The Value of Technology Is Determined Outside Technology

Technology by itself is only a possibility. It gains value only when someone actually uses it.

But what is technically good and what is good for people to use are not the same. Better performance alone does not change human behavior.

Researchers tend to see problems that are novel and difficult. Users see how easily and reliably their own problems are solved.

This often creates a gap between the problems researchers consider important and the problems people actually care about. The more we speak only among PhDs, the harder that gap becomes to see.

Getting someone to pay is harder still. Being useful is not enough. There must be a clear reason that makes going without the product more costly than paying for it.

Building good technology and building important technology are therefore different things. If a technology does not change human choice, its impact remains limited, however impressive it may be technically.

Research asks what can be built. People ask why they should use it. Business asks why they should pay for it.

This is where the startup presents an interesting structure. The problem a startup solves does not necessarily have enormous demand today. Some companies are assigned immense value without producing any revenue at all.

Investors are not buying the technology as it exists today. They are buying the possibility of the returns it may produce in the future. Along with its product, a startup sells a claim on the future.

That future does not yet have a concrete form. No one knows whether demand will emerge, whether the company will survive by moving into another market, or whether it will gain a dominant position. Because it has no concrete form, expectations can expand far beyond the evidence available today.

Investors absorb this uncertainty through a portfolio. If one success can cover every loss and still produce a return, there is a reason to invest even without present demand or revenue.

This, too, is demand. Users buy the utility a technology provides; investors buy the possibility of the returns it may generate. They buy different things, but both choices begin with human desire.

The value of technology is therefore not determined simply by how well it works. What problem it solves, what future it makes credible, and how many people and how much capital that belief can move all contribute to its value.

But expectations cannot replace demand forever. Finance can pull future value into the present, but if that future never becomes real demand, the value disappears.

Technology must therefore understand human beings. It can solve a problem or sell a dream about the future. But to endure, that dream must eventually become real demand.