NEW YORK ( TheStreet) -- When Steve Jobs started Apple ( AAPL) and Bill Gates started Microsoft ( MSFT) the world was much different.
There was no Internet, no CNBC and no Twitter. If your parents bought into the Apple or Microsoft IPOs, they were likely part of the 1% who worked on Wall Street back then.
Also, neither Apple nor Microsoft was funded by a venture capitalist. Do you know how they were able to get off the ground? Although some misinformed politicians have said these tech companies got bank loans (they didn't because, no loan officer would have deemed either company a good risk), they got started by selling something to a customer for money. That customer's money helped them to pay their staffs and reinvest in their businesses. Fast forward to today. Any new company has to be judged hot. It's got to generate buzz on Twitter. It's got to get "users" on its cheap Web site. That proves to some tired venture capitalist somewhere that there's a real business here. However, many VCs now encourage their portfolio companies to delay profit-generation. "All in good time," seems to be the thinking. So, VCs have taken on the attitude of many American parents these days, as described in the Tiger Mom book: Everyone's a winner. All the kids should get a trophy. Kids should experiment. They should go off to back-pack through Europe to find themselves. It will all work out in the end. Follow your bliss. And now, with Mark Zuckerberg, we have the first real Generation Y guy manning the ship of a big-time IPO. It's interesting to think about how a Baby Boomer or Gen Xer would have run Facebook (FB) differently over the last few years. A Gen Xer (and I'm one) likely would have sold Facebook to Yahoo! ( YHOO) for $900 million or to Google ( GOOG) for $2 billion or whatever it was. Hey, $1 billion is awesome. You don't need more to live on for the rest of your life. Take the money and run.