Joe Schoendorf is a partner at Accel Partners, where he has worked for 20 years. His 30-minute presentation this morning at the AlwaysOn Stanford Summit provides some context about the extreme rate of change and how it affects technology businesses.
A lot of the statistics he cites are also presented, with a dramatically ominous musical score, in a video called "Shift Happens."
Joe starts out by saying, "Everybody wants to be like the people in this room." The rest of the world has not yet caught up with Silicon Valley, but they're gaining. "So, as Andy Grove said, stay paranoid."
Accel currently has $2B invested worldwide. Investments include:
Riverbed (RVBD) went public last year, market cap $3.05B now.
PCS (MetroPCS) has been an Accel investment since 1994, now market cap of $12.69B. At one point, investors wrote personal checks for about $5 million fourteen years ago -- and will probably get about half a billion in return -- so persistence pays off.
"If I were to just summarize the 40 years that I've spent here [in Silicon Valley], never has there been a period when the disruption is as big as it is today."
When he came to Silicon Valley in 1966, Intel hadn't yet been founded. Moore's Law drove the advances and growth of the last 40 years. It will continue to be significant, but other trends will have increasing importance. "Moore's Law's not going away ... but what I see happening is fundamental change is increasing at an increasing rate."
"Shift Happens." 20 years ago: IBM was number 1 computer company, DEC number 2. Today: IBM is off the top of the heap, and no one has even heard the word "DEC."
Time in job: 1 in 4 workers has been in current job less than 1 year, 1 of 2 workers less than 5 years. Today's college grad will have 10 to 14 jobs by age 38. "We've changed the nature of what the employer-employee relationship is."
For 1 in 8 marriages that happened in 2006, the couples met online.
The number 1 English-speaking nation in the world is China. China has more honors students than we have students. They graduate a whole Silicon Valley's worth of engineers in a year. "When you keep adding that up, after awhile, shift happens."
For the next 100 years, video will be the dominant way we communicate -- ending a 500-year period when print was dominant. "One seeing is worth a thousand tellings," as the Chinese saying has it.
It took 2 decades to sell the first billion mobile phones,
1,400 days to sell the second billion, and it will take less than 1,000 days to sell the third billion.
Rate of growth in wireless infrastructure in China and Africa is huge. "We live in exponential times."
Half of the world's population is under 25.
Email usage has been going up 15% per year, but has been declining by 15% per year among under-25 segment for the past 3 years. These people are using IM and SMS.
Comment from the chatroom: divergent: interesting, so what's changing isn't less text/more video - it's that text is becoming more ephemeral
In our lifetime, storage and processing speeds have gone through kilo - mega - giga - tera
In our childrens' lifetimes, it will go through peta - exa - zetta - yotta
(I think we should change "yottabyte" to "yodabyte")
Top 10 jobs by 2010 did not exist in 2004
Which means: We have to train students for jobs that don't yet exist, using technologies that have not yet been invented.
Comments from the chatroom:
divergent: learning, discovering, adapting are what we need to be teaching
Calius: focus on knowing how to get the info needed and accurate info at that
maryhodder22: that's not true.. the point is.. get a good liberal arts education from princeton and take math.. then you can apply all that you know about math and analysis and users to your work
Joe poses a question: When should your startup go global?
Two answers -- you've got to figure out your local market first, then go global. Or, maybe you've got to go global before you even get funded.
What worries him? Education
There is not a single currency that you could have bought 50 years ago that has not gone down by at least 50% in that time. Some bankers are starting to think about private currencies as a result.
John Naisbitt, author of "Megatrends," has a new book called "Mindset" that Joe recommends.
Ends with the VC prayer: "Dear lord, one more bull market before I die, please."
Question from the audience: "What's the biggest mistake you've made?"
Answer: Joe was at HP for many years when he was approach by Vinod Khosla. HP had just invented a 32-bit processor, and he said "You're going to take a 16-bit processor from Motorola and some code from Berkeley, and you're going to build *what*?"
