Still No Huge Exits, but Web 2.0 Entrepreneurs Can Use Design to Make Big Money Elsewhere
September 2nd, 2009
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I must say that I thoroughly enjoyed Sarah Lacy’s recent commentary on Clean Tech & Nanotech. Her argument is that big, game-changing ideas might secure massive amounts of funding (and hype), but if they can’t make their solutions relevant to the marketplace they won’t go anywhere. Its a classic VC question of whether a new business is a ‘tech push’ or ‘market pull’.
It was Lacy’s inclusion of web 2.0 in this predicament that got me thinking about where this whole AJAXy, social wave is headed and how we might look back on it in a few years. I could spend a few paragraphs on this so let me save time and cut right to the chase…. Web 2.0 entrepreneurs (depending on how they package their products) aren’t making a ton of money, but that doesn’t mean they can’t get rich.
If there’s one thing that Web 2.0 startups have done exceptionally well, its user experiences & design. Like master chefs in a kitchen, internet entrepreneurs of the last few years have combined the ingredients of Ruby on Rails, AJAX, and jQuery, Photoshop, etc. to create some amazing examples of clean usability, solid information architecture, and stunning design. Consumers have loved them for it, and the business results are clear in terms of user acquisition, retention & engagement. Its just a shame that so many of these companies don’t succeed. But that doesn’t mean their accomplishments are without purpose. It is time that Ruby developers and social-media entrepreneurs realize that the era of applied-experience is upon us. I’m talking about taking on the big enterprise-software players who are coasting along with billions in revenue from sectors such as healthcare, energy, education, government, etc. These industries spend millions of dollars every day on training, data quality, etc. and yet their consumers complain about how little the technology contributes to making their lives easier.
That’s nothing that a little jQuery can’t fix.
The well-honed skills of Web 2.0 can be applied to solve this problem. With a few usability brushstrokes, IA workflows, social-media integration and mobile apps these entrepreneurs can cut corporate IT costs, create a more functional work environment for employees around the world, and make a ton of cash in the process. Look at the companies who are already benefiting from this model… SalesForce and the entire SaaS model that they’ve left in their wake has made Marc Benioff a billionaire. ExpenseBay emerged as the winner at this year’s Twiistup by building a better product to help employees manage their expense reports. Who can forget the tremendous impact that social media & web design had on the 2008 Obama Presidential campaign. And we see how the iPhone is influencing the mobile market by using great design & usability as a barrier to entry.
Sure, you might hear about the social-media startup that has an eight-figure exit and the founders are driving around in Aston Martins. But the founders of enterprise-software companies fly their own jets and race king-sized sailboats across their Mediterranean. Let’s re-focus our priorities and take a piece of this pie.
Large corporations are spending millions of dollars on better, faster ways to increase productivity and cut costs. Web 2.0 designers and engineers have the talent to make immediate impact here and disrupt the dinosaur software players that have reigned for far too long. Let’s do it.
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Tags bill gates enterprise software entreprenuer ilike larry ellison microsoft oracle sara lacy social media web 2.0

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