Since 1995, Gartner, the research, advisory, and information technology firm, has been developing a graphic representation —the Hype Cycle— that offers insight into the maturity, adoption, and application of emerging technologies, showing how technology trends will evolve.
What does the Hype Cycle look like? It is a curve that shows the five key phases of a technology's life cycle, starting from its birth and progressing to its maturity, and finally to its widespread usage and adoption. Each stage describes the current expectations about technology and its real application within the context of a specific industry.
In this video from Scalabl's online course, Francisco explains why understanding how new technologies work is fundamental to grasp the startup ecosystem's logic around the world. Let's see how technology and investment are related.
Oddly enough, investments made by financial intermediaries (VCs) happen on the counterintuitive moments of the Hype Cycle, by now a widespread tool. VCs enter the beginning of the innovation trigger and leave before the peak of inflated expectations; they gain fortune on the way by doing rounds and getting fees; when the technology is punctured, everyone suffers.
Now, let's see the video and discover how this curve can help us unveil the logic that drives VCs' decisions to invest in specific technologies and not others, and at what point in their life-cycle do these investments come in. This video will help prove our view about how the current startup ecosystem works and acquire another way to build up a business.
We teach our entrepreneurship students that they can't go into the spike to make a market disruption. Still, those who want to make a future disruption with exponential technology can do so by following the right methodology and always considering the stage of evolution and timing of the technology.