The parallels of Web 2.0 with the Open Source and Social Innovation threads

The recent issue of the Open Source Business Review is all about Social Innovation – what appears to be a an experiment in seeing how these two memes both converge and diverge. (hat tip to Mark Surman for pointing me there).

At the same time, this convergence is not unique to those fields. The quotes below from a recent post by Brad Burnham at Union Square Ventures point to some very strong parallels to the content in some of the pieces in the Open Source Business Review.

The common threads among all these areas are systems level work approached with a common emerging values/mindset in the context of pervasive adoption of communication and collaboration technologies. They are also employing a new mode of organization that is increasingly permeable, iterative, and emergent.

In a society that is at its physical limits and where the systems that took it there are breaking down, this type of convergence isn’t surprising but it is encouraging. For those who can navigate it, the transition might not be comfortable, but it is full of opportunity.

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Craigslist. That service is essentially a very lightweight governance system that manages an enormous collection of users who contribute all of the content and much of the oversight that makes the service work. It is because Craig and Jim focus on managing the efforts of their users instead of doing the work of those users that Craigslist is so phenomenally efficient. Many of the most interesting web services are like Craigslist, at their core, lightweight governance systems. Facebook and Twitter come to mind.
It used to be that innovation started with NASA, flowed to the military, then to the enterprise, and finally to the consumer. Today, it is the reverse.
The creators of these services recognize that services like theirs will ultimately disrupt the economics of many, if not most, parts of the global economy in much the same way that Craigslist collapsed the multi-billion dollar classified industry into a fabulously profitable multi-million dollar web service.
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Union Square Ventures and a new kind of Venture Capital firm.

Yesterday’s, NYTimes article on Union Square Ventures (USV) entitled “A New Kind Of Venture Capital Firm” is an interesting read and I’m glad to see the media beginning to pick up on this.

I’ve been following USV for a whlie now and actually interviewed Brad Burnham in preparation for a session at the Open Everything Retreat on Investing in Open. They seem to have a knack for investing in webtech ventures like Twitter and Wesabe that have models that can be deeply disruptive to the systems they are taking on and where the question of how they are going to make money from them is far from answered. And now they’re turning more of their attention to conventionally ‘social’ issues including education and the environment.

Coming off my latest exploration of the social venture capital sector, I’m looking forward to seeing USV coming into this space – and I don’t think it’s much of a stretch. Investments like Twitter and Wesabe are not too dissimilar from making investments in social change and innovation. Both are venturing toward systems level change – and come with a high degree of complex ambiguity.

At the same time, we are beginning to see a new mode of organization taking shape that challenges how ventures are built and therefore how we invest in them. Where all of these things come together is where I’m betting we are going to find some deep innovations on the new kind of venture capital firm I think USV and others are all working their way towards.

In the meatime, if you’ve encountered – or are thinking of – any innovations in this area please pop them in the comments or over in the public wiki on ‘Investing and Open‘. I’m playing with some ideas myself and will be adding them in there and here on this blog as they develop.

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