I just finished watching videos of several companies pitching at TechCrunch Disrupt and reading the overviews of the rest, and Mark Suster’s post about whether startups today are solving real problems. You know what the problem with most of the companies at Disrupt is? It’s not just that they seem trivial or transient. It’s that the internet just isn’t that cool anymore and these guys don’t know it.
I don’t mean that the internet isn’t important. I was already wrong about that in 1991. It’s that the internet is so unbelievably important that every single person who wants to accomplish anything consequential knows they have to figure out how they can use the technologies, behaviors, data and models developed online to do it. It’s not cool to have an online strategy–it’s conventional wisdom.
Thanks to Web 2.0, it’s also not very hard or expensive to start an online company. That was true five years ago and at this point the gee-whiz of being able to hack together in a weekend something inconceivable at 100x the price 10 years ago is a yawn.
All this means that if you’re starting a company now you don’t get credit just because you’re a web-based business or for cleverly using what’s now off-the-shelf open source tools to hack together something. The cool kids who were early (and right, and hard working) have grown up into powerful businesses and the professionals are moving to fill in the easy white space. The table stakes now are not cool features, but a product that solves real problems and a business model that gets paid for doing so.
That’s the disconnect I saw for so many of the companies competing at Disrupt. Most of the pitches sounded like they were either “me too” interations (track your spending, but mobile), addressed trivial problems (“let’s plan to meet, maybe, when I show up”) or looked like a consultant’s view of a problem (“you know what’s huge? subgroups. With social.).
I don’t mean to disparage other entrepreneurs. It’s hard to start a business and I root for everybody to make it. But the world has moved on past most of these companies and they don’t even know it. TechCrunch doesn’t know it, either: they cover the idea of these startups–the simple premise–breathlessly and uncritically whether it makes sense or not. However, some of the panel judges definitely know that the world has moved on from cool ideas to real businesses, which is why the presenters looked like deer in the headlights when asked about things like market size and fit (“who buys this and why”) sales and marketing (“how to you get people to buy it”), and competition (“why won’t they buy from someone else”).
Just as in life, in business the definition of cool changes as industries grow and evolve. Rehashing the Web 2.0 fashions of the past few years is not just uncool, it’s naive.