't have the initiative for that-- not everyone
does-- see #2.

That's the right way to fire people. It's a serious and important function and
it shouldn't be used as punishment. You fire because you have no other choice.

Then firing isn't about power. It's a necessary and unpleasant duty that keeps
the company from falling to pieces.

------
monsterix
Frankly, it is extremely boring to read articles like this. The heading "Why
ABC innovation has stalled" itself sounds quite artificial.

Here is how innovation seems unfolding itself lately (Both in Silicon valley
and outside of it):

Early stages of 3D printing, cars that drive themselves, drones that are cheap
and interesting, gestures which lend themselves to web, voice processing and
response at higher level, interesting touch surfaces where the buttons grow
out of the screen depending on software interface, banking and virtual
currency to kick ass of the arcane and so on ...

Here is (probably) the problem of tech blogs apparently. You guys have gone
too close to investor community, or have started believing in the hype machine
too much. Open your eyes and report on start-ups outside of 'likes' and
'tweets' and 'pluses' (Not that those are not news).

Open your eyes, probably.

~~~
monsterix
Down-vote Pandodaily? That's surprising.

~~~
david927
No, I down-voted you.

The elephant in the room for the valley is that nothing is happening. Randomly
select a startup from AngelList and tell me what you think of it. Is it
creating something innovative or is it a new application for existing
technology? And now we've exhausted permutations for
social/sharing/tweet/feeds. It's old.

Yes interesting research areas exist. They always have. But what we're talking
about here is the proportion of those, especially in the valley, to what the
average startup is working on.

~~~
monsterix
> Yes interesting areas exist. They always have.

Okay. So now search for start-ups involved around those interesting areas.
Don't just down-vote generally on an article like this which borders on flame-
bait.

On the other hand, I also accept your down-vote (it is your karma ultimately,
not mine) but that doesn't change a thing. According to me it's just plain
stupid to claim that innovation has stalled because one is unable to figure
out 5 awesome start-ups from a crowd of 50,000 wannabes. Period.

