Making fun of Silicon Valley is easy, but the next big thing always looks like a toy

It’s become popular to make fun not just of the “bros” who run a lot of startups — the ones that Businessweek magazine chose to parody on the cover of its latest issue — but of the whole idea of having technology startups in the first place, since so many come up with useless things like Yo, an app that exists solely to send the single word “Yo” to other users. But Y Combinator head Sam Altman argues that out of silliness and irrelevance, sometimes great things are made — and anyone who has followed even the recent history of technology would have a hard time disagreeing.

I confess that I’ve had my own share of fun ridiculing the idea behind Yo, as well as some recent startups such as ReservationHop, which was designed to corner the market in restaurant reservations by mass-booking them under assumed names and then selling them to the highest bidder. But what Altman said in a blog post he wrote in response to the Businessweek story still rings true:

“People often accuse people in Silicon Valley of working on things that don’t matter. Often they’re right. But many very important things start out looking as if they don’t matter, and so it’s a very bad mistake to dismiss everything that looks trivial…. Facebook, Twitter, Reddit, the Internet itself, the iPhone, and on and on and on — most people dismissed these things as incremental or trivial when they first came out.”

Sometimes toys grow up into services

I’ve made the same point before about Twitter, and how it seemed so inconsequential when it first appeared on the scene that I and many others (including our founder Om) ridiculed it as a massive waste of time. What possible purpose could there be in sending 140-character messages to people? It made no sense. After I got finished making fun of Yo, that’s the first thing that occurred to me: I totally failed to see any potential in Twitter — and not just when it launched, but for at least a year after that. Who am I to judge what is worthy?

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Chris Dixon, an entrepreneur who is now a partner at Andreessen Horowitz, pointed out in a blog post in 2010 that “the next big thing always starts out looking like a toy,” which is a kind of one-sentence paraphrase of disruption guru Clay Christensen’s theory from The Innovator’s Dilemma. Everything from Japanese cars to cheap disk drives started out looking like something no one in their right mind would take seriously — which is why it was so hard for their competitors to see them coming even when it should have been obvious.

Even the phone looked like a toy

Altman pulled his list of toy-turned-big-deal examples from the fairly recent past, presumably because he knew they would resonate with more people (and perhaps because he is under 30). But there are plenty of others, including the telephone — which many believed was an irritating plaything with little or no business application, a view the telegraph industry was happy to promote — and the television, both of which were seen primarily as entertainment devices rather than things that would ultimately transform the world. As Dixon noted:

“Disruptive technologies are dismissed as toys because when they are first launched they ‘undershoot’ user needs. The first telephone could only carry voices a mile or two. The leading telco of the time, Western Union, passed on acquiring the phone because they didn’t see how it could possibly be useful to businesses and railroads – their primary customers. What they failed to anticipate was how rapidly telephone technology and infrastructure would improve.”

Is Yo going to be listed in that kind of pantheon of global success stories? I’m going to go out on a limb and say probably not. But most people thought Mark Zuckerberg’s idea of a site where university students could post photos and personal details about themselves was a waste of time too, and Facebook recently passed IBM in market capitalization with a value of $190 billion and more than a billion users worldwide. Not bad for a toy.

Post and thumbnail images courtesy of Thinkstock / Yaruta and Shutterstock / Anthony Corella