Silicon Valley’s Meh Middle

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The Silicon Valley myth doesn’t leave much room for companies that are neither raging successes nor spectacular flameouts. But to fully understand the tech industry and ensure that its goals don’t go off the rails, we need to talk more about the companies that are in the meh middle.

You probably know the myth I’m referring to. There are wild stories of companies that started from almost nothing and grew up to become Apple, Facebook or Uber. Then there are the horror stories of start-ups that burned bright and spectacularly flopped like the first iteration of the office rental start-up WeWork and the blood testing company Theranos.

Those polar opposites are the start-ups that people write books and make movies about. The untouchables and the unforgivables are the images that we hold in our minds of technology companies.

But most of life isn’t success or failure, it’s the mushy in-between, and this applies to most start-ups, too. There exists a vast middle ground of overlooked young tech companies that are definitely not winners but are not losers, either.

I’m talking about companies like Dropbox, Box and Cloudera that were once hot enough to be on the covers of business magazines and have survived but hardly set the world on fire. They are not whales nor are they minnows. Dropbox, a digital file-storage service, is worth about as much as Levi Strauss.

Buying their stock didn’t make a bunch of people super rich. Cloudera, which sells software for businesses to wrangle their data, agreed on Tuesday to sell the company for a share price that was far less than what a big investor paid when Cloudera was a relatively young start-up in 2014. Dropbox and Box, also a business software company, are worth roughly the same or below what they were on the days they went public in 2018 (Dropbox) and 2015 (Box). These companies’ technologies either proved to be not super relevant or they were supplanted by something better.

There are lots of start-ups that took off during the post-financial crisis tech boom, earned oohs from techies and got tons of money thrown at them, had initial public offerings and then … eh. They’re fine. Others were sold or quietly disappeared.

(One caveat: I would have put Square in the meh middle until the past year or so, when its technology, including digital storefronts for small businesses, proved vital during the coronavirus pandemic. That shows that companies can sometimes quickly shift from meh to great, or from meh to dead.)

The problem is that people in and around technology are happy to blare about companies, THIS IS GOING TO BE HUGE, and then hardly mention them when they don’t become stars.

Ignoring the meh middle should matter to all of us for two reasons. First, it is a missed opportunity to understand what went right and what went wrong. I joked on Twitter that there should be a Midas List for meh, referring to the annual Forbes rankings of the most successful start-up investors. And why not? People and companies who didn’t live up to the hype might have lessons for us.

And second, excluding the middle distorts the picture of Silicon Valley and reflects a harmful tendency to consider anything short of a world-changing idea barely worth noticing. This creates a perverse incentive to overhype anything new and overlook start-up ideas that might result in worthy but unspectacular companies.

I wish that just OK received more attention. Shooting for the moon in Silicon Valley can lead to Google and Facebook. It can also lead to WeWork and Theranos. I don’t want meh to be the goal, but I also wish that the in-between weren’t so invisible.