There were, of course, some differences in the latest series of Silicon Valley splashes. In retrospect, it seems that the dawn of the consumer’s Internet was the emancipating call for anyone who had ever harbored the slight-est aspiration to be an entrepreneur. For the first time the majority of companies were started by people with liberal arts backgrounds rather than degrees in computer science or electrical engineering. Suddenly, everyone could register a domain and cobble together a Web site. In the pandemonium that followed, it was easier to form a company than to open a corner store, publish a newsletter or start an auto-repair
shop. Also, for the first time, the flow of information about a new enterprise became close to perfect: an Internet company started in Santa Clara County would almost always be cloned a few weeks later in Shanghai, Stuttgart or Stockholm.
intelligence, video games, local area networks, information technology service companies, and wide area networks. It does not take much notoriety to transform one example of success into a fad. It also takes only one poorly managed company intent on buying market share at any cost to create a bloodbath in any category.
It doesn’t matter whether it is the spring of 1971, 1981, 1991 or 2001: there are a few things that, I suspect, will always be true about Silicon Valley. Every new decade will only spawn a handful of companies that deserve to become enduring members of the Nasdaq Stock Market. Most of the companies organized in the valley will become product lines of larger companies, features of product lines of larger companies or they will fail.
But if that seems too bleak or cold an assessment, it is hard to conceive of a place where the rules of real success are better understood than Silicon Valley. There will always be massive opportunities for any companies that solve a real need for lots of customers. The most acute of these needs usually will only be
solved by the commercialization of some new technological development. On the whole, companies that answer burning problems will quickly come to operate with high margins and start to generate cash-the mother’s milk of all prosperity and the lubricant of growth.
It is a pretty simple formula. Every time we tinker with the equation or delude ourselves into believing that tomorrow will be different, we will get into trouble. Conversely, every time we stay true to what has worked and help to form and organize companies run by people with a real passion for their business, sympathy for their customers and desire to make money, we will be participants in something that really does deserve the label “a bigger splash.”