Reid Hoffman: Common Silicon Valley Missteps

Now in terms of companies in the Valley, I think the primary time where they start going wrong is when they start becoming their own kind of little solar systems and they don't— they're no longer integrated into the pace of activity what's happening in the Valley. And that's not always an executive mistake although frequently, And the key question on technology, because we focus on technology here, is essentially you always have to be investing in the next curve. And so the moment that you don't say I have a really good idea that I'm playing for, it's like, for example, like, well, I've got an idea for optimizing this webpage, that's not a big idea, right? And so you should be thinking to yourself is do we have a big idea in terms of what we're doing? And the big idea has to be a legitimate one. I mean, like one of the things that was— woke me up to competitive differentiation is I asked someone at eWorld, I said, well, we're licensing technology from AOL and we're putting this graphic front end, what's our competitive advantage? And they said, oh, it's the Apple brand. And you're like, no, I mean the Apple brand is great, but that's not a competitive edge in that thing. You have to actually have something that's a great product. And Jobs obviously proved, I think, quite well that there is no business or industry that's truly so far gone that a great product couldn't fix it, but great products are really hard, right? And so as a diction, and so I think that part of what's happened is the companies that you see around the Valley that are kind of large companies that have historically been very well that are now flagging aren't investing well enough into their future. And I think that's one of the key things that they need to do.