The optimism that many felt in the 1960s over labour-saving technology is giving way to a fearful question: 'Will your labour be good for anything in the future? Or will you be replaced by a machine?'
Whereas a competitive firm must sell at the market price, a monopoly owns its market, so it can set its own prices. Since it has no competition, it produces at the quantity and price combination that maximizes its profits.
One of my friends started a company in 1997, seven years before Facebook, called SocialNet. And they had all these ideas, and you could be, like, a cat, and I'd be a dog on the Internet, and we'd have this virtual reality, and we would just not be ourselves. That didn't work because reality always works better than any fake version of it.
Investors are always biased to invest in things they themselves understand. So venture capitalists like Uber because they like driving in black town cars. They don't like Airbnb because they like staying in five-star hotels, not sleeping on people's couches.
Had the people who started Facebook decided to stay at Harvard, they would not have been able to build the company, and by the time they graduated in 2006, that window probably would have come and gone.
Credentials are critical if you want to do something professional. If you want to become a doctor or lawyer or teacher or professor, there is a credentialing process. But there are a lot of other things where it's not clear they're that important.
As an undergraduate at Stanford, I started 'The Stanford Review,' which ended up being very engaged in the hot debates of the time: campus speech codes, questions about diversity on campus, all sorts of debates like that.
If I had known how hard it would be to do something new, particularly in the payments industry, I would never have started PayPal. That's why nobody with long experience in banking had done it. You needed to be naive enough to think that new things could be done.