I'm going to advance a counter-argument (just because I'm like that). Jason makes the argument that these people are getting pitches from individuals who don't have a quality product or connections. I'd argue that's its almost always connections. That's what I experienced at digg, which was in general a second rate idea (it was done before by kuro5hin and delicious mostly) but was advanced by the ultimate insider. This is just simply creating a market, Jason feels threatened because while he may have come from the bottom, he's no longer there, and this is a direct threat to his (and every other insider's) influence.
I'm not a big fan of Ayn Rand, but there's a great passage in "Atlas Shrugged" about how once you destroy markets, it becomes all about influence and insiders and "who knows who." This is just a new market mechanism that subverts the insiderish nature of the angel community.
It doesn't mean it will work, but it's a reaction to scarcity controlled by influence, and is just creating a market mechanism where one is needed.
I don't see how digg is similar to kuro5hin or delicious - kuro5hin was about essays, delicious was primarily about serving personal needs (saving bookmarks) first. They seem very different to me. Digg also inspired a bunch of similar sites using the same mechanism (like Reddit and Hacker News) which suggests that digg had something genuinely new to offer.
Unless I'm mistaken, kuro5hin had a voting mechanism to determine what appeared on the front page. And delicious had it's "popular" page. Anyway my argument is:
a. "connections" are a scarce commodity, and probably the primary thing that a startup needs.
b. A market mechanism is replacing influencers. That's most likely a good thing.
and an additional remark - the first people who do this are obviously going to price high. The prices will get driven down by the same supply/demand mechanism that created the market in the first place.
I'm not a big fan of Ayn Rand, but there's a great passage in "Atlas Shrugged" about how once you destroy markets, it becomes all about influence and insiders and "who knows who." This is just a new market mechanism that subverts the insiderish nature of the angel community.
It doesn't mean it will work, but it's a reaction to scarcity controlled by influence, and is just creating a market mechanism where one is needed.