Any day now, our landlord will finally deliver a working swipe mechanism to open our office door. Meanwhile, since we moved in, we’ve had to use a physical key to get in, even though we already have the cards that let us into our parking garage. What leads to this rumination, though, is my recent car purchase.

I bought a 2006 Toyota Prius, which came with a smart key. I don’t need to pull the key out to open the car or operate it. As long as I have the key on my person, the car talks to it to establish my authenticity and allow me to open the door and push the start button. It’s kind of eery, actually, for an older guy like me: I walk up to the car and when my hand reaches the door handle, the car senses my proximity, talks to the key and unlocks.

My life now: I physically lock the door to my house, walk up to my car and drive away. I swipe me and my car into the parking garage, swipe myself into the gym, and then take a key out to open our office door. Any day now, of course, our landlord will finally deliver a working swipe mechanism; then I can use one card for both parking garage and office door.

Why do I have a key? Isn’t it feasible and affordable now to install electronic locks everywhere, including my house? Indeed, if it is feasible, why the heck do you need different electronic fobs or cards for each entry point? Why can’t I use my ATM card or cell phone or something else I already carry around? (See this post on my personal blog for another smart-card experience, but I don’t want my identity stored on that one!)
You can feel it: The future isn’t too far around the corner.

Last year, more than 1,500 Web 2.0 companies were started in Silicon Valley, according to the January 22 edition of The Guidewire Report.

We believe the number: We see a lot of Web 2.0 pitches from young entrepreneurs. The basic pitch: for an investment of $2 to $5 million, they can build a company that Google, Yahoo or Microsoft will buy. And, in under two years, we can get 5-10 times our money back. How could you not like that?!

We don’t. We always decline to participate in deals like that. We think this is a kind of disease, often caught by these youngsters in business school. They are looking to cash in on Web 2.0 fever and flip their companies quickly for a nice tidy sum.

These entrepreneurs confuse a feature for a company. Often these ideas depend on a platform controlled by the large company that they want to sell their company to. But they can’t get traction without permission from the large company. Examples include on-deck mobile phone features, new enhancement for a CRM service, or a cool feature for search engines. When someone else controls the platform, someone else controls the market — and the exit.

If Guidewire is right, we can assume some of those 1500 companies are doing more than features (including the three companies in our portfolio that would be classified as Web 2.0). But we know a lot of those companies are following exactly this trajectory, and they’re chasing the same markets with only minor variants to the theme. These deals are not only over priced but tend to lead to dysfunctional behavior among the competitors.

How can you tell a feature company? They let the competition define their product or service. You can see it in their Powerpoint presentations. On a slide, often one that appears before the product is defined, they list a half dozen new start ups that nobody outside of the blogosphere and venture capital have heard of. None of the “competitors” have gain market traction and most enterprises or consumers have never heard of them. These entrepreneurs mistake venture-based valuations for market validation.

Great companies are built by entrepreneurs who want to change the world. They have a basic belief that they will be rewarded for either defining a new market or redefining an old one. They do not want to be bought by Google or Yahoo!, they want to be the next Google or Yahoo!. My parents used to tell me two things about starting businesses, “if it’s easy, everyone would be doing it” and “easy money seldom is easy.” Most Web 2.0 entrepreneurs never learned those lessons. If Web 2.0 is to have legs, then we need find a new generation of entrepreneurs who are willing to build their companies to last rather than to flip.

The Wall Street Journal reports that PC sales got a big boost from Vista. “[A research] firm said that unit sales of PCs at U.S. retailers for the week ending Feb. 3 jumped 67% versus a year ago and 173% from the prior week, when Vista was not available.”

Does that surprise you? One week there are no computers available because Microsoft made the OEMs and retailers stop selling them. The next week, sales jump 173%. Seems little early to be celebrating.