Title: 2002 Very Different From 1975
1(No Transcript)
22002 Very Different From 1975
Out
In
- 10-100 Million Venture
- Fund Investments.
- 1 Million Venture
- Fund Investment.
- Atlanta, Austin,
- Phoenix.
- Institutional Entrepreneur.
3What Happened?
- ERISA (1975).
- Exponential Growth of Equity Markets.
- Gov./Corp. RD Passed By Private Equity.
- Apple, IBM PC, Lotus/Visicalc (1981).
- The Start of Automated Desktops.
- Microsoft, Oracle (MSFTNASDAQ. Public in
1986). - The Start of Mass Customization.
- The Fall of the Wall (1989).
- Changing Geopolitical Borders.
- The Internet (AOL(1989), Yahoo (1994)).
- Changing Economics of Markets, Geography and
Remote Locations.
4ERISA Revolutionized Equity Markets
5US Venture Capital Disbursements FY1980-2000
Private Equity Grew with Public Equity
(000s)
Source US Venture Capital Association FY2000
Yearbook.
6Cal. Northeast Disburse 2/3s of Total s
Source US Venture Capital Association FY2000
Yearbook.
7In Absolute Terms, The Numbers are Staggering
VT 1
7
7
Source US Venture Capital Association FY2000
Yearbook.
8 Technology Infrastructure Revolutionized
Business
Scale
- Automation, Digitization.
- Size/Weight of Products.
- Reduction in Labor.
- Reduction in Required
- Capital to Achieve Scale.
- Reach, Cost, Quality.
- Consumer Economics.
- Supplier Economics.
Infrastructure
9Automation,Miniaturization,Digitization Change
in Scale
- Lower Investment for Scale
- - Less Capital Employed.
- - Less Labor Required..
- Lowers Avg. Product Weight.
- - Lower Transportation Cost.
- - Lower Locational Advantage.
High
s per Assets
Low
s per Employee
Low
High
Low
High
Avg. Product Weight per
10 Less Labor,Lower Weights,Lower Distribution Costs
GDP- per Lb.
Gross US Domestic Product
GDP- per Person
Weight of GDP
11Mature Infrastructure Change in Consumer
Economics
- Consumer Access Changes.
- Consumer Economics Change.
- Activities for Consumer.
- Fulfillment Change.
- Supplier Scale Changes.
High
Reach
Low
Speed/ Quality
Low
High
Low
High
Cost
12New Infrastructure/Technology Has Happened Before
- Combination of Technology/Infrastructure Has
- Historically Redefined Boundaries/Scale.
- Major Incidents in Last 100 Years.
- - Infrastructure Railroads, Highways, Power
Lines, - Telephone Lines, Broadcast Towers, Airports,
- Internet.
- - Technology Steam Engines, Gas Engines,
- Electricity, Electronics, Airplanes,
Computers. - Each Incident Changed Access and Economics.
- Old Industries Reshaped to New Assumptions.
- New Industries were Created.
13 New Infrastructure/Technology New Businesses
New Businesses
- Digital Information, Transactions.
- Global Exchange.
- Intercity Trade.
- Suburbs. Regional Cities, Malls,
- Motels, Remote Labor.
- International Business, FEDEX,
- Destination Resorts, New Corporate Centers.
- Home Power, Night Sports.
- Professional Sports, News,
- Movies.
-
- Computers
- Steam Engines
-
- Cars,Trucks
-
- Airplanes
-
- Electricity
- Audio,Pictorial
- Reproduction
14Each Class is Better Qualified Than Last
Opportunity
- Each Graduating Class Technically
- More Qualified than Previous Class.
- Markets will Adapt to New Consumer.
- New Consumers Know Infrastructure.
- Economics will be less Concentrated.
Challenge
- College Grads in Shanghai, New Delhi,
- Tokyo have Similar Opportunities.
- Less Labor, Weight, Capital but
- Greater Scope.
- Costs Down but What About Relative
- Revenue.
- Infrastructure/Technology Still in
- Disequilibrium.
15Recommendations
- Experience More Important Than Ever.
- Entrepreneurial Environments.
- Institutional Environments.
- Get Comfortable with Change.
- Local things are going Global?
- Global things are going Local?
- Things above the ground are going underground?
- Things below the ground are going above the
ground?