"1. Startups today are generating real revenues off of a massive customer base (thanks to mobile and broadband saturation).
2. Startups with money in the bank or even — gasp! — profits, don’t go out of business! Founders are aware of this and are watching the deflation I mention above and, largely, taking measures to control their burn."
Both are laughable.
1. No, startups today can fund the ongoing chasing of customer counts through lavish spending of investors' money.
Earlier in the article a bullet point called out so darlings (Dropbox and Evernote IIRC) as facing an uncertain future in the face of an easily duplicated business model.
These 'massive' customer bases are as fickle or more fickle than in the past. Earlier today I read: 'no one under 19 uses Twitter.'
What was there massive customer base, again...?
2. Startups with profits go out of business when those profits evaporate because the flow of free investment money dries up for _their customers._
That's the thing I'm watching for in the immanent pop: the cascading crisis as each successive tier whose business models are predicated on the one before it, all falling like dominoes.
It doesn't matter how nimble you are, or how well managed, or ultimately, how well capitalized, if you business is selling to others in the same sector.
Failure goes viral, too.
8/10 for teeth-gritted sweaty-browed optimism, however.
It remains to be seen whether this is really 'controlled deflation' or the early stages of a runaway collapse. All of the triggers for financial meltdown mentioned in the article are quite plausible (with the possible exception of the asteroid strike). The swans are not as black as they once seemed.
"1. Startups today are generating real revenues off of a massive customer base (thanks to mobile and broadband saturation).
2. Startups with money in the bank or even — gasp! — profits, don’t go out of business! Founders are aware of this and are watching the deflation I mention above and, largely, taking measures to control their burn."
Both are laughable.
1. No, startups today can fund the ongoing chasing of customer counts through lavish spending of investors' money.
Earlier in the article a bullet point called out so darlings (Dropbox and Evernote IIRC) as facing an uncertain future in the face of an easily duplicated business model.
These 'massive' customer bases are as fickle or more fickle than in the past. Earlier today I read: 'no one under 19 uses Twitter.'
What was there massive customer base, again...?
2. Startups with profits go out of business when those profits evaporate because the flow of free investment money dries up for _their customers._
That's the thing I'm watching for in the immanent pop: the cascading crisis as each successive tier whose business models are predicated on the one before it, all falling like dominoes.
It doesn't matter how nimble you are, or how well managed, or ultimately, how well capitalized, if you business is selling to others in the same sector.
Failure goes viral, too.
8/10 for teeth-gritted sweaty-browed optimism, however.