The Next American Frontier

[R.A. Hettinga]

<http://online.wsj.com/article_print/SB121115437321202233.html>

The Wall Street Journal

May 19, 2008

OPINION

The Next American Frontier
By MICHAEL S. MALONE
May 19, 2008; Page A15

The entire world seems to be heading toward points of inflection. The
developing world is embarking on the digital age. The developed world
is entering the Internet era. And the United States, once again at the
vanguard, is on the verge of becoming the world's first
Entrepreneurial Nation.

At the Chicago World's Fair in 1893, Frederick Jackson Turner
delivered a paper to the American Historical Association  the most
famous ever by an American historian. In "The Significance of the
Frontier in American History," he noted that, according to the most
recent U.S. census, so much of the nation had been settled that there
was no longer an identifiable western migration. The very notion of a
"frontier" was obsolete.

For three centuries the frontier had defined us, tantalized us with
the perpetual chance to "light out for the territories" and start our
lives over. It was the foundation of those very American notions of
"federalism" and "rugged individualism." But Americans had crossed an
invisible line in history, entering a new world with a new set of rules.

What Turner couldn't guess was that the unexplored prairie would
become the uninvented new product, the unexploited new market and the
untried new business plan.

The great new American frontiers proved to be those of business,
science and technology. In the course of the 20th century, Americans
invented more milestone technologies and inventions, created more
wealth and leisure time, and reorganized their institutions more times
than any country had ever done before  despite a massive economic
depression and two world wars. It all reached a crescendo in the
magical year of 1969, with the creation of the Internet, the invention
of the microprocessor and, most of all, a man walking on the moon.
Along with genetic engineering, we are still busily spinning out the
implications of these marvels. Yet it is becoming increasingly
apparent that the cultural underpinnings of these activities have
changed in some fundamental way.

We still have schools, but a growing number of our children are
studying at home or attending private schools  and those in public
schools are doing ever more amounts of their class work on the Internet.

We still have companies and corporations, but now they are
virtualized, with online work teams handing off assignments to each
other 24/7 around the world. Men and women go to work, but the office
is increasingly likely to be in the den. In 2005, an Intel survey of
its employees found that nearly 20% of its professionals had never met
their boss face-to-face. Half of them never expected to. Last summer,
when the Media X institute at Stanford extended that survey to IBM,
Sun, HP, Microsoft and Cisco, the percentages turned out to be even
greater.

Newspapers are dying, networks are dying, and if teenage boys playing
GTA 4 and World of Warcraft have any say about it, so is television.
More than 200 million people now belong to just two social networks:
MySpace and Facebook. And there are more than 80 million videos on
YouTube, all put there by the same individual initiative.

The most compelling statistic of all? Half of all new college
graduates now believe that self-employment is more secure than a full-
time job. Today, 80% of the colleges and universities in the U.S. now
offer courses on entrepreneurship; 60% of Gen Y business owners
consider themselves to be serial entrepreneurs, according to Inc.
magazine. Tellingly, 18 to 24-year-olds are starting companies at a
faster rate than 35 to 44-year-olds. And 70% of today's high schoolers
intend to start their own companies, according to a Gallup poll.

An upcoming wave of new workers in our society will never work for an
established company if they can help it. To them, having a traditional
job is one of the biggest career failures they can imagine.

Much of childhood today is spent, not in organized sports or
organizations, but in ad hoc teams playing online games such as Half
Life, or competing in robotics tournaments, or in constructing and
decorating MySpace pages. Without knowing it, we have been training a
whole generation of young entrepreneurs.

And who is going to dissuade them? Mom, who is a self-employed
consultant working out of the spare bedroom? Or Dad, who is at
Starbuck's working on the spreadsheet of his new business plan?

In the past there have been trading states like Venice, commercial
regions like the Hanseatic League, and even so-called nations of
shopkeepers. But there has never been a nation in which the dominant
paradigm is entrepreneurship. Not just self-employment or sole
proprietorship, but serial company-building, entire careers built on
perpetual change, independence and the endless pursuit of the next
opportunity.

Without noticing it, we have once again discovered, and then raced off
to settle, a new frontier. Not land, not innovation, but ourselves and
a growing control over our own lives and careers.

And why not? Each step in the development of American society has been
towards an ever-greater level of independence, freedom and personal
liberty. And as the rest of the world catches up to where we were,
we've already moved on to the next epoch in the national story.

But liberty exacts its own demands. Entrepreneurial America is likely
to become even more innovative than it is today. And that innovation
is likely to spread across society, not just as products and
inventions, but new ways of living and new types of organizations.

The economy will be much more volatile and much more competitive. In
the continuous fervor to create new institutions, it will become
increasingly difficult to sustain old ones. New political parties, new
social groupings, thousands of new manias and movements and millions
of new companies will pop up over the next few decades. Large
corporations that don't figure out how to combine permanence with
perpetual change will be swept away.

This higher level of anarchy will be exciting, but it will also
sometimes be very painful. Entire industries will die almost
overnight, laying off thousands, while others will just as suddenly
appear, hungry for employees. Continuity and predictability will
become the rarest of commodities. And if the entrepreneurial
personality honors smart failures, by the same token it has little
pity for weakness. That fraction of Americans  10%, 20%  who still
dream of the gold watch or the 30-year pin will suffer the most . . .
and unless their needs are somehow met as well, they will remain a
perpetually open wound in our society.

Scary, exciting, liberating, frustrating, infinitely ambitious and
thoroughly amnesic. If you live in a high-tech community like Silicon
Valley or Redmond or Austin, you already live in this world. It's hard
to imagine more exciting places to be.

For all of our fears about privacy and security, for all the added
pressures that will be created by heightened competition and clashing
ambitions, America as an entrepreneurial nation will reward each of us
with greater independence  and perhaps even greater happiness  than
ever before. It waits out there for each of us. Being good
entrepreneurs, it's time to look ahead, develop a good plan, and then
bet everything on ourselves.

Mr. Malone's next book is "The Protean Corporation" (Random House).
This essay was adapted from a recent speech at Santa Clara University.