Introducing the Cultural Leadership Fund by Ben Horowitz ’88CC

In the early days of the technology industry, there was no thought about consumers, because consumers were not our customers. The first computer was sold to the United States government and in general we sold technology to technologists trying to build solutions to difficult problems. Tom Watson, the founder of IBM, famously said in 1943 that the worldwide market for computers was 5. While that seems impossible in retrospect, at the time computers were exceptionally expensive, hard to use, and difficult to sell. Logically, this meant that the industry built technology for people in priority order of how much money they had — first to governments, then to big business, then to small business and almost never to consumers. One could see this in popular culture as James Bond had all kinds of cool technology gadgets that consumers could only dream about.

This changed slightly with the advent of the PC, but the consumer market was still relatively small compared to the government and business markets. Once the Internet and then the smartphone hit the scene, the economics reversed themselves: technology became cheap, easy to use, and often free to distribute. As a result, new technologies now go to markets in priority of their size — first to consumers then to small businesses then to big businesses and finally to governments. And now James Bond just uses a smartphone.

As a result, consumer behavior — in other words, culture — has become central to successfully building, marketing, and selling new technologies.

In the meanwhile, one group of people has been responsible for more cultural influence than any other and perhaps all other groups combined. African Americans invented all modern forms of music from jazz to blues to rock and roll to hip-hop. In the United States, most fashion, dance, and language innovation has come from this relatively small community. This is especially significant because worldwide no culture influenced consumer behavior more than U.S. culture.

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