The Trump tech bubble

Late last year, before the November election, John Borthwick warned me that, if Trump won, the mechanics of the entire start-up investment ecosystem would grind to a shuddering halt.

“I was wrong,” the New York-based chief executive of Betaworks now recognizes.

Today, Borthwick admits that he’s “surprised” about how little has actually changed under President Trump. Indeed, in many ways, he acknowledges, things have never been better for early stage investors and incubators of tech talent like Betaworks – particularly in AI which, he says, now offers “extraordinary potential”.

So, I ask, are we in a Trump bubble? Is it 1995 all over again?

Yes and no, Borthwick acknowledges. Certainly the euphoria is similar, he suggests. But the big difference between 1995 and 2017, Borthwick notes, is that today we have the existence of big internet players like Google, Amazon and Facebook which didn’t exist in the mid nineties and which now dominate the digital landscape.

Borthwick worries that today’s exuberance might only compound the power of these already dominant platform businesses — particularly given the Trump administration’s hostility to Obama-era market regulation, especially to network neutrality legislation.

And the other difference, Borthwick adds, is that 1995 has already happened and we have much to learn from it. After the last crazy boom, he says, we need to learn that what he calls “blind optimism” often turns out to be counterproductive. So, yes, he says, enjoy the “exciting times” of today’s Trump boom. But amidst all the euphoria, remember that we have a “responsibility” to produce new products and services that are both sustainable and have social as well as economic benefit.

Many thanks to the folks at the Greater Providence Chamber of Commerce for their help in the production of this interview.