Monday, July 23, 2007

Some reaction to Sunday's column

Sunday's Innovation Economy column was headlined, 'Will Boston ever catch up?' It begins:

    The explosion of consumer-oriented technologies, from YouTube to the iPhone, has been pushing the pistons of the technology economy for the past three years. That's great for California, and a real problem for Massachusetts, which has specialized in building technologies for corporate use since the mini-computer boom of the 1980s.

    "The legacy here is more enterprise-focused, all the way back to Wang and Digital and Prime and Apollo," says venture capitalist Todd Dagres, referring to a crop of computer makers long dead and buried. "That was where you wanted to be in the last millennium. It's just not where the real juice is right now."

    The juice, as Dagres puts it, is in all kinds of tech products for consumers, from new handheld devices and television set-top boxes to online videogames and so-called "social networking" tools like MySpace, Facebook, and Twitter, which allow people to connect and communicate with friends using free software.

    ...Having just boomeranged back to Cambridge after spending two years in San Francisco, the lack of consumer tech activity here is startling to me -- it's like going from a noisy, hot, crowded bar to another across the street where the bartender has plenty of time to wash glasses and gab with the three regulars perched on stools.

The folks at TripAdvisor e-mailed to note that they've had phenomenal consumer success with their Needham-based travel portal. I wrote about them in 2000 when they were just getting started and then again in 2004, when they were sold to Barry Diller's IAC. After raising just $4.5 milllion in VC money, the sale price was $200 million. Not bad. A spokesman says their profit margin is better than 50 percent, and that they're hiring like mad.

Matt Westover of Newton Peripherals e-mailed:

    Having been in technology for 20 + years and spending over 12 years on the West Coast, I think there are significant opportunities in the East. The mentality of the local VC’s are different in my opinion from the West Coast VC’s and can have corresponding positive/negative effect on the young companies. We have stayed away from accepting any venture capital to date.

Nabeel Hyatt, quoted in the piece, thinks I'm being overly dire.

And Antonio Rodriguez, a serial entrepreneur who recently sold the consumer-oriented Tabblo to HP, posted this response to the piece on his blog.

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