When asked this question, the search radar in Silicon Star's brain seemed to linger for a long time, and finally slowly squeezed out several "old companies": "Airbnb? Uber? Zoom? ……"
Known as the source of global innovation, since the 1960s, it seems that a number of innovative companies have been born every ten years: Microsoft, Intel and Apple in the 1970s and 1980s, Google, Amazon and Yahoo in the 1990s, Facebook and Tesla in the early 20th century, Airbnb and Uber around 20 10.
Now, the pointer of time has come to 202 1. According to the innovation law of Silicon Valley, some brand-new and subversive companies should have appeared in our field of vision. However, when we talk about innovation in Silicon Valley, it still seems that we can only focus on those companies that were born ten or even twenty years ago. The most popular newspapers are giants such as Apple, Microsoft, Facebook (now Meta) and Amazon. Some new companies and models, such as Clubhouse, are always short-lived, and it is difficult for them to enter the world-class innovation stage.
So, who pressed the pause button of Silicon Valley innovation, and what hindered the pace of the birth of new giants in Silicon Valley? This time, we tried to find the answer behind it.
Looking back on Silicon Valley five or six years ago, on the one hand, start-ups flourished, on the other hand, large companies attacked the city and expanded slightly. A number of companies such as Uber, Airbnb and Pinterest are in full swing, and explosive financing news comes one after another: Pinterest's five-year valuation exceeds11600 million, Airbnb's five-year valuation exceeds 25 billion, Uber's five-year single-round financing exceeds 60 billion, and Laifu's six-month two-round total is nearly 2 billion, and its three-year valuation exceeds 5 billion.
Everyone is busy running around the conference venues of various companies and roadshows of various incubators, and even squatting in front of a company for a night, for fear of accidentally missing the stars of tomorrow or some big news.
However, just after that boom, the entrepreneurial atmosphere in Silicon Valley seems to have begun to cool down. According to the statistics of Pitchbook, during the two years from 20 15 to 20 17, the amount of seed financing in Silicon Valley decreased by about 40%, and the average number of quarterly financing transactions decreased from 20 1500 to 900 in 20 17, and this downward trend has continued to this day. Although the overall venture capital scale in the United States will still hit a new high in 2020, the proportion of Silicon Valley will be greatly reduced, and it may even be reduced to less than 20% in 202 1 year.
In other words, money began to flow from Silicon Valley to other parts of the United States.
This downward trend in the field of entrepreneurship can also be seen from the changes in the number of startups in Silicon Valley.
According to the statistics of new start-ups on the silicon valley indicator website, since 2000, the whole silicon valley region has ushered in a period of entrepreneurial prosperity of about 15 years, and the number of new start-ups is rising every year, reaching a peak around 20 12-20 15 years. After that, the number of startups began to drop sharply, and it continues to this day. In the last two years, the number of new startups has returned to the level of 2000.
Take an inventory of Silicon Valley companies that have developed rapidly and have a considerable scale in recent years. From * * * bicycles to take-away food delivery, from mobile payment to short video live broadcast, they all absorb models from outside Silicon Valley, such as China, and then carry out localization transformation and replication. In the global unicorn list updated by Crunchbase in real time, as of 202 1 and1,among the top 20 companies in the list, only four companies are headquartered in Silicon Valley, namely Stripe, Instacart, Databricks and Chime, three are located in other cities in the United States, and the rest 13 are from China.
And if we look back at 20 15, there are 6 companies with 10 before the unicorn list. Who are these six names? Uber, Airbnb, Palantir, Snapchat, Pinterest, Dropbox. Their innovative models have had a profound impact on the world in the following years: countries all over the world set off an upsurge of imitating Uber and Airbnb, burn after reading swept young people, and Pinterest's waterfall life sharing opened up a new social battlefield. ...
In recent years, few start-ups can replicate the explosive financing and valuation growth paths such as Uber and Airbnb, and the expansion of big companies' burning money is becoming more and more gradual, even traceable. From 2000 to 20 15, it experienced the vigorous and high-spirited era of 15, and now Silicon Valley seems to be moving from a youthful youth to a middle age-more stable, but less passionate. We can't help but ask, why is the innovation vitality of Silicon Valley reduced?
Nowadays, when we talk about technology and innovation, it must be those technology giants who have the right to speak technology.
In the past two decades, head technology companies represented by Apple, Amazon, Google, Facebook and Microsoft have acquired hundreds of small and medium-sized startups in Silicon Valley and the whole United States. They all follow a similar pattern-first, acquire companies in the original business to consolidate their dominant position, and then increase their reach and make acquisitions in new areas to increase their income sources and outflank competitors.
Recently, Washington post made a comprehensive statistics on the acquisition history of Apple, Google, Amazon and Facebook, showing us the oppressive expansion of the giants in the field of science and technology in the past two decades.
Since the first acquisition of 1988, Apple has completed 27 acquisitions in the main business line of consumer hardware and 96 acquisitions in other business areas. These include the acquisition of Siri to develop it into a voice assistant, the acquisition of Beats to expand Apple Music and then compete with Spotify, and the acquisition of health monitoring company Gliimpse to lay out health business.
Since the first acquisition of 1998, Amazon has completed 40 acquisitions in the field of books and e-commerce, and 7 1 acquisition in other business areas. Including the acquisition of Peritor, ClusterK and other cloud computing companies from 20 12 to start the company's second business growth pole, the acquisition of Whole Foods' offline retail industry of $21370 million from 20 18, and the continuous acquisition of Internet of Things potential enterprises such as Echo, Blink and Eero from 20 18 to make a big push into smart homes.
In the last two years, Amazon has also extended its reach to media and games (acquisition of MGM, umbra 3D and Wondery), health (acquisition of health navigator) and autonomous driving (acquisition of Zoox), and its business covers almost all aspects of people's lives.
Google's acquisition history is even bigger. So far, Google has made 865,438+0 acquisitions in its original search, map and advertising business, and 65,438+087 acquisitions in other fields. After consolidating the dominance of search engines, every gorgeous transformation of Google seems to be related to acquisition.
For example, in order to compete with Microsoft in the field of office tools, Google acquired Writerly and Tonic Systems, transformed them into Google Docs and Google Slides, and gradually built Google's online office ecosystem. In order to seize the market in the field of video advertising, Google acquired YouTube at a high price of $654.38+0.6 billion in 2007. In order to protect its hardware products, 20 1 1 acquired Motorola Mobility at a high price of 123 billion US dollars. Later, it laid out frontier fields such as artificial intelligence, cloud computing health and autonomous driving, and acquired a large number of well-known unicorns including Deepmind, Fitbit and North.
Facebook, the social giant, may not be as good as a few big names in terms of the number of acquisitions alone, but it has many big moves. First, in 20 1 1 year, it bought Instagram with only 1 3 employees, and then in 20 13 year, it bought WhatsApp for1600 million dollars, thus building a troika of the social kingdom and becoming the king of global social interaction.
Since then, Facebook has extended its reach to the fields of hardware and virtual reality, acquired Oculus for $2 billion, and began to acquire a large number of small and medium-sized companies related to the concept of metauniverse. Last month, Facebook officially changed its name to Meta, completely transforming the meta-universe, trying to take the lead in seizing market share in the virtual era.
Looking back at the acquisition history of these giants, most of them have acquired small and medium-sized start-ups with patents or great growth potential, including many "stars of tomorrow" on the unicorn list. Few startups can resist the temptation of rejection under the attractive acquisition amount thrown by technology giants.
Even if some companies bravely refuse, they can't escape the pressure of being surrounded by giants. For example, Snapchat once rejected Facebook's $3 billion acquisition proposal, but Facebook quickly launched a burn after reading function that imitated Snapchat, and also launched a Stories model that almost copied Snap on Instagram, which caused a long-term serious blow to Snap's business development.
In addition, the huge scale of technology giants has given them unparalleled ability to resist risks, and they have poached a large number of talents by virtue of their "earning ability". According to statistics, during the COVID-19 epidemic, a large number of small and medium-sized enterprises in Silicon Valley closed down, but the benefits of large technology companies rose instead of falling. The top 15 technology companies with the largest volume have revenues of10.35 trillion US dollars in 2020, ranking 15 in the global GDP. Of the 665,438+09,000 technology jobs in Silicon Valley and San Francisco, 38% are employed by the 65,438+05 largest technology companies.
In recent years, American regulators have also noticed and taken action against the practice of technology giants building barriers and hindering innovation by virtue of their advantages, and curbing the monopoly behavior of technology giants has become the consensus of the two parties in the United States.
Since 20 19, the US Congress and the Department of Justice have started anti-monopoly investigations on technology giants. From June 20438 to October 2020 10, the Judiciary Committee of the U.S. House of Representatives released a 450-page investigation report on digital market competition, which showed the obstacles of technology giants to healthy competition and technological innovation in the industry through multiple evidences. In June this year, the US House of Representatives announced five bills in draft form. If they are finally passed, it will be difficult for future technology giants to acquire and may face business split.
However, despite being at the forefront of anti-monopoly, the acquisition pace of the giants has not slowed down at all. Since the beginning of this year, the number of start-ups acquired by technology companies with a value of less than $654.38 billion has once again set a record, an increase of about 40% over the same period in 2000. Investigators from the US Federal Trade Commission said that the continuous acquisition of large technology companies is a "Pac-Man Strategy". Individually, each acquisition seems to have little impact, but the collective effect of hundreds of smaller acquisitions will lead to monopoly by giants.
Giants continue to extend their tentacles upstream and downstream, create ecology and erect high walls, leaving less and less space for entrepreneurs.
The other side of the monopoly of technology giants is the decrease of entrepreneurs in Silicon Valley. The only way to innovate is to make people. The occurrence of any innovation mode is, in the final analysis, the innovation of human thinking. However, in Silicon Valley, which has become the richest region in the world, the innovation power is gradually lost with the growth of wealth.
"Garage culture" was once considered as the epitome of Silicon Valley spirit. Generation after generation of top technology companies such as Hewlett-Packard, Apple, Microsoft, Google, Amazon, etc. were born from the garage and went to the world. Today, the HP garage located on Anderson Avenue in Palo Alto is officially certified as the "birthplace of Silicon Valley", attracting thousands of entrepreneurs and technology practitioners to make a pilgrimage here.
"Garage culture" represents entrepreneurs' creativity, innovation and fighting spirit driven by strong endogenous motivation because of their curiosity and desire for the unknown world in that era when there is no money, resources and employees. For example, Bill Park Jung Su and Dave Packard developed and assembled HP's first electronic oscillator for only $538, and Jobs made the first Apple computer with $65,438+$0,300.
In today's Silicon Valley, the average median annual salary of employees in technology companies has exceeded $654.38+200,000, and the company's welfare benefits are enough for people to live a carefree life. On the one hand, it is easy to get wealth and a comfortable life, and on the other hand, it is a business field full of uncertainty and narrow escape. If it were you, what would you choose?
Difficulties and hardships, Yucheng. Entrepreneurs who want to start a business in Silicon Valley today obviously need more courage and courage than in the past. We should not only dare to refuse the temptation of high salary, but also strive to find living space under the territory of giants. The era of poor and white garages is gone forever, replaced by surging capital competition.
In addition, the rising start-up costs in Silicon Valley have also discouraged many entrepreneurs. In the past two decades, the prosperity of science and technology in Silicon Valley has spawned huge wealth, but at the same time it has quickly made Silicon Valley one of the "most expensive" regions in the world. Last month, the joint venture company just completed a survey on the talent attraction of Silicon Valley. Among them, 7 1% of the respondents think that the quality of life in Silicon Valley is worse now than it was five years ago, and 56% said they would consider leaving Silicon Valley in the next few years. The high cost of living has become the main driving factor.
For entrepreneurs, employees' salary, venue rent and operating costs have become unavoidable issues in starting a business in Silicon Valley. If you want to do garage business, you have to have money to buy a garage first, right? But now, the median house price in Silicon Valley has reached $654.38 +0.4 million, which is obviously an astronomical figure for young entrepreneurs who have just graduated and have the most entrepreneurial ideas.
Even giants such as Apple, Amazon and Microsoft. In the case of soaring operating costs in Silicon Valley, these companies have focused on new offices and recruitment in lower-cost areas in recent years.
Today's entrepreneurs all want to survive in the entrepreneurial field of Silicon Valley. In addition to an excellent entrepreneurial idea, funds and contacts have become the most important weapons. In the past, it was difficult to copy the road to success by killing a bloody road on your own, and you had to rush between roadshows and investors, which made entrepreneurship a lot more complicated.
As can be seen from the above, in recent years, the entrepreneurial ecology of Silicon Valley has undergone great changes, both in the technical environment and the entrepreneurs themselves. Even so, it is undeniable that Silicon Valley is still the world's science and technology center, with the largest number of technology companies, the top venture capital institutions and the best talents.
Every era has its heroes, and the change of science and technology also needs the precipitation of time. In recent years, Silicon Valley is not without excellent startups, but many of them have turned from the well-known consumer side to the invisible enterprise side, and many of them are laid out in advance in cutting-edge technologies such as 5G, artificial intelligence, virtual reality and blockchain, waiting for the arrival of technological singularity.
With the gradual standardization of the market competition environment, we also expect to see the emergence of the next Silicon Valley superstar soon.
Reference link:
1./technology/interactive/2021/Amazon-Apple -Facebook- Google-Acquisition/
2. The full text of the investigation report on digital market competition: markets.pdf Digital Celebration.
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