by Tony Long
The hype is pouring in fast. Almost every major media outlet with an interest in digital culture and business has been breathlessly covering the release of a new social sharing app called “Color,” a type of crowd-sourced memory-collage tool where smartphone pictures and video you shoot of a given event are combined with those of others in proximity, whether you know them or not. Everyone shares, there’s no permissioning, no “friending,” no linking, just the mash-up of motion and stills of the same occasion from the perspectives of different people.
Pretty cool. But the app isn’t the real story.
The real story is that Color, the company behind the app, was able to obtain $41 million in financing before their product was released. In an environment where business optimism is on the rise but business lending remains tight at best this would be remarkable enough. That they received financing from dot-com veterans Bain Capital Ventures, Sequoia Capital and Silicon Valley Bank raises the question: Isn’t this the same blind faith that drove the last Internet bubble? Add in the skyrocketing valuations of companies like Facebook, Groupon and LinkedIn and it certainly seems like we’re headed for another implosion, right?
Won’t Get Fooled Again
In a word, wrong. We are in a new period for both the Internet and those who create businesses with it. During the previous dot-com boom, start-up companies allowed the marketplace to speculate rampantly on potential commercial gains from mass adoption of untried technologies. It was a sort of business photosynthesis, where the promise of the value of a community of users was converted into early-stage investment and, in many infamous instances, IPO stampedes. As in nature there were a few winners and many losers.
Even though many of that crop of start-ups expired quickly when exposed to the elements, and the business world decried the shallowness of those companies’ roots, the soil that nurtured the founders’ ideas remains as fertile as ever. No matter the environment, when technology affords us new ways of doing something, there will always be someone with the vision for how that something should be done. Innovation thrives regardless of its financial surroundings.
The Internet’s historical problem (if we dare combine “historical” and “Internet”) has always been location; beyond the slow data speeds, awkward interfaces and uncertain purpose of content, to use the Internet one had to be stationary, with a cord or two plugged into a wall. Even with today’s sleek new netbooks, computers with keyboards are not meant for walking.
We’re past that limitation now. Because smartphones encourage more seamless use of the Internet, new ventures like Color and others are better able to realize their full potential for collecting and capitalizing on communities. During the previous dot-com bubble the Internet was something people could use; with smartphones today the Internet is something we do use. As John Battelle puts it, today’s Internet is not the old PC-based experience, but rather “the digital platform through which we leverage our lives.”
What interactive technologies have been doing most cleverly of late is reinventing time-honored social mores, and making a broad reach – almost broadcasting – available to all. Facebook has made a new social paradigm out of sharing images and messages in a series of concentric circles, in the process elevating the power of simple words such as “share,” “like,” and “friend.” Writing and recording music electronically is fun, but employing the same distribution method that Lady Gaga used – MySpace – plusses the experience. Like having a former lottery winner pick your numbers for you, your chances of winning the lottery are no greater but there is an extra thrill in the exercise.
Given all that is happening in the marketplace today the release of the film “The Social Network” seems to have been spectacularly well timed. Regardless of the exact provenance of an idea, all the best innovations come from those who can synthesize a vision for how what we all do can be done better. The question for investors and the public becomes, can that vision’s full potential be realized?
Those who are betting $41 million on Color think the answer is, “Yes it can.”
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