I interviewed Chris Maresca who discussed Bridging the Gap Between Silicon Valley Technology and Business in the Real World.
Can you first provide a brief background of yourself?
Sure. My name is Chris Maresca. I'm the chief operating officer of Project Inertia. We build project management systems for very large construction projects. We currently have seven projects that we're working with, all of which are more than a billion dollars in size. I have been in technology and in Silicon Valley for almost 20 years now. This is actually my 9th startup. I've had four successful exits, including one IPO. And in a previous life, I started an import-export company in Europe and started my first business when I was a teenager. I'm half American, half French. I actually grew up most of my childhood in Europe, but I finally wound up in Silicon Valley. I've been here ever since, and it's been a wild ride.
Can you talk about what's happening in the Industry, the Technology Industry in Silicon Valley?
Sure. It's interesting. We've... I've, at this point, been through two technology revolutions. The first one was the internet in the '90s and the advent of global interconnectivity. And that was fascinating and exciting. And we all know what happened in early 2000 when the whole thing blew up as a giant bubble.
In the last few years, we've had some [inaudible 00:01:45] with mobile and social networks and the, sort of, the democratization of internet tools. And it's been really, really fascinating. I think it's very interesting. The other side of this equation is that technology, the falling prices of technology, enables vastly more automation across the rest of the commercial businesses and industry. And that's been really, really interesting.
In the last year or so, there's been somewhat of a slowdown in funding for startups in Silicon Valley. It's gotten harder than it used to be to get funding, especially with mobile consumer applications. The focus has shifted now in the last, I would say, 18 months from mobile consumer sort of enterprise business applications and evaluations of consumer-centric companies have followed that trend as well.
On the other hand, we just had the SnapChat IPO, which has given everybody a boost, and now everybody wants to invest in the next SnapChat, probably an unrealistic goal, but still very interesting.
So there's a gap between the technology in Silicon Valley and the real world business. Can you talk about how this gap can be bridged?
Silicon Valley exists in its own universe. And if you live around theis area, you get very, very used to very advanced technology that appears in your life extremely quickly. In the last few years, people have discovered things like Uber and Airbnb, but those things have existed here for more than five years, and people here are just used to that and used to having all this technology available to them. And that has an impact in the way people think. You exist in this very tech-centric, hyper-connected universe, but when you go somewhere else — whether it's somewhere just outside of Silicon Valley like Las Vegas, or someplace further like Chicago, or someplace even further like Singapore or Cape Town, South Africa — you find that that connectivity and that expectation of technology consumption that you have in Silicon Valley just doesn't exist.And that applies not only to consumers, but also to businesses.
And Silicon Valley is somewhat blind to this fact, and it has a tendency to create technologies that are irrelevant for much of the world or are so extremely disruptive that they cause a lot of social dislocation in very unexpected ways.
One example is Uber, classic example. There are some places where taxi drivers' incomes are down 60-some odd percent. And that doesn't really help society at large, but this is an unintended consequence of Silicon Valley's technology-centric view.
You could also look at things like Amazon disrupting traditional supply chains and also traditional businesses in a tremendous fashion. And I think there's other areas where this is going to happen — 3D printing, for example, is going to have an enormous impact on manufacturing, especially because it will allow companies to move their manufacturing much closer to their customers. UPS here in Silicon Valley, it'salerady talked about putting 3D printers on their delivery trucks so that instead of delivering something that was shipped from far away, it would be printed in the truck outside of a customer's door, almost literally.
All of that has tremendous implications, not just on businesses but I think also on the fabrics of various societies where manufacturing is a very big component of the workforce. And these are things that people here are thinking about and are pushing to implement without, sort of, regard to what the impact might be in any way whatsoever. Whether that’sgood or bad is really largely a political question. But it is a reality.
And a lot of the stuff that is created here is just completely irrelevant to most people in the world.
Do you have any experiences or stories you can share from your life and your work that you've done?
Absolutely. I think that there's... I think that you have a wide variety... I remember I worked for a very large, very well-known company here in Silicon Valley that had created a pile of new technology but because of the way their business was structured, they were valued, the company was valued as an e-commerce, physical-goods retailer. They had created a bunch of interesting technology, and they thought that if they released it out to the world, then everybody would look at them as a software company instead of a retailer of stuff, and that that would push up their valuation tremendously.Of course, that isn’t really how the world works, but this is how people in Silicon Valley [inaudible 00:08:00]. Needless to say, this didn't actually work.
And we've seen other businesses that have tried to transition, for example, from hardware or software, and that has been a disastrous transition for quite a lot of those. Silicon Valley has a saying, which is that software is eating the world because Silicon Valley is not really about silicon anymore. It's mostly about software.
To a certain extent, quite a lot of hardware now is expressed as software rather than having to be designed as specific hardware. So you get a very interesting inflection of all of these different trendsnd then people trying to harness them, especially people in older industries that are getting disrupted.That is often not a very good recipe for a future for a company.
On the other hand, you have some very big Silicon Valley giants, brand names that people believe are world leaders who have internally accepted that they are no longer in leadership positions in terms of innovation because they are now mature companies, and they are madly trying to buy their way into new areas. That's the other side of the equation here.
So it's very interesting living here. We have a tremendous amount of startups. I think 4,000 was the last number I heard. And most of them will die an early death because they are working in market that are not relevant. I think when I was a consultant, we worked on, I want to say, probably well over 100 different startups. I would say out of those, maybe 20 or 30 are still around. Some of them have been bought, but most of them are just market failures in various ways. And that's just a reality. That's the risk component of working in the startup ecosystem.
Well, thank you for sharing today, Chris, on bridging the gap between Silicon Valley technology and business in the real world.
You're very welcome. Any time.
About Chris Maresca
Founder, COO/CTO & Board Member