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The Silicon Valley Apocalypse!

The Silicon Valley Apocalypse!
by Daniel Nenni on 12-30-2015 at 12:00 pm

 Based on the Behavioral Sink Experiments in the 1950s it is hard for me to believe that Silicon Valley will continue with the unicorn fueled hyper expansion we are currently experiencing without some very serious repercussions, both social and financial. First let’s talk about the social issues which to me are the most interesting.

The Behavioral Sink Experiments found that populations of social animals (mice and rats) in space and resource limited environments would explode then implode into extinction as a result of social decay. The hypothesis was that nature has its limits in how social animals can thrive/survive:

Among the males the behavior disturbances ranged from sexual deviation to cannibalism and from frenetic overactivity to a pathological withdrawal from which individuals would emerge to eat, drink and move about only when other members of the community were asleep.

After being part of the Silicon Valley rat race for 30+ years I have never seen anything like the crowds we have today. We are over building and over populating way beyond what our environment can handle. The roads are the clearest sign. Back in the day you could miss traffic by leaving before 7am and coming home before 5pm. Now you have to leave before 5am and start your trip home before 3pm otherwise a 40 mile commute turns into an 80 to 120 minute stress test. Leaving at 10am and returning home at 7pm no longer works either. Traffic is now a way of life and with gas prices at record lows it is only going to get worse. Traffic accidents, which are now an everyday thing, also increase social decay.

And is there anybody in Silicon Valley that is working a 40 hour week? No, we are working even more hours per week for the same or less pay then we used to, absolutely. So you have to ask yourself, “how is this all going to end socially?”

Financially speaking we have seen two meltdowns in the past two decades: The Dot Com Bubble and the Subprime Mortgage Crisis. The only remotely positive result socially is that the divorce rate actually went down during these two periods. Partly because couples could not afford two separate households but I digress…

Clearly we did not take those two financial life lessons to heart since we are probably approaching yet another financial meltdown that can be called “The Unicorn Walking Dead” or maybe “The New Age of Unicorpses”.

Those at the top tier of the billion-dollar funding club, companies such as Airbnb Inc. and Uber Technologies Inc., will survive relatively unscathed, said Max Wolff, chief economist at Manhattan Venture Partners, but he expects a “meaningful correction” to ripple through the club. Some of today’s unicorns will keep being fancy pets and some of them will be meat, Wolff said.

By the way, out of the 130+ unicorns not one of them are ACTUAL semiconductor companies, even though without semiconductor innovation none of those unicorns would exist. Something for the unicorn breeding VCs to think about wouldn’t you say?

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