Tuesday, April 10, 2012

Wake of the Flood

I've been struck by the massive adoption and now returns earned by the Instragram shareholders. It's just about as staggering as the incredible momentum around Pinterest and both are so notable for the reality that they delivered great user (and shareholder) value with around one dozen employees. Each has about one dozen employees, think about that. We last saw this so visibly when Yossi Vardi led a group of innovators who created, then exited, ICQ (and have seeded more new companies than I can count). 

Engineering and UI cultures, no sales forces, field customer service reps, hordes of system admins. Nada. 

On one hand these are screaming advertisements for capital efficiency, fundamental changes in the way companies can deliver value and innovative entrepreneurs. On the other hand, there's no doubt that Steve Jobs was only hitting the tip of the iceberg when he noted that the jobs exported from the US to overseas locations are not coming back. In fact, many of this generation's companies won't be creating those jobs in the first place.

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