I’ve been asked countless times if it is worth to still enter the startup hype – or will it be gone sooner or later. Yes, in the developed nations, where legal structures, capital markets and production gets ever more complicated, it may fade away. If the is is good or bad is a very important question to ask.

 

When The Startup Hype ends

Startups exists for approximately 12,000 years. The 300,000 years before that people have been already innovative, but not as a full time job. But 12,000 years ago, when during the agricultural revolution individuals produced more food than they and their family could eat – everything changed. That was the time when some people ventured out to specialize and did no longer gather or hunt but built pots, bend metal, built housing and others began t sell those products and services as a full time job. The simply traded products and even services for food. Those were the first entrepreneurs. And that never faded away. After hunting and farming, building and trading have been the oldest businesses on earth.

Today, roughly 0.007% of the world population are entrepreneurs. In the developed world, about 0.03% are entrepreneurs, approximately 3% are busy farming and taking care of food and 97% are working for those entrepreneurs or for the government. As most governments have the tendency to grow, the number of startups and innovations are sinking. In the developed world, South Korea, Japan, Germany, Switzerland and the US are some of the most efficient with less than 15% working for the Government.

The more people work in “safe” jobs in large enterprises and the government, the lower the number of startups and with it the lower the likelihood to grow the next generation of innovation powerhouses. That’s when the startup hype ends in those nations and grows in other nations as the windows for new opportunity widen quickly.

And we could see this over the past 12,000 years. Egypt led the longest time as global economic leader. But it was not sustainable. Other leading nations rose. The Roman empire, the chinese high times, the british empire, and so forth. Today – the economic power is far more distributed. California, China, Germany, South Korea, Switzerland are all leading nations. But when the startup “hype” vanishes away, so do their countries on the global leader list — BUT — with 20-30 years of a delay.

What are your prediction, when the startup hype will end?

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