At a conference about a decade ago in Silicon Valley, I ran into venture capitalist Steve Jurvetson during a break. “Hey, what’s new?” I asked. He responded with the zeal of a true believer. “Andy, I’ll tell you what’s new. What’s new is that SpaceX is going to bathe the world in cheap internet connectivity via satellite.” As near as I can recall, my response was, “Wow, that is so interesting. I need some more coffee.”
I got away as quickly as I could because Jurvetson’s few sentences had convinced me that he had lost all judgment. He was, after all, telling me about something that surely wasn’t going to happen. I’m no expert on the global aerospace industry, but I knew that it was large and lucrative and populated by well-established, well-capitalized, well-connected companies that had figured out how to do some of the most difficult things we humans have ever accomplished, like launching rockets capable of escaping Earth’s gravity and putting humans into space and then bringing them home safely. I also knew that satellite communications was not a new field. Telstar was launched in 1962.
So my immediate, reflexive reasoning as I fled Jurvetson’s company was something like “If what he’s saying is anywhere near possible, we would be seeing at least some of it already. Some of the incumbents in the industry would already be providing affordable Internet from space, or at least demonstrating that they were on that path. The fact that they’re not tells me that there’s a combination of physics, engineering, and inescapable cost that makes this vision I’m hearing a fantasy.”
The punch line here, of course, is that I am writing this on a laptop connected to the Internet via Starlink. I’m one of the service’s 12 million customers (and growing) around the world, and I’m delighted with it. Jurvetson, it turns out, was exactly right, and I was exactly wrong.
Once I got over my bruised ego, I got to thinking. I’m a business academic. For over 30 years I’ve been studying how technology progress changes the business world, first at Harvard Business School and now at MIT Sloan. In particular, I study how new technologies change the way that companies operate, perform, and compete.
My dismissal of Jurvetson’s spot-on prediction showed me how much I had to learn. From a standing start in 2002, SpaceX had delivered a new and important capability, accomplished marvelous feats of engineering not just in a lab but at orbital scale, and created a large and lucrative global market. While doing so, it made all the incumbents in the aerospace industry look bad at their own game on their own turf.
The Geeks Appear
I didn’t think this kind of breakthrough performance was possible, but it is. And it’s not just SpaceX. Here’s a short litany of other impressive recent accomplishments:
Netflix began as a DVD rental-by-mail company in 1997, and started streaming entertainment to our homes in 2007. Its most audacious move, though, came three years later, when it announced that it wasn’t just going to license entertainment from Hollywood studios. It was also going to become a Hollywood studio itself by creating “Netflix Originals.”
Mainline Hollywood didn’t see much ground for concern at this upstart’s incursion into their territory. Time Warner CEO Jeff Bewkes spoke for many in his industry when he responded in 2010 to a question about the threat posed by Netflix. “It’s a little bit like, ‘Is the Albanian army going to take over the world?’ I don’t think so,” he said. Fifteen years after that interview, Netflix announced that it had entered into an agreement to acquire Warner Bros. Discovery (the company later declined to match a higher all-cash bid from David Ellison’s Paramount).
The payments platform Stripe was founded in 2010 by brothers Patrick and John Collison when they were 21 and 19 years old, respectively. As Patrick explained in a 2018 interview, the insight behind the company was that anyone wanting to become an online entrepreneur could set up a web storefront “as fast as you could type” with one key exception: gaining the ability to accept a credit card from a customer could take days, and carried the prospective merchant backward in time to the era of faxes and mailed forms. Even though payment processing was a large global industry dominated by the behemoths Visa (founded in 1958) and MasterCard (1966), a credit card acceptance API didn’t yet exist.
Today, that’s amazing to consider. It was Stripe that built that API — and kept building. And now, Stripe processes online and in-person payments for customers ranging from embryonic startups to Amazon, Nvidia, and PepsiCo. It also provides revenue and billing services to merchants, lets them pay vendors around the world, and manages tax reporting, fraud detection, and anti-money laundering and know-your-customer requirements globally. In 2016 Stripe launched Atlas, a service that lets entrepreneurs around the world quickly establish a US corporate entity and bank account. Less than a decade later, one-quarter of all Delaware incorporations came from Atlas.
Defense tech startup Anduril was founded in 2017. Within five years it received its first billion-dollar contract. It was from the US Special Forces Command for a variant of the Anvil, a drone designed to autonomously destroy other uncrewed aerial vehicles. The Anvil project was born during a weekend brainstorming session in early 2019. Initial prototypes showed promise, and by summer Anduril was claiming a near-perfect success rate. By the end of that year, the company was shipping the Anvil to military clients. In early 2023, according to some reports, it was being used in Ukraine.
In early 2024 Anduril was awarded major contracts to build both undersea and airborne autonomous systems for the Pentagon. The company also beat out Boeing, Lockheed Martin, and Northrop Grumman to be named one of the two main suppliers to the Air Force’s Collaborative Combat Aircraft program to develop autonomous planes to accompany crewed fighter planes. A statement from the company stressed that “The Air Force’s decision marks the first time that a new company has won a fighter aircraft program since the 1970s.”
And of course, SpaceX has accomplished much more than Starlink. In 2017, just 15 years after its founding, the company successfully relaunched the first commercially viable orbital rocket. It has now executed more than six hundred such relaunches; Jeff Bezos’ Blue Origin has done one and the rest of the global aerospace industry combined, none. The huge cost advantages associated with rocket reuse, combined with SpaceX’s aggressive launch schedule, have made the company a near-monopolist in the business of putting payloads into space — including its own Starlink payloads.
And if SpaceX succeeds with its gigantic Starship rocket, which can carry four times the payload of its current rockets, its costs could fall a further 90% or more. Starship’s Flight 13, which took place in July of 2026, was encouraging; both the booster and upper stage successfully relit their engines in space, an important milestone for controlled descent and reuse. SpaceX also makes spacecraft for human flight. In 2020, its Crew Dragon vehicle passed a final test — a round-trip flight of astronauts to the International Space Station — and became the only American company certified by NASA to take US astronauts into space from American soil.
The industries in the examples above vary, but the story doesn’t: impressive achievements and growth in a short space of time by an upstart, and incumbents left well behind. The upstarts are all young, and all based on the West Coast. Most of them also have a clear Silicon Valley lineage. (Elon Musk came from PayPal, for example, and Anduril’s founders from Palantir and Oculus).
There were similar shake-ups earlier in this century. Several industries, including retail, recorded music, periodicals, advertising, urban transportation, and consumer electronics were profoundly transformed not by well-established incumbents, but by West Coast upstarts. And while Silicon Valley was serving as the cradle of many of these disruptors, it was also continuing to solidify its position as the center of the global high-tech industry.
A New Doctrine for Value Creation
Am I cherry-picking and overstating the case, or is concentrated value creation a broad trend?
In 2000, 15 of the top 100 most valuable public companies in the US were headquartered on the West Coast, representing 17% of the total market capitalization. Even then, there was a sizable cluster of high-tech companies in Northern California (plus Microsoft in Seattle) contributing to the West Coast’s share, but most of the value and most of America’s largest companies were elsewhere: financial services and pharmaceuticals in the Northeast, oil and gas in Texas, and so on.
A quarter century later in 2025, the West Coast had 35 of the top 100 companies — representing a whopping 64% of the total market capitalization of the top 100. And with the exception of Microsoft, all the biggest companies on the list — Apple, Nvidia, Alphabet, Amazon — were barely factors in 2000. Some, like Tesla and Meta, didn’t yet exist.
What’s going on? What’s behind this huge and unprecedented shift in the business landscape? My answer is straightforward. As I wrote in my 2023 book The Geek Way: “a bunch of geeks have figured out a better way to run a company.”
The geeks of Silicon Valley might not have wanted to become organizational innovators, but they found they had no choice. The principles and practices built up over the 20th century for running a large, successful company simply didn’t work in their ecosystem, which was characterized by the extraordinarily rapid rates of change summarized as Moore’s Law and by intense competition for new global markets.
So the geeks did what geeks do: they innovated, tinkered, and experimented, and kept at it until they came up with something that worked.
I call that something a new doctrine for business competition. The US Joint Chiefs of Staff define doctrine as “fundamental principles that guide the employment of US military forces in coordinated action toward a common objective and may include terms, tactics, techniques, and procedures.” Let’s tweak this definition a bit for our purposes: business doctrine consists of fundamental principles that guide people within an organization in coordinated action toward a common objective. Doctrine includes terms, tactics, procedures, and attitudes.
I see five broad principles that distinguish 21st century “geek doctrine” from what came before, which I’ll refer to as legacy doctrine. These are cadence, science, observability, modularity, and agency. Let’s take each in turn.
