A lot of things are sort of funny right now with respect to technology entrepreneurship. One of those things is apparently called SoMoLo (or SoLoMo or MoSoLo, depending on who you talk to.)
I was talking with a VC friend of mine who brought up the idea of SoMoLo. Oddly, I hadn’t heard of it and asked what it was. He explained it was the convergence between social, mobile and local and that it’s all the rage right now for Silicon Valley startups. Everyone wants to jump on the bandwagon.
(The legendary) John Doerr, of the high tech venture capital firm Kleiner Perkins, is credited with coining the term, SoLoMo, which seems to be the most widely adopted version in use today. But I’ve even seen references to MoSoLo, like this one by Lisa Barone over at Outspoken Media (although the piece is actually titled The SoLoMo Revolution: Social Media, Local Search & Mobile Search Collide). This Tumblr post from blogospiel even refers to it as ‘Human Pixeling’: the idea that people today are addressable wherever they are.
I’ve always made fun of startups that all want to do the same thing. (Not just because I’m trying to be mean, but because I’m trying to raise awareness and help people, I swear!) Anyway, this do-the-same-thing phenomenon may be no more evident than it is today here in Silicon Valley with SoLoMo. It’s not that I don’t agree that the three converging trends are interesting, but…
What people don’t realize about the utility tools like mobile apps that make it easy for you to find deals, your friends, etc., is that by and large, they don’t often produce great businesses. Why? Because they are winner-take-all markets. You either make it big or you go nowhere. Few startups in these markets are doing really well. People think they can get a base hit or a double, but the reality is they’re either going to hit a home run or strike out.
Either you’re Twitter or you’re nobody, as far as I’m concerned.
It all goes back to what I said in The Irrationality of Entrepreneurship. With SoLoMo, you have a very high probably of wasting 2 or 3 years of your life coding/designing your butt off for something that will never gain (enough) market traction.
I think more young people are starting companies around the world than ever before. I have no problem with that; in fact, I love it! I was 14 when I started my first company. But here’s the problem: I think most successful entrepreneurs are uniquely positioned to tackle whatever problem they take on.
Just because you’re a 20-year old kid who knows how to use your mobile phone to check-in somewhere doesn’t make you unique. It means you are just like everyone else. Perhaps worst-of-all, you probably have the power-user bias. You’ll pitch something like a ‘geo-enabled meta-checkin game layer that incentivizes users by allowing them to unlock daily deals when their friends are in a 300 meter radius from them. It’ll be huge!”
My answer: O rly?
You can’t just pile on because there are so many other college kids starting companies now and they all expect to succeed. You have to bring something unique to the table. You need to go after something that is special to you and you’re background. Something uniquely your own.
Investors: Just because a space is hot doesn’t mean you’re going to pick a winner. And taking money and throwing it at a bunch of startups in the SoLoMo space just so you can ‘have a horse in the race’ isn’t the answer either. Just because you buy 10 lottery tickets doesn’t mean you’ll win. You increase your odds a bit, but it’s still a long shot! What you are really doing is just wasting more money.
I know SoLoMo is hot. I know it’s a big trend. If I could invest in an index fund of the space, I probably would. But I realize that most individual contenders in the space are losers, and I’m not crazy enough to invest in one. You shouldn’t be, either. The reality is, most companies in that space are not going to win. They’re not hot and never will be. Which brings me back to the original equation:
SoLoMo is hot. True. But isn’t it just another example of Extraordinary Popular Delusions and the Madness of Crowds? Which, by the way, was written in three parts:
Ring a bell? Still want to go out, jump on the bandwagon and waste several years of your life?
If you do, then I’ll be here ROFLMAO.