I agree this trend the investor posited to pg is a good one. It will force startups to focus on profits not hype and VC.
That will make for better startups that can perhaps become longlasting companies.
Facebook is all hype. That is not the formula for a longlasting company. As long as the hype is high, they are in good shape. How long does hype last? Our society is more deficient in sustained attention than ever thanks to the internet. Facebook needs to acquire any Facebook alternatives early and often. People are more than ready for the next new thing.
There is no value in data itself. You have to do something with it to produce income. You need a plan. Facebook lacks a plan. Facebook will stand as a good historical example for those who wantonly collect personal data and dream of its value. The amount of personal data Facebook has collected is unparalled. But that does not magicaly create a business. Unless the business is cold calling or some similarly annoying tactic to generate sales.
Facebook's business is running on hype, not data. If the hype slows. It traffic dies down, it's game over.
The idea that the sucess of Facebook is just a matter of flipping the switch and asking Facebook's users to buy things is unsupported by any evidence. However we have the dot com bubble as an example that just acquiring users without a solid business plan is not enough. Grow big, fast, is not enough. Facebook dreamers still think it is.
As investors see that the general public understands that Facebook has no plan, as reflected in the media, and that only have lots of users and personal data, investors will be more cautious. Investors read newspapers. And they believe what they read.
The hype wears off. People see that these companies are smoke and mirrors. And suddenly you can't pull another Groupon so easily.
I agree this trend the investor posited to pg is a good one. It will force startups to focus on profits not hype and VC. That will make for better startups that can perhaps become longlasting companies.
Facebook is all hype. That is not the formula for a longlasting company. As long as the hype is high, they are in good shape. How long does hype last? Our society is more deficient in sustained attention than ever thanks to the internet. Facebook needs to acquire any Facebook alternatives early and often. People are more than ready for the next new thing.
There is no value in data itself. You have to do something with it to produce income. You need a plan. Facebook lacks a plan. Facebook will stand as a good historical example for those who wantonly collect personal data and dream of its value. The amount of personal data Facebook has collected is unparalled. But that does not magicaly create a business. Unless the business is cold calling or some similarly annoying tactic to generate sales.
Facebook's business is running on hype, not data. If the hype slows. It traffic dies down, it's game over.
The idea that the sucess of Facebook is just a matter of flipping the switch and asking Facebook's users to buy things is unsupported by any evidence. However we have the dot com bubble as an example that just acquiring users without a solid business plan is not enough. Grow big, fast, is not enough. Facebook dreamers still think it is.
As investors see that the general public understands that Facebook has no plan, as reflected in the media, and that only have lots of users and personal data, investors will be more cautious. Investors read newspapers. And they believe what they read.
The hype wears off. People see that these companies are smoke and mirrors. And suddenly you can't pull another Groupon so easily.