Does social media have a lifespan?

In a blog post entitled “Why Facebook is Killing Silicon Valley” Steve Blank (www.steveblank.com) last week lamented that, as a result of the enormous amount of quick money VCs had made from social media startups in the past few years, VCs are turning their backs on investments into traditional science and technology in order to focus purely on social media.  The economics are fairly straightforward – social media startups require little in the way of upfront capital expenditure, have an enormous potential market and are (almost) infinitely scalable.

Blank however points to waves of innovation that have taken place within Silicon Valley (see graphic below) over the past century which he suggests demonstrates an ability to reinvent itself, stating “as the Social Media wave runs its course a new wave of innovation will follow”.  So, does social media have a lifespan? 

Source: www.steveblank.com

I would argue however that social media is fundamentally different to previously waves of innovation in Silicon Valley - it goes straight to the heart of how ordinary people (and like the readers of this blog - extraordinary people) interact and engage with each other.  While Facebook has generally dominated the space in the western world for the past 3-5 years, inroads made by more recent entrants such as Path and Pinterest clearly demonstrate that there is still space left in the sandpit in which other kids to play.  It's easy to be distracted by the onslaught of negative publicity created by a poorly executed IPO, but I would suggest that there is a long way to go in the development of social media.  


The question then is whether social media investment and traditional science and technology investment can co-exist?  That will be up to the VC community to determine in the longer-term, but for the time being I’m betting my money that social media is here to stay.