Some thoughts about the similarities between Hollywood and Silicon Valley:

When I started my very first startup in the computer games business, way back in the mid 1980s and software was packaged in ziploc baggies and 5" floppies, I was living in Pacific Palisades, in this odd apartment building near the beach on Sunset Blvd. It was nestled between the Yogananda Lake Shrine and the world headquarters for Transcendental Meditation. For good measure, Carlos Castenada's power spot was reputed to be across the street. Such a New Age draw was too much for Hollywood flotsam, and would-be screenwriters, models and budding actors flourished. My next door neighbor was Chris Penn, down the hall were Ally Sheedy, Tina Gallegos (Miss L.A.), and a pantheon of wannabes. I was amazed that Shirley Maclaine didn't live in the building.

What's amazing about Hollywood, is that everyone - and I mean EVERYONE - was working on a screenplay. Well, except me. I was working on a videogame and a business plan. I figured that as long as I refused to write a screenplay, I was safe in L.A. I would never turn into one of those guys dressed in a black shirt and leather jacket, thanking Jesus for finally dragging my sorry ass into recovery, begging for five minutes with any studio executive who might have crossed his path, somehow managing to survive on nothing but hope and yoga.

What struck me was when my next door neighbor, Chris Penn invited me over, and I realized that his apartment was identical to mine, except that instead of programming on an IBM PC compatible, he had one of these new fangled Macintoshes. "What are you doing with that?" "Oh, writing a screenplay." Bang, it hit me. What we do is the same. We stay up all night, creating a vision, praying that someone besides us will believe in it, and eventually, it becomes something that is encoded in bits or captured on silver nitrate.

Well, eventually, the allure of Hollywood corrupted me, and I signed up for Robert McKee's screenwriting class, and banged out a sci fi screenplay. Even managed to option it to some small production company. But in the end, I knew it was time to leave... Silicon Valley was calling. So I packed up my bags and headed for something more solid and substantial than the Hollywood dream machine. It was the right decision for me -- I ended up selling a zillion copies of my various computer games, raised $20 million in venture capital over the years, etc etc. Yes, the recession really stung, but I have learned some valuable skills in high technology.

But over the years, I've realized that the road I took was not so dissimilar to the one I forsook. A screenwriter is very much like an fledgling entrepreneur/visionary, living on the good graces of the "angel" community for interim financing. And screenplays are like businessplans... 90% fiction and 10% hope. And VCs are just like Hollywood executives, who "suggest management team changes" instead of killing off your favorite characters and completely changing the concept of the film, have the power to invite you to lunch with them at the hotspots like Buck's in Woodside, and inevitably leave you in perpetual state of "almost greenlighted". And the cost of doing a deal with the "devil" is usually giving up control. Now, I have to say that most first time entrepreneurs really are crummy at being CEOs, but you know, sometimes they're better at it than the "world class CEO" that is brought in. Case in point: Steve Jobs.

Anyway, back to the analogy. Consider the tendency to fund too many online pet food companies or asteroid disaster films. Doesn't that "world class CEO" eventually act an awful lot like that "world class director" who completely revamps a script in his own image? Doesn't the writer/visionary/enterpreneur eventually get screwed 99% of the time? Are a few points of the net really the same as shadow stock that's underwater? Consider this: 50,000 screenplays are registered every year with the Screenwriters Guild, how many make it to theatrical release? 200? What's the track record for Silicon Valley? Of about 100,000 ventures that get funded by professional venture capital... how many make it to an IPO? In a good year, 200-300, right? Isn't the return on hope about the same?

Well, there's one fundamental shift that's changing both entrepreneurship and indy filmmaking. Indy filmmaking, empowered by low cost digital video solutions, is an awful lot like the explosion of Indian programmers - which has made it possible to spend $25,000 instead of $200,000 to code up a prototype of an idea. Now, you can actually shoot a feature film, and edit on Final Cut Pro, for maybe $300,000 instead of $3 million. This makes it possible, to profitably produce direct to video (I mean, IF you land a negative pickup deal), and even have a chance to DO IT YOUR WAY. Hollywood studio executives and VCs have a tendency to impact the vision... usually in a positive way for the venture or film, but often to the distress and aggravation of the screenwriter or visionary. Now, it may be possible to get a film made, that is true to the vision of the original writer.

So, I think that in the long run, Moore's Law will positively impact both high technology and filmmaking, as the Information Revolution continues to drive costs of bit-production down by an order of magnitude per decade.

Anyway, that's my two cents on the issue.