The Internet space has gotten so big that there's not much of an opportunity for entrepreneurs to get in, Yammer CEO David Sacks told CNBC Wednesday.
Sacks made headlines when he declared that Silicon Valley as we know it is coming to an end, in a war of words with legendary venture capitalist Marc Andreessen — in the form of Facebook posts (how very appropriate).
I spoke with the member of the so-called Paypal mafia at TechCrunch Disrupt about how Silicon Valley is changing and where the opportunity lies now. Sacks just sold Yammer to Microsoft for $1.2 billion and has invested in a number of startups, so he has a unique perspective. (Read More: .)
Sacks clarified, he doesn't think it's "the beginning of the end," but rather "the end of the beginning."
To illustrate his point, Sacks said the likes of Google and even Facebook have gotten as big as redwood trees, so in their shade nothing can grow.
He recommends entrepreneurs head out to the fringes of the forest, so they're not in the giants shadows. What that increasingly means, Sacks said, is looking to apply technology to non-technological areas.
The real opportunity, he said, is in native mobile apps.
Sacks pointed to Uber, the car service app, which he's invested in. (Read More: Taxi-Hailing App Uber Blocked From Processing Fares in New York City.)
And earlier this year, he invested in an app called Cherry, which applies Uber's rules to a car wash app. Park your car, check into the app, and Cherry will send a team to wash your car right where you left it.
In the wake of Zuckerberg's comments here at TechCrunch, which boosted Facebook stock, I asked Sacks what he made of the company's dismal performance since its IPO. (Read More: Zuckerberg: Facebook Will Make More Money on Mobile Than Desktop.)
He said the stock's decline has caused people to re-assess valuations and has dampened investment a bit. But still, he said he's still bullish on the venture space and on Facebook in particular.
Sacks gave Zuckerberg his full endorsement, saying he thinks he's doing a great job. He defended attacks on Facebook's mobile ad business, saying Zuckerberg doesn't have a "mobile problem," but rather a massive untapped opportunity. He said he's "bullish" about the potential to target ads in the feed.
Since Yammer is all about social tools for businesses, I asked if he ever sees Yammer — or the other social enterprise companies, like those Microsoft, Oracle and Salesforce have acquired — competing directly with Facebook.
Sacks said absolutely not, that he's never been interested in competing with Facebook, or even LinkedIn but that there's huge opportunity in delivering tools just for businesses.
—By CNBC's Julia Boorstin
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