Many in Silicon Valley will only privately confide that between soaring valuations and plummeting exit opportunities, they think a crisis is brewing — or at least one colossal bubble. But not Jawed Karim, an early engineer at PayPal who went on to co-found YouTube with his PayPal colleagues Steve Chen and Chad Hurley.
With surprising candor, Karim — who reportedly walked with $65 million in Google stock when YouTube was acquired and is now getting his Ph.D at Stanford — tells the Minneapolis Star Tribune that: “Silicon Valley has a lot of noise, a lot of hype. People are very excited about all the Facebook stuff, Facebook applications. It’s just been a huge hype over the last year when actually…there isn’t really that much value. it’s just a bubble. It’s almost a distraction. You don’t have these bubbles of nonsense [outside of the Valley].”
I doubt that kind of talk is going to endear Karim to Mark Zuckerberg. It also seems vaguely treacherous for someone who has greatly benefited from two targets of almost profoundly exaggerated publicity to poop on hype. Not last, I’m wondering how the bubbly environment is impacting a side project of Karim’s: Youniversity Ventures, through which Karim and two partners meet with entrepreneurs on Stanford’s campus every quarter to entertain pitches. (They offer up their contacts to the most promising companies they see.)
For my part, I kind of find Karim’s comments refreshing — and instructive. Not only could the Valley could use more straight shooters, but I also think the warning shot of someone who’s been at ground zero of the Web 2.0 phenomenon (through serendipity or otherwise) is probably worth heeding.