Apparently, Jon Kaplan, the founder of the (sold to Cisco and now shuttered) Flip camera, is going into the grilled cheese business. He is starting a chain of fast grilled cheese sandwich businesses, with $20MM+ from Sequoia to boot.
I have seen a lot of reporters and bloggers surprised, asking what a guy like Kaplan, a tech founder, is doing in the food business, and what Sequoia is doing funding it. I say, all the better.
Tech is by far the most innovative sector of the global (and especially the US) economy. The reason is not just the ability to change rapidly, but the innovative mindset, ability to bring faster returns, and, quite frankly, lighter regulation. In my experience in Israeli business, I have come to the realization that the tech sector succeeded because it grew too quickly for the bureaucratic regulators to crush it, and by the time they wanted to, it was too valuable.
However, the bulk of the economy is not in tech; it is in everyday activities of non-tech sectors. Food, clothing, transportation, travel, manufacturing, furniture, janitorial services, window replacement, etc. etc. Many of these sectors are desperate – and ripe – for innovation of the kind that tech entrepreneurs can bring. Sequoia may be looking at the revenues and market cap of other specialty food chains, but Kaplan, IMHO, is looking at innovation.
Many have bemoaned the loss of jobs to offshoring. Whether the trend is good or bad for local economies and trade is not an issue I want to address here. But, I have no doubt that better innovation in many sectors can bring efficiencies and operations that allow these roles to remain onshore.
Unleash the tech entrepreneurs.