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Tech startups: A Cambrian moment | The Economist
Jan 18th 2014

the world of startups today offers a preview of how large swathes of the economy will be organised tomorrow. The prevailing model will be platforms with small, innovative firms operating on top of them. This pattern is already emerging in such sectors as banking, telecommunications, electricity and even government. As Archimedes, the leading scientist of classical antiquity, once said: “Give me a place to stand on, and I will move the Earth.”....yet another dotcom bubble that is bound to pop. Indeed, the number of pure software startups may have peaked already.... warns Mr Andreessen, who as co-founder of Netscape saw the bubble from close by: “When things popped last time it took ten years to reset the psychology.” And even without another internet bust, more than 90% of startups will crash and burn.

But this time is also different, in an important way.

the basic building blocks for digital services and products—the “technologies of startup production”,...Some of these building blocks are snippets of code that can be copied free from the internet, along with easy-to-learn programming frameworks (such as Ruby on Rails). Others are services for finding developers (eLance, oDesk), sharing code (GitHub) and testing usability (UserTesting.com). Yet others are “application programming interfaces” (APIs), digital plugs that are multiplying rapidly....Startups are best thought of as experiments on top of such platforms, testing what can be automated in business and other walks of life. Some will work out, many will not. Hal Varian, Google’s chief economist, calls this “combinatorial innovation”. In a way, these startups are doing what humans have always done: apply known techniques to new problems. The late Claude Lévi-Strauss, a French anthropologist, described the process as bricolage (tinkering)..... software (which is at the heart of these startups) is eating away at the structures established in the analogue age....this special report will explain how start-ups operate, how they are nurtured in accelerators and other such organisations, how they are financed and how they collaborate with others. It is a story of technological change creating a set of new institutions which governments around the world are increasingly supporting.
anthropologists  Archimedes  bubbles  Cambrian_explosion  dotcom  entrepreneurship  Greek  Hal_Varian  innovation  innovation_policies  Marc_Andreessen  millennials  platforms  software_is_eating_the_world  start_ups  taxonomy  technological_change  urban 
february 2014 by jerryking
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