

Another day, another startup promising to change everything — that’s been the climate in technology for the past few years, and analysts wonder how much longer it can last.
The way to avoid the bubble burst some see as inevitable is to get real about profitability, according to Steve Herrod, managing director of General Catalyst Partners. He said his venture capital firm is becoming more shrewd about sussing out profitability in the startups that approach them for seed money, because, “That’s how you go from being a technology to being a business.”
Herrod told John Furrier, cohost of theCUBE, from the SiliconANGLE Media team, that seed funding is pretty easy to get in Silicon Valley if you’re a smart entrepreneur with a good idea. Round B, however, is what separates the wheat from the chaff and requires companies to show a pattern for making sales that has worked and is repeatable.
“Creating a new company is so top of mind for people who wouldn’t have previously thought of that,” said Herrod. He stated that many college graduates who would have gone on to law school or med school in the past are now looking to make it big as entrepreneurs.
The influx of talent doesn’t show any sign of slowing, and Herrod contends that cycles of boom and bust can’t really affect that vitality. “Real innovation doesn’t have a cycle,” he said.
Watch the full interview below, and be sure to check out more of SiliconANGLE and theCUBE’s on-site event coverage.
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