Michael Arrington’s latest article reminded me why he, and his TechCrunch, have succeeded. Sure he’s wildly outspoken and controversial at times. But that’s his personality and how could someone run a blog and not be? Who would read it?
In this post he talks about the state, in a certain respect, of Silicon Valley. Specifically in regards to talent.
“There are many things that keep Silicon Valley disruptive. The most important thing is fresh blood – new people with lots of energy, new ideas and absolutely no concept of the ‘way things are done.’ The kind of person who sees a wall and thinks ‘Do I climb over it or do I tear it down,’ but never thinks ‘Oh, I can’t go past, someone tell me what to do next.’”
As I was reading the article, I couldn’t help but think of another hotbed… Brazil, and how similar and different it is all at the same time.
What’s the same? The energy and the raw ideas. The money and investment going into these entrepreneurs. Deals are happening every week. The biggest and most respected VCs are all spending time here and clambering to be a part of it.
There’s also a lot that is different. There isn’t a culture of entrepreneurship here. Talent doesn’t expect equity, for instance, and in a lot of cases doesn’t want it. That affects salaries. Without equity people expect to be paid what thy made at their last job plus some.
There is no pattern for startups here. It almost feels like we’re the first class of a brand new type of university. A university in which the only professor is your passion and your classmates are individuals who just might have more questions than you have.
Brazil is young, but on the cusp of maturity. There were early players that threw their hat in the ring in the 90s and paid for it. It then took 10, 12, 15 years for internet penetration to get to a point where these businesses could actually be hugecompanies doing thousands and thousands of orders a day. Only recently has internet penetration reached a point where the cost of innovation has reached levels where seed investments are all that is required to launch and gain traction. The big companies that launched in Web 1.0 and have held their ground here in Brazil are now ripe for disruption. One of these companies, a conglomerate of some of the biggest online players, was recently voted the most hated company by consumers, despite their huge volumes. If entrepreneurs weren’t rallied before, they are now. Consumers in Brazil are fed up and are looking for companies who can solve the difficult problems associated with pubescent development. Problems with infrastructure, technology costs, and a young and sparse talent pool.
In the US, mobile is a natural next step for entrepreneurs, startups, and innovators with smartphone penetration skyrocketing to, by some estimates, 27% of all cell phone users. Brazil’s smartphone usage is still in the low single digits and the percentages vary greatly from report to report. The problems being tackled by entrepreneurs in Brazil are the same problems that were tackled in the US in the 90’s and the early 00’s.
But that is what makes Brazil such a fascinating place and the next great hotbed of innovation. Imagine having all the markets up for grabs like in 1996, but with the technology and resources and examples of 2011. Imagine the possibilities if someone like Jeff Bezos was given an opportunity like that. What would happen?
I work in an office that houses entrepreneurs like Jeff Bezos. There are four different startups in our little 120 meter office, and roughly 20 employees. All of them tackling vastly different problems, but with a united feeling that something bigger is happening than all of us fully understand. We are laying the ground work for the disruption and innovation that will happen over the next 5-8 years. These are the people that the next generation of entrepreneurs will emulate, and quote. These are the future panelists of technology forums, the founding fathers of Brazil’s technology sector. The rebels that changed everything.
Brazil is different. But it’s roots are the same as the Valley’s. And Arrington is right.
“Everything is just getting started. We are still at the beginning. We’re in for the ride of our lives.”