[KLUG Advocacy] Re: [KLUG Members] "As Tech Bounces Back" -- Linux in the spotlight.

[Robert G. Brown]

On Fri, 31 Oct 2003 07:28:37 -0500, Adam Williams <awilliam@whitemice.org> wrote:

>"The valley is populated with people of various talents, but its essence
>begins with the software and hardware engineers. They create technology
>tools that then find investors and users in the marketplace. It is,
>first and foremost, a high-tech tool shop."
>My question would be "How long till the investor community forgets this
>lesson and returns to their infatuation with well-dressed MBAs?"

There isn't really such a thing as an "investor community", which is 
actually a bunch of people with way more money than they can spend, 
seeking high returns.

If you mean professional investors at institutions, who funnel piles of 
money to front-line VC specialists and bankers (for a living, it's a rough
job, but someone has to do it), my answer is 18-24 months after something 
takes off. The reason is that once things have all worked out well, invest-
ors want someone with a formal business background involved in managing
things, and it takes that long for their pressure, and the growth that 
comes with success and reorganization, to put the "right" people in place.

It seems that it takes about a generation for financial professionals to
repeat serious errors, barring government intervention. The last time 
well-dressed MBA's were considered really important was in the late 70's,
and we can expect that it'll happen again around 2020. Maybe this means 
that the bulk of this decade will be like the 1980's, a rather interesting
(but not nessesarily good) decade, at least in the investment world....

>"But for now, information technology - which represents more than half
>of all business capital investment - will remain the engine."

>Anyone know of a source for this psuedo-statistic?

One place to start is http://www.nasvf.org, and there are dozens of 
VC investment funds, run by people who have these kinds of statistics.
It might be fun to ask a few how right this statistic really is; expect 
some air gaps between the answers.

The figure doesn't really sound terribly wrong, and you might find people
who will back it up quickly, while others will respond with wild laughter.
There are too many local agendas and specialists to have really broad 
perspective, and things are often changing quickly, in any case.

						Regards,
						---> RGB <---