Banker's Guide to New Small Business Finance: Venture Deals, Crowdfunding, Private Equity, and Technology, + Website

Chapter 4A Paradigm Shift Created by Amazon, Google, and Facebook

Our presumptions of markets must be rethought.

—Chris Anderson, Editor-in-Chief, Wired magazine

While the timbers were falling in the U.S. housing market and the financial sector was on the ropes, another transformation was occurring in the U.S. economy at the same time: We actually arrived in the digital age. More than memory typewriters, wireless telephones, and voice recognition software, the world was moving, sorting, and fully trusting information in the “cloud”¹ like never before.

It’s become quaint (and finally rare) to occasionally learn about a 60-year-old acquaintance who “doesn’t do e-mail.” But we should be paying more attention to the fact that members of Generation Z (not to be confused with the Millennial generation) aren’t doing e-mail, either. In fact, they barely “do” telephones. They text. E-mail just became “too bothersome and too formal.”

Many folks are puzzled at this evolution and continue to defiantly cling to laptop keyboards in the face of all those flying thumbs-to-mobile-device, and that’s okay. But ignoring the reality of the accelerating technological changes and pondering where they will lead will be business suicide in most business sectors, particularly banking.

In the early 1970s, automated teller machines (ATMs) introduced bank depositors to the convenience of withdrawing cash from a dispensing machine 24 hours per day. No more standing in line to cash a check. Simply insert ...