Web 2.5: A Dangerous Crossroads
Web 3 is not about to take over any time soon, especially given the damage that FTX and Sam Bankman-Fried have done to reinforced the public’s view that crypto (an element of Web 3) is rife with fraud and no, we have idea why Bankman-Freed isn’t in prison (‘Why aren’t you in jail already?’ Internet erupts after Sam Bankman-Fried confirms participating in New York Times’ DealBook). Yet according to MSN, We’re Witnessing the End of Social Media, and while the Age of Social was supposedly about ‘connecting,’ it has mostly been responsible for the disconnections that have been going on between people and groups.
So, we seem to be in a strange tech stasis: a no man’s land between the last and the next phase of tech.
Even FAANG – Facebook, Apple, Amazon, Netflix, Google stocks – isn’t FAANG anymore
Now it’s MAMAA – Meta Platforms FB, Alphabet, Microsoft, Amazon and Apple – although we propose MAMMAA, and although not stock related, Musk definitely belongs in the cabal mix and make no mistake about it: The Web 2 cabal is still alive and kicking – and not about to surrender their lead positions to the so-called next iteration of tech and yet a new crop of tech wunderkinds any time soon.
Holiday List for Founders: The Laws that Drive Success in Technology
Thanksgiving kicks off the holiday season and while tech never rests, those people on the money side of the table, be they potential investors, partners, or clients, do tend to slow down/take longer to make a decision or even take meetings.
As we well know, there’s little rest for the startup side of the equation, but here’s some not-necessarily-light holiday reading, the list courtesy of CBInsights, who asks, “What separates success from failure? These 11 laws contain some of the most influential ideas that the biggest tech companies use to run their operations, design business models, and build products.
Some, like Moore’s Law, have been extremely prescient. Others, like Conway’s Law, provide counterintuitive insights — such as why Microsoft sells Xbox consoles at a loss, or how Facebook became one of the most valuable companies in the world by offering a free service.”
Everything You’ve Been Told About Tech May Be Wrong
At the dawn of the Age of Social, tech bros built promised the world goodness and light – to bring the world closer together; to give everyone a voice – built walled gardens, amassed billions of users, made themselves more or less the only game in town and became a vital part of life. Which made them too big to fail.
Or so we’d been told. Often.
Yet by the end of September, Facebook’s Meta Lost Two-Thirds of Market Cap Value From 2021, NewsMax reported. Mark Zuckerberg Admits He ‘Got It Wrong’ as Meta Lays Off 11,000 Employees. At Least He Signed His Name. Twitter laid off 7500 employees – but at least Zuckerberg signed his name??? Which will no doubt make all the difference, especially once the benefits run out.
The Demise of Web 2.0: Ignoring Product-Market Fit
Anyone working on a startup – or an investor deck – knows that one of most important criteria to investors (besides what your company will do to ensure that they’ll see an exit at some point in their lifetime, or at all) is product-market fit, which is especially important at this juncture, given the downturn in the market. Although we will remind you once again that some of the biggest companies emerged during the worst of times.
That said, Big Tech is no more immune to the vagaries of the market and the importance of product-market fit than is anyone else, but one thing that they do have- so far – is deep pockets.
Does that really help? At Alphabet, “Revenue growth slowed to 6% from 41% a year earlier as the company contends with a continued downdraft in online ad spending,” said CNBC. It had missed analysts’ expectations. “CEO Sundar Pichai said in the statement that the company is “sharpening our focus on a clear set of product and business priorities,” while Ruth Porat, the finance chief, said “we’re working to realign resources to fuel our highest growth priorities.” So, does that mean so much for moonshots et al and, instead, sharpening the focus on what people do want, rather than what the company feels that they might or should want?
Don’t Look Now, But Elon Musk Just Flipped the Bird
Elon Musk’s purchase of Twitter has been finalized, there’s a new sheriff in town, and the tech press is up in arms.
Musk in control of Twitter, ousts top executives, the AP screamed.
And what company doesn’t replace senior executives after an acquisition?
This Is Meta Frightening
If you’re wondering why Mark Zuckerberg has poured some $15B into his metaverse project despite seeing ‘no results,’ according to the tech press, we’re wondering why no one pays attention to the man behind the curtain. Following its developer conference, Meta was roundly slammed for not being further along, given the amount of money their Reality Labs received to develop it, to the point where Facebook’s ‘desperate’ metaverse push to build features like avatar legs has Wall Street questioning the company’s future, as Business Insider reported. The publication also asked “How many more warning signs does Mark Zuckerberg need to see before he pulls the plug on his metaverse?”
Or does Zuckerberg see something we don’t? And where did all that money go?
Meta released a new metaverse-friendly headset, and the price tag aside, Meta’s New Headset Will Track Your Eyes for Targeted Ads, Gizmodo reported, coming yet one step closer to reading your mind. “Whether you’re resigned to targeted ads or not, this technology takes data collection to a place we’ve never seen. The Quest Pro isn’t just going to inform Meta about what you say you’re interested in, tracking your eyes and face will give the company unprecedented insight about your emotions.”
Don’t Say Gig: California AB5 & How It Will Affect Tech Globally
It looks like California Bill AB5 will be going into effect. To refresh your memory, “Known popularly known as the gig worker bill, it required companies that hire independent contractors to reclassify them as employees,” wrote Investopedia.
Upside: gig workers will now be entitled to minimum wages, health insurance, vacation time and other employee benefits. Downside: they no longer choose their schedules, may be barred from taking other employment. And who ultimately gets the bill for the increased costs? Enactment of the bill was temporarily delayed by trucker protests. “California truckers pledge to continue blockade of Oakland port over controversial labor law,” as it made it difficult for them to work as independent contractors, Fox News reported.
It affects tech, too – big time, so pay attention.
During the lockdowns, some countries required that employers continue to pay their employees, even in cases where the company would essentially need to cease functioning as a result of said lockdowns. If they laid the employees off, they were required to pay three months severance. Both of which drove many companies out of business, especially startups – so everyone was out of a job. Nothing like throwing out the baby with the bathwater.
The Dangers of Founder/C-Suite Myopia
The tech times, they are a-changing. Companies are laying off big time and basically across the board, meaning companies large and small, or are in hiring freeze mode. Google employees weren’t happy when they were told that their travel and swag budgets were being cut. Oh, in case you didn’t see the memo, the days of Tech Entitlement are over, too. The economy isn’t what it was during the halcyon days of tech and, news flash – the tech sector is not immune.
Speaking of behemoths, Amazon Abandons Home Delivery Robot Tests in Latest Cost Cuts, Reuters reported. Called Scout, “The slow-moving devices, accompanied by human minders during tests, were designed to stop at a front door and pop open their lids so a customer could pick up a package. Amazon said the battery-powered robots were part of an effort to reduce greenhouse gas emissions in its delivery operations.”
Amazon is feeling the slower sales, too. Then again, the lockdowns are over, and people can go past their doorsteps once again and shop. With many smaller stores shut down in the lockdown era. Amazon was a go-to, and boom! Hockey stick growth. Now, not so much and they’re cost-cutting too, given their now ‘slow growth.’ Did the company think they’d maintain lockdown-level growth or conditions forever? Even hockey sticks have an end point – something tech and tech investors could seemingly never quite grok.
That Wild, Wild Web: NOT a Tale of Web 3.0
Tech is and has been referred to as the wild, wild west since the early days of Web 1. Like those pioneers who ventures out into terra incognita when the west was being settled, those web pioneers didn’t know what they’d find, and even in their travels, they were making it up as they went along.
Head’s up: the same goes for investors. There’s no startup handbook, although there are books that bear that title. There’s no investor handbook, either. Which is why founders may hear one thing from one investor, get totally different feedback/advice from another. And yet different feedback/advice from a third, and so it may go, all the way down the line.