Does the saying "it's not what you know, it's who you know" become less relevant as we all know everyone via ubiquitous social networks? originally appeared on Quora: the place to gain and share knowledge, empowering people to learn from others and better understand the world.
Until the proliferation of social networks, the who-you-knows had higher earning power than the what-you-knows. But today it is better to be a what-you-know.
The who-you-knows are the middlemen -- the investment bankers, corporate lawyers, real estate brokers, etc. The people that generally put two people together and get some sort of benefit from the transaction. These made up most of the best paying professions in the last fifty years.
But today, computers and the Internet are assaulting the who-you-know professions faster than the what-you-know professions. And while having a large network will always be important, "weak ties" (one's network beyond the first fifty closest friends) are much less important today then they were in the past.
It actually has always been better to be a what-you-know. Part of the value of being a good who-you-know is access to proprietary information. Turns out that the who-you-knows were often the most interesting people because they spent their time talking with lots of what-you-knows and soaking up information. Today it is more easy to gain access to information by just reading the Internet, so the knowledge of even some of the best who-you-knows are much less proprietary.
Networks and weak ties are getting more commoditized than before. One good example of this is access to capital. While getting access to capital is still very hard, it is much easier than it was for every category. That means the value of a who-you-know (like an investment banker whose job it was to get capital for your idea) is much lower now than it used to be. In today's world, capital is chasing good ideas (rather than than ideas chasing capital which was the norm until recently).
Young people should focus on understanding. Understanding beats networking. Knowledge beats weak ties.
Of course, having weak ties is still important. One's network is still incredibly important in all parts of life... it is just not as important as it once was.
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