The November issue of Boston magazine has an article “How MIT Became the Most Important University in the World” by Chris Vogel. It talks about how MIT students are better dressed these days, more articulate, and more out-going. In fact, they’re actually hip, as witness this fellow who “plays water polo and has tattoos”.
What they’re really excelling at, though, is starting companies, far more than Harvard graduates. Harvard has recently opened something called the Innovation Lab in its business school, which aims to get Harvard students to be as entrepreneurial as their geeky counterparts down-river. The article describes all the ways MIT encourages this, from the Innovation Prizes, to networking and mentoring, to student clubs, to various Entrepreneurship Centers. It claims that MIT grads started 5800 companies between 2000 and 2006, nicely stopping the statistics before the Great Recession. Somehow all this churn is the Wave of the Future.
Well, we’ve seen this movie before. The New Economy in the ’90s was going to revolutionize all business, with its novel ideas about young people working for free, sorry, for stock, on technologies that no oldster could understand. There were a few good ideas that came out of all that – mail-order books and movies with good ways to preview them, a way of directing advertising towards people who were interested in a product, and a way of sending out music without Mob distributors taking a cut – but there were thousands that weren’t good and cost a several hundred billion in mis-allocated investments.
Now a similar story is playing out, even though the great success of Web 2.0, Facebook, is already clearly crooked. The same dreams are dangled in front of young inventors: fame, riches, independence, quick success. The people doing the dangling, venture capitalists, are desperate for anything new, since they have to justify their own salaries to their superiors. As do tech reporters!
The traditional sources of jobs for the creative young, like academia and corporate R&D, are in dire straits these days. They can’t make the grand claims that the VCs can, have little money, and prefer to hire desperate foreign students and H-1Bs anyway.
So what does it say about the state of innovation these days that the hucksters are skimming off the best and brightest? After all, most startups fail. They often fail morally too, with their founders having to lie for money and having to fire their friends. Is this what young people have to look forward to in their careers? They should be spending their best years solving important problems, not raising money.