There are a lot of extremely creative entrepreneurs out there. Too bad the VCs cant find them. My continuous complaint is that most of the VCs that I know and I know a lot of them really dont know much about the technology or technology services they fund.
Dont get me wrong: many of them are terrific financial engineers. But without domain understanding its hard to really understand a technologys promise in the enterprise or with consumers. When the national financial tide was rising it was easy to succeed, but now that times are tough, ignorance has really gotten expensive: too bad for the companies whose valuations have shrunk; too bad for the investors in venture funds managed by financial engineers (not technologists); too bad for the entrepreneurs that mortgaged their futures (without guaranteed management fees).
Technology due diligence should be conducted by technologists, not accountants and not, God forbid, by bankers. But so long as venture investing remains a prep-school/ivy league club, money will be wasted until the tide returns to raise all boats no matter how stupid they look in the water.
I hate all this because we really need smart VCs to find and fund digital innovation, since the government has essentially given up on digital technology innovation (at least during the last eight years). I just wish VCs were better at what they do. 2008 was a horrible year for VCs worse for their management-fee-less investors; 2009 is likely to be worse.
The 2008 presidential campaign horrified and delighted me. It horrified me because many of the presidential candidates from both parties could not spell I n t e r n e t; just as many failed to understand even late in the game that people under the age of 25 get their news from sources other than newspapers and Brian Williams. The same campaign delighted me with how at least one candidate used digital technology to connect to his supporters and donors. He got it and he won.
I was also horrified with the lack of specificity about technology issues and policies with which many of the candidates seemed way too comfortable. I wrote a column about this and got some nasty emails, but the facts were the facts: some candidates talked a lot about digital technology, technology innovation, technology policy and technology funding; other candidates said virtually nothing and in a few cases, absolutely nothing about information technology. Its almost as frustrating as our obsession with avoiding any discussion about physical infrastructure over the past few decades. I guess when a bridge collapses and no ones there, it doesnt really collapse.
I really liked the new technology delivery models that matured in 2008. Software-as-a-service is real: it works well and is cost-effective for the companies that understand how it can be leveraged. Hardware-as-a-service has also taken off. We may well mark 2008 as the year when SaaS and HaaS took off as legitimate technology delivery models.
Other delivery models also (almost) matured in 2008, especially cloud computing. I realize that C2 is far from fully baked, but I love all the attention it got in 2008. Even Larry Ellison failed to derail it.
I like the penetration that Web 2.0 technology made into the enterprise in 2008. While I realize that there will be executives that declare that Web 2.0-technology-is-a-fad-that-will-be-gone-in-two-years, I also appreciate the executives and managers who thought that the pony was worth chasing. They have been and will continue to be rewarded. Wikis, blogs, RSS filters, corporate social networks and even mashups are being deployed to solve a variety of communication, collaboration, customer service, training and other problems on which weve spent a ton of money over the years. Web 2.0 tools are fast and cheap. You have to love the trend.
But the trend I like the most is openness. Our industry continues to invest in integration and interoperability. Even those with the most to lose like Microsoft, Oracle, BEA and SAP have come around to the inevitability of open architectures and alternative software delivery models. We continue to move toward reusability, components for easy software construction, APIs that really interface, and platforms that accelerate interoperability.
Is proprietary software dead? No, and it will never really die but it will get increasingly friendlier in 2009 and beyond. Eventually it will become completely promiscuous.
Finally, I like that the dependency on information technology is growing by leaps and bounds, and that the distance between business and technology is now completely gone. I lived long enough to see the full integration of business and technology. Business strategy and tactics cannot exist without digital technology. In spite of all of the stupid arguments that IT doesnt matter, IT matters more now and differently than it ever did. Nobody moves without us. Were the logistics of business. 2008 proved this once and for all. 2009 and all of the years that will follow will reaffirm just how extensively IT rules.