A new option - recreational entrepreneurship

They are everywhere - in dorm rooms, coffee houses, family rooms, basements, and even corporate cubicles. They enjoy regular meals and have a pleasant place to sleep, courtesy of a paying job or loving parents. But they read Techcrunch and dream of financial independence. Have laptop, can code.

They are the recreational entrepreneurs, and they are all participating in the web/mobile app lottery.

Recreational? Lottery?  

Let's examine this phenomenon more closely. The cost of entry is low. The range of payoff is broad, from nothing to millions. Hundreds of thousands, perhaps millions, of people are playing. That really does sound like a lottery, doesn't it?  And most of the players are not being paid for the time they spend camped in front of the computers with which they have a passionate relationship.That sounds like recreation.

Hobby farmers have no delusions about making any money, except perhaps on the appreciation of their land.  It's a way to re-connect with the earth.  Beach-combers with metal detectors don't really expect to turn up any pirate treasures.  It's a pleasant way to stay "in the moment." But part-time app developers tend to harbor the strong belief that their brain-child will be the next multi-million dollar acquisition announced by Google. They are inventing something of presumed value, in anticipation of a significant financial payoff. In that sense, they are definitely behaving in an entrepreneurial manner.

Before the 21st century and the internet, the closest thing we had to this form of behavior was exhibited by writers, poets, and graphic artists, all passionate, most toiling at some other profession in order to eat regularly while they waited to be discovered and published. But even when they did "make it," the payoff was relatively modest by comparison to those we see today. The "reach" was simply insufficient to generate millions of dollars in value; and they all knew it. They were working for their own satisfaction, not with dreams of financial independence.

My, how times have changed.

 

 

Comments

[Jim Flowers]

Jason,

You're right. There really are several different phenomena at work, I think. The recreational app builder boom is one thing. The movable workplace for IT professionals is another. And the economic skewing of salaries and real estate prices in Silicon Valley (as compared to many other very nice places) is yet another. Lumping them can confuse any discussion.

Thanks for your thoughts!

[Jason Thrasher]

Jim, your post strikes me as a good interpretation of the obvious - a kind of reality check of the times. I think you're right, there are boatloads of people doing this. The thought that app developers are the "modern writers" of our times is frightening, especially if you're involved in it yourself.

However I disagree that this is representative of the current 2011 Silicon Valley (or 2010-present). I definitely disagree with the first commenter, that unemployment is high in the Valley (or that it's representative of tech-sector unemployment).

I'm a hiring manager and am constantly competing for candidates that are local to fill openings on my team. These candidates aren't casual folks in coffee shops writing apps, these are recent grads, all the way up to seasoned engineers who may be at any size company, and have many choices of who to work for. The competition is pushing salaries through the roof again, as it did in 1999-2000. For example, the average person with a B.S. in a tech field from Stanford or MIT is getting offers around $90k/yr - even when they have little industry experience. The economy for tech-talent in Silicon Valley is very healthy right now.

There's been a culture shift over the past 10 years though. Most recently Facebook has changed workplace culture by making the "cafe workplace" a mainstream accepted practice. It isn't to say that they are all working on "apps", but the process for working has changed such that people exhibit the same behavior that you're alluding to.

[Jim Flowers]

Mark,

It appears that we agree. thanks for the thoughtful comment.

Jim

[BrophyWorld]

There are other reasons to avoid envy of Silicon Valley, too. The official reported unemployment rate in Silicon Valley is 11%, 4 points higher than their technology competitors in Austin, Texas.

The glory days of Silicon Valley have passed. Silicon Valley enjoyed explosive growth in the 1950-1985 period, much greater than Texas, but population growth has decreased to the overall United States growth rate, and now Silicon Valley starts businesses that export wealth and jobs to other states and countries.

Intel, whose founder Robert Noyce invented the semiconductor integrated circuit at the same time as Jack Kilby of Texas Instruments, is a Silicon Valley microcosm that creates engineering wealth in Oregon and manufacturing jobs in enormous fabrication plants outside California, including many in Israel, and is the largest private employer in Oregon, New Mexico, and Ireland. Few work for Intel in Silicon Valley.

I wrote more about Valley envy on my blog:
http://brophyworld.com/why-does-start-up-chile-want-to-mimic-silicon-valley/