Om Malik had a great post about how venture capitalists are so hung up on quick return and scale from startups that they would never fund some of the greatest innovations we now take for granted. I also made the point that it isn't just the VC's, but people who do start new businesses are more interested in the funding events and potential pay-outs than they are in building something enduring and important, regardless of scale. It's my chief complaint about technology and Silicon Valley.
I'm not a hater. If I had some not-that-brilliant idea like Tumblr that I could have executed on for a billion-dollar buyout, I'd certainly be OK with that. It seems to me though that no one is that interested in investing in the smaller thing that could be awesome, occupying a particular niche. I was catching up on my Fast Company subscription when I read an article about Kevin Rose, who correctly states that there are many "lifestyle businesses" that could clear a couple hundred grand a year, but no one invests in those.
There is a certain danger in all of this, as I see it. Technology, especially involving the Internet, has driven a portion of our economy when other areas have struggled or entirely gone away. There are big bets that had huge payoffs in the last decade and a half, like Google and Facebook, but I worry that not enough people are interested in the long tail of smaller plays. Do you know how thrilled I would be to have a quarter-million in revenue every year?
These smaller, niche businesses also have another benefit that the big bet chasing doesn't have, in that they're likely to endure a lot longer. My own business is more hobby than lifestyle business, but since forming my LLC, more than $300k has changed hands that may not have otherwise. (Don't be impressed by that figure... the profit margin has not been very high!) I never had visions of being the next Google, but I didn't end up like Pets.com either.
My hope is that more people pull their heads out of the bay area and think a little smaller, a lot longer term. To me, it's all of those smaller things that last that will add lasting value to the economy and to our culture.