Try, Try Again: Tech Boom 2.0

I am proud to say that none of the students who studied with me in the late 1990s fell into the get-rich-quick scheme that was known as the dot.com craze. My students knew that my view of true entrepreneurship was that it was not just a mechanism to feed off of greed and raise a bunch of money that had no real purpose just because you could.
True entrepreneurship is about addressing real needs, building value, creating jobs, fueling the economy, building strong communities, and creating real wealth for those who take on the risk of investment. I told my students that they could start a dot.com if they like, but if they wanted my support (and a reasonable grade) they had to start one that met those criteria. None ever did. At the time I took some heat from many of my fellow academicians, but I stuck to my guns on this one and I think that time proved me right.
Om Malik, who has had his work in a variety of business publications including Forbes, writes a piece in Business 2.0 titled “The New Road to Riches:
How to get ahead in the postbubble world: Build a company cheap. Flip It fast. Repeat.”
When I first read this title, the words of Pres. Reagan came to mind, “Here we go again!” But read on. The techies finally are beginning to understand true entrepreneurship in Version 2.0 of information technology start-ups.
“(It) is part of an emerging breed of here-today, bought-tomorrow startups that are sprouting with minimal funding, flowering briefly, and being gobbled up by far bigger companies. In many instances, these built-to-flip outfits forgo — or sometimes can’t get — money from venture capitalists. They instead create shoestring operations focused on the rapid development of narrow technologies to plug gaps in existing product lines or add useful features to existing products. Then they look to a deep-pocketed patron to scoop them up.”
Instead of raising money just because they can, these folks are now looking for real opportunities, bootstrapping them, and finding a way to help them grow. While I am a little concerned about the “flipping” part, at least they are getting the first steps right this time.
How big is this trend? “By the end of September, there will have been more than 5,300 tech acquisitions in 2004, based on research from Mergerstat.”
My hope is that those who get bought up and then are locked into employment deals with big tech companies will begin to become restless with the corporate life. Maybe Version 3.0 of the tech boom will actually see entrepreneurs who actually want to build companies that have legs and will build value over the long term. Then we may really see a Renaissance of technology companies fueling sustainable economic growth. True techie entrepreneurs: what a concept!