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Summary:

The next big opportunity is in social upheavals and revolutions, said Union Square’s Fred Wilson. After the infrastructure of the Internet and the applications have been established, he said the next step is revolutions personified by Wikileaks, BitCoin, the Arab Spring and other changes.

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The next big opportunity after investing in applications is in social upheavals and revolutions, said Union Square Venture’s Fred Wilson today. He said after the infrastructure of the Internet and the applications have been established, the next step is revolutions personified by Wikileaks, BitCoin, the Arab Spring, the hacking attack on PlayStation Network and other changes.

Wilson said in predicting the future, it’s best to look at the past and how innovations evolved. He drew parallels between the next step in the Internet to the dawn of the automobile era, where the cars and roads gave rise to applications such as fast food and the suburbs, which eventually gave way to anti-establishment upheaval.

“If you look at what’s happening next, you see huge societal upheaval, you see basically societal revolutions, [afterward,] you see … Levittowns, McDonalds, strip malls … you had the ’60s sexual revolution, feminism, anti-war establishment. That’s what’s next for the Internet,” Wilson said.

Wilson said it’s unclear how investors can even participate or fund these ideas, but that’s where the Internet is moving now. But it doesn’t necessarily mean funding new companies, Wilson said. “When you look at Twitter, you see that Twitter doesn’t just benefit from (social revolution) but facilitates that. Those ideas that are almost anti-establishment are where you see the biggest opportunities,” he said.

It’s an interesting idea, and supremely ironic to have a discussion on how to capitalize off of a social revolution that may in some ways be a reaction to the inequalities generated by some versions of capitalism. From a practical viewpoint some of the tools of upheaval and revolution are on questionable legal ground. But as Wilson noted, the current stage of frothiness is raising valuations, prompting the venture fund to pass on some current opportunities. He said valuations are up 25 to 50 percent across the board, making it hard to invest in the same way Union Square did in the past.

“We have to move with the market, but there comes a point that the market moves beyond our comfort zone for a particular transaction, and we won’t move on that,” Wilson said.

  1. Isn’t that all a bit paradoxical? I mean the idea behind most social upheaval is to take away power from the corporations and give it to the people. But the internet is run on the infrastructures of companies, not people. So they are basically calling for the destruction of the media that they are relying on.

    But wait you say, the government will take over the internet and give it free to all the people! Do you really believe that? Do you really think the government will give the internet to the people for free? They might for a short time, but do you think it will last? Who will make the routers that power the internet? Who will make to computers? And what will motivate the innovation that has powered the Internet’s growth?

    What other social revolution ever gave anything to the people for free in a lasting and meaningful way? The Bolshevik revolution? The Cuban revolution? The Islamic revolution? Last time I check pretty much every other revolution of the past has used the people to empower the government with the promise of free stuff and a better life and then reneged. The end result was more oppression than before, and more corruption and cronyism for the oligarchy.

    Welcome to the new world order.

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    1. Hey John,

      You bring up some fantastic points. I especially liked how you mentioned that internet providers are in fact corporations. Late last year when Wikileaks was all over the media I had the privilege of participating in a Wikileaks Symposium in NYC. There was a lot of great conversation that day and one of the pillars we all left with was the idea that there has to be a nationless internet provider if we ever want Wikileaks and other such watchdog institutions to have any sort of real credit. The question is, how do we achieve that and who maintains that? Would it even help?

      I’d like to know your thoughts :)

      -Dan

      http://www.whoisdanfonseca.com
      http://www.twitter.com/whoisdanfonseca

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  2. If history has taught us one thing, it is that every revolution is eventually commercialized. The previously disenfranchised that gain economic power become tomorrow’s consumers, the revolutionaries stop espousing vision and start selling product.

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    1. Great point. It’s just a matter of time. Thanks for the comment.

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  3. Social revolution has had a de facto redefinition due to the massive disconnect caused by prevailing culture. I wouldn’t expect anything too big from the people in the comfy industrialized nations. We’re all too stupid from staring at television for decades.

    Real social revolution will occur when people realize society itself is anti-freedom and human rights are a private matter, not to be determined by others. Freedom cannot exist when one derives his rights from another.

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  4. @mindctrl

    “Real social revolution will occur when people realize society itself is anti-freedom and human rights are a private matter, not to be determined by others.”

    Well said.

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  5. I am more concerned about a few big corporations controlling all ACCESS to our lives online and in the clouds.

    How much will this cost us in pursuit of life, liberty and happiness?

    See Elizabeth Walshe’s concerns about trade offs with access– starting with Kindle http://www.csmonitor.com/Commentary/Opinion/2009/0318/p09s01-coop.html

    I like these tools– my argument is not against Kindle, Facebook, Twitter etc… but I don’t think we’ve talked enough about the consequences of life online, and what we are giving up without thinking.

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  6. Interesting call, especially given the extraordinary push for total surveillance that’s going on right now, basically all over the world. Perhaps we’re due for a counter reaction.

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