Palo Alto these days definitely has the aura of a gold rush.
After the slowdown of the past few years, there is a noticeable uptick in the economy and of course the buzz around Facebook and the social gold rush hitting Silicon Valley. Coffee shops and restaurants are packed; people are out shopping and socializing with a vengeance. Why? In the wake of the massive success of Facebook, there is a wave of capital hitting Palo Alto invested in social software companies and services. Young, hoodie-wearing, Tom’s shoe sporting, unshaven geniuses from all over the globe want to create the next Facebook or be the next Zuckerberg.
So they come to Palo Alto just like the gold miners of 1849 did coming to San Francisco to strike it rich. And as in the gold rush era, there will be plenty of entrepreneurs like a young tailor named Levi Strauss who make a fortune inventing new things like blue jeans to help the gold miners.
Every week, there is a new startup taking a storefront formerly occupied by a yogurt shop or a comfortable shoe store. Real Estate on University Avenue in Palo Alto is now in the top five most expensive areas in the United States. Is it a gold rush? Yes. Is it a bubble? Certainly. But, I would argue, there will be several more significant software companies beyond Facebook that make a significant impact on social computing before the bubble bursts.
One company has popped on the scene in recent weeks with a rapid ascent into the top ten most popular social sites is Pinterest. With a whispy, graphical UI, Pinterest has captured the imagination of users who like to window shop on the web enabling users to “pin” images they admire. Pinterest boards can be easily created and shared with your social network. Imagine a bride planning her wedding and sharing photos with the wedding planner and her bridesmaids. Take a decorative portfolio from a designer and share it with an architect or builder. Simple, yet powerful-and socially viral. The leader of the e-commerce team at the world’s largest retailer recently told me his company is getting more traffic from Pinterest shares than Facebook. More traffic from Pinterest than Facebook-wow.
While Pinterest seems like a rather simple, yet creative feature it illustrates the fact that there will be significant innovations appearing almost out of nowhere from the massive capital infusion going into social software companies in Palo Alto.
So, if you are with an established company with powerful brands why do you care?
You should care because your audience of customers and prospective customers is now on a diverse set of rapidly proliferating social platforms and you are patting yourself on the back as a social media guru because you have a Facebook fan page. Let me share a little secret-its not enough.
The reality is your audience is surfing Facebook like people surf TV-its just one channel of the rapidly emerging social network universe. Back when I was a kid, we had three, count ‘em three TV channels. They were the only games in town and the three major networks had outsized power over viewers, brands and advertisers. Over time, shrewd new entrants discovered that users wanted more choices and more diverse content. The same thing is beginning to happen in social media, with more content, more entrants and new ideas and benefits for customers.
We here at thismoment believe in building a social content management platform for global brands that includes Facebook, but goes beyond it to include YouTube, Twitter, G+, LinkedIn and now Pinterest. We believe our brand customers are best served by having a flexible platform that is extensible to new social media outlets such as Pinterest. When the next new social media superstar like Pinterest emerges, thismoment will be ready and deliver the capability to our customers.
So, the gold rush is on in Palo Alto. Get ready for some surprising new players to knock your socks off.
- John Bara
SVP and CMO
