The Movement of Capital

In the early 20th century, the new rich who rose with the growth of commerce and industry, the steel kings, oil kings, and banking kings, clashed with the aristocracy that had made its money from the 18th and 19th century slave trade. The old power spent its days throwing lavish aristocratic parties and showing off its wealth, but this newly arrived ruling class had made its money from labor-intensive industry, so it had to preach 'diligence and sincerity' to its workers, and a man in a suit who was not from a noble house and looked stern, solemn, and serious became the prototype of the successful rich man.

And industrialization, mass production, and the conveyor belt innovation overturned the old labor-intensive production system and moved wealth. What is interesting, though, is that once the 21st century arrived, the people who had made their money in oil, steel, and banking had themselves become the old power, while the newly rising Silicon Valley power looked different again from the power before it. As the development of IT maximized the productivity a single individual could exert, the prototype of the rich man became someone who gets rich with a few lines of code written on a computer in a back room, not someone who leads a mass of employees and preaches diligence.

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What characterizes them is the nerd type, weak on social skills but obsessed with computers, far from the glamour of the old power a hundred years ago and just as far from the diligence and stern solemnity of today's old power. They watch anime and play games in a back room, and once they lock in they work for hours on end.

So why are the nerds ruling the world? Thinking about why the startup boom took off in the 2010s: an acquaintance of mine worked on a game project like Nom or Minigame Paradise, and he said it took over a hundred people in total, including QA testers.

But now that has become a game two skilled Unity developers can make. The sector whose productivity rose the most in the 21st century is IT, and that higher productivity made it possible to turn out the final product with only three or four developers.

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It has become a world where 13 employees, six or seven of them developers, build a company worth a trillion won and exit. open AI too built a company worth 100 trillion won with just a few employees.

One of the rules of Silicon Valley is that investors shy away when a CEO in a crisp suit presents with a flashy slide deck. That is why, when the NYT criticized FTX for testifying in a T-shirt, it ran a piece saying it was time to put on a suit for once.

Much as a hundred years ago, the old power and the new power are clashing again. Apple started with a single mp3 player and, through the smartphone, laid the ground for new platforms to grow, and with Apple Pay it has been eating into the payments market. Microsoft's Excel brought innovation to accounting work, Google's search technology brought the fall of advertising and newspapers, YouTube brought the fall of media, Tesla is popularizing electric cars and self-driving, and Netflix has presented a new paradigm across the film industry, all of which is collapsing the old power.

In the 1990s Nasdaq's advertising copy was the stock market for the next hundred years, and it is actually turning out that way. I too see the 21st Century as the world of tech stocks. You have to invest in the tech stocks that will lead the future. What Marc Andreessen wrote ten years ago, the article Software Is Eating the World, is still perfectly valid and will remain so.