Reading is fun. But not every book is really worth reading it – especially when it comes to business books. Therefore I already started the “Book of the Week” Series, where I share comprehensive abstracts on my favourite books.
Now I want to start another series called: “Business Books” – featuring information on books in a more compact way. Today I would like to present you “Once You’re Lucky, Twice You’re Good”, Sarah Lacy (2008).
In Once You’re Lucky, Twice You’re Good, Sarah Lacy explores the rebirth of Silicon Valley after the 1990’s Internet bubble burst. She explains the origins of Web 2.0, describes the founding of new high tech companies, and shows how the economics of Web companies have changed between the 1990s and today. Readers discover the importance of community in the Web 2.0 world, as well as different categories of Web 2.0 offerings ranging from platforms to applications and widgets.
The term Web 2.0 was christened by Tim O’Reilly of O’Reilly Media. It refers to the business opportunity offered by social media sites. Lacy describes how PayPal produced many of the entrepreneurs who founded the early Web 2.0 companies. In the Web 2.0 world, PayPal alums seemed to have the Midas touch. The author proposes that this group’s success is cultural, going back to their deep belief in the Net. Web entrepreneurs can be categorized into four generations. The earlier generations greatly influenced the Web 2.0 generation. While angel investors are not new, people from the older Web generations were trustworthy friends of the younger group. Lacy refers to them as “friendtors”. In the early 2000’s, as entrepreneurs started to build new sites, friend-tors wrote checks to keep the experiments going. Venture capitalists were shut out of the early stages of Web 2.0 companies when they would normally build up the most lucrative ownership stakes.
Web 2.0’s reliance on community may be a greater contrast with the first wave of Internet companies, than the dramatically different economics of Web 1.0 and Web 2.0. The two greatest influences on Web 2.0’s community atmosphere were open source software and peer-to-peer file sharing. While Silicon Valley bubbles come and go, Lacy believes there will be lasting effects from the Web 2.0 generation. As with every Silicon Valley cycle, those who will make the most money from Web 2.0 will be the ones who believed in the power of the Net before it was fashionable again.