an interesting trend is occuring relative to the term "intellectual capital" that BS's message reminds me of. I've read recent issues of Forbes and "fast company" that talk about the concept of "intellectual capital", the former ridiculing it and the later glorifying it. what is intellectual capital? in short, in the information age, value becomes more and more abstract. you don't measure value any more in a company by the number of heads, like cattle, but in fact the volume of those heads. "intellectual capital"-- one person may be worth ten times another based on their contribution to the profitability of a company. increasingly we are going to see business models that reflect this truism, much to the dismay of "atom-based" companies that will fight this trend tooth and nail, and die out like dinosaurs kicking and screaming. we will see people make money that relates far more to their actual contribution to a company. if programmers are adding the most value, then their salaries will reflect it. in a way, their salaries already reflect it! part of my posting the "microstock market" is that I hope that this trend continues to the point that it may be possible some day to have a stock market of ideas-- a far more conceptual construction in which value is related to the people participating and their ideas, not the amount of atoms/mass that is involved. I suspect such a thing will eventually happen. I think in the future we will also see ways of growing companies from the very most seed-like idea to the mass manufacturing system. there will be some kind of cohesion and elegance about the whole thing, as the process is recognized as basic as growing plants. a neat book I would recommend to anyone is called "accidental empires" by an infoworld columnist on the computer industry that hints on some of these ideas. on to BS..

Really interesting post! I think the net will simplify the ownership issues and the publicity issues long before it makes good information about the value of small companies easy to get. That's far more dependent on the personalities of the players in a company (hard to judge, except in person), the ideas the company's trying to develop into products/services (may need non-disclosure arrangements,

intellectual capital. imagine everyone's resumes being posted on their web site. it may be hard to judge, but the information is there for you if you have some kind of measure. such systems already exist today for some companies. you see everyone's resume online. also, in companies in which people have individual web pages describing internal company projects, I suspect increasingly these pages will be open to the outside world so customers can better judge the value of a company. [ideas] may need privacy to

develop in, may not want to waste their time publicizing each step in their decision processes, contract negotiations are usually very private, etc.)

the question to ask is about "open standards" in the computer industry. ultimately I think this is a concept that will become far more global than merely electronics and software but begin to permeate the entire economic system. notice that it is possible for companies to survive, even thrive, on open standards. everyone benefits. it's not a "us vs. them" thing any more, a paradigm shift that requires some people to rethink their approaches and attitudes. (bill gates would be one example of this. he has found in the past that he made enemies out of companies that were not really his enemy. see the "accidental empire" book). however I do agree there is a role for secrecy even in this system. however openness/publicity will tend to be the new norm, instead of closed-up boxes as it is now.

On the other hand, the net can often help those parts of a business. The Cygnus Support folks have done well in a very open environment. I recently talked with a headhunter who'd seen my discussion with someone on Usenet and wanted an opinion about the guy; the headhunter was doing a lot of in-depth web searching to find people who might be interested or qualified for a position he was trying to fill.

yes, what I see in the computer industry is that increasingly because the intellectual capital is so valuable, you are going to see situations in which valuable players become like "free agents". they move around teams, they have people who do nothing but figure out where to plug them into, and their salaries are very high. this is happening right now in the computer industry. the concept of working at one company or another is increasingly less relevant. I've not seen many good books or articles on this amazing phenomenon, and hope that some people might be able to cite some.

Venture capital firms provide some value to their investors by managing the granularity of the transactions, but they also add value by providing personal understanding of the companies they're evaluating whether to invest in.

I agree. venture capital firms are on the leading edge of understanding the importance of "intellectual capital" and what it adds to a company. although I've heard horror stories of VC firms that just throw a lot of money around without the slightest clue about the technology involved. I suspect the converse is true that there are some very sophisticated technology-only VC firms that go over the technology they are funding with a fine-toothed comb. the image of VC is that it is very chaotic and hit or miss but I wonder if some VC firms are becoming far more scientific than throwing darts ... Information wants to be free,

or is at least cheap to copy, but providing the personal attention needed to understand and analyze information and make good decisions on it is still expensive.

intellectual capital is what transforms mere information into profit. there is a proportion going on here that might be exponential (profit is exponentially related to intellectual capital?) unfortunately while I believe IC exists, it is very hard to measure. it's like an intelligence test. everyone agrees that "intelligence exists", but no one has found a foolproof way to measure it. oh well, the market will support those who come the closest to the optimum. The nets can improve the

information they have available on both the company and the market, and can provide better information to investors about what venture capital analysts are good at evaluating what kinds of businesses.

tremendously. in fact I think our future economy is going to become extremely web-based. customers and companies will all use the web to interface with each other. companies without web pages will be considered extremely gauche.

Will the nets split these businesses up into individual venture-advice-consultants competing for investors? Or will the lead to broader coordination between venture capital businesses? Or both?

there is a neat idea in "accidental empires" that involves the idea of a software studio, which I think is a great idea. in short, the idea is to make software creation like moviemaking. you begin from the start in assuming that you may or may not have a hit. you hire contract workers who get a piece of the final action. the contract workers move onto new projects all the time. I think this could be a very powerful model, which is already being used in the production of computer games. p.s. thanks for taking me seriously BS <g>