81–90 of 224 posts
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Maybe but here on the Internet there seems to be one search engine which rakes in most of the money, one social network where most people have accounts, one electronic toy maker which sits on top of a mountain on cash. Second prize is a set of steak knives.
Is that top search engine Baidu? Yandex? Google? Depends on who and where you ask.
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The "Zero to One" wisdom is that lots of competition means low margins for the business. It's very difficult to afford much more than minimum wages for your sandwich shop employees. That's part of why you don't see a lot of venture-funded restaurants.
Actually, in the UK at least there are VC firms which invest solely in retail and food businesses. Usually they take an already existing restaurant with a single location and turn it into a chain. It is possible to create scalable value in the retail and restaurant businesses, mainly due to the power of brand recognition.
People know how KFC is different from McDonalds is different from Pizza Hut is different from Chipotle. Hell, most of the time they even know how Burger King is different from McDonalds (white meat chicken tenders and more meat in the burgers), how In'N'Out is different from McD's (simple menu, Thousand Island dressing, onion rings), and how Chick'Fil'A is different from KFC (sandwiches over buckets; Chick'Fil'A sauce; lighter frying). The extent to which these are viable as VC-backed chains is exactly the extent to which they can be differentiated in customer's minds.
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Maybe but here on the Internet there seems to be one search engine which rakes in most of the money, one social network where most people have accounts, one electronic toy maker which sits on top of a mountain on cash. Second prize is a set of steak knives.
Google, Facebook and Apple are all increasingly hated though, and can't figure out new ways to make money. The time may be coming where taking a shot at their profitable businesses becomes a possibility.
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Let's try it another way, "there can be more than one sandwich shop"
Obviously. With sandwich shops, location is a key differentiator. We are X for Y, where X is the sandwich shop and Y is specific location. Sandwich shops is also a highly competitive market. As such, when you look at a snapshot in time it seems like there is diversity without strong differentiation. However, in most cases, if you look at it historically you’ll see that differentiation at inception was required. Fun n…
This grab for the #1 slot analysis robs the richness of expression that businesses provide.
The trophy model implicates that everyone but a single group walks away losers. It's not a necessary model or, in my opinion, a healthy encouraging analysis. We are the most social species to ever exist, something that requires ruthless cutthroat individualistic competition leaves out the vast majority of humans who aren't like that.
In some markers, the players try to stomp on each other's heads acting like tyrants while in others they coexist peacefully. Not everyone is always trying to be a dick.
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I just tell people that my neighborhood also has multiple grocery stores
But I’m guessing you probably tend to favor one for your regular shopping because it has characteristics you like better than the others.
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A more direct question would be "Why should a potential customer choose you over $established_competitor_x?" If your best answer is "We are adding diversity to the marketplace", then you're probably doomed. If you aren't better in some way (faster, cheaper, better tech, etc...) then people are going to naturally gravitate towards the incumbent who has already shown some staying power and has infrastructure in place t…
>If your best answer is "We are adding diversity to the marketplace", then you're probably doomed. If you aren't better in some way (faster, cheaper, better tech, etc...) We have seen it over and over in tech though...some small time founder starts something and then a VC back startup eats their lunch and takes the market (of course rewriting history along the way to say they invented/disrupted the market). The sad t…
I searched a startup name in a seperate tab, came back and had an inescapable subscribe screen. If your going to attempt to hold the rest of the article hostage pending a subscription to your newsletter, at least let me get interested first. This is both hostile and ineffective- and unsurprisingly is the most amusing part of the website
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Maybe not an opportunity for consoles per se (see cheeto comment), but maybe an opportunity for renting games from your neighbors. Heck, I could see this being extended online in quite a unique way. Cheaper renting some movie or game from someone who already owns it...
Except that nobody owns games or movies anymore. I suspect that letting someone log on to my Steam account would potentially be grounds for a banning, and losing whatever investment I have in the platform.
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You wouldn't want to invest in a sandwich shop, and the reason is precisely why investors ask about differentiation.
Knowing Subway's market cap now, would you invest in them as an angel investor? You'd be a billionaire right now. They didn't become big by differentiating product. Their sandwiches aren't that special. They became big by coming into existence where people wanted sandwiches.
https://news.ycombinator.com/item?id=21465969
They absolutely did become big by differentiating product. There's a Jersey Mike's and an Arby's near my home, as well as a Subway about a mile away. The former two chains came into existence right around the same time (and slightly before) Subway did. They struggle for business, both nationwide and locally. It wouldn't surprise me if most readers of this comment haven't heard of them, while most everyone has heard of Subway. That's despite having a similar product (sandwiches) and similar locations to Subway.
What they're missing is the brand. Subway pushed heavily on being a healthy, quick-service chain with good selection in the late 90s, right as America was waking up to the virtues of healthy food and wanting something different from burgers. (They'd actually been around since the 60s, but I never heard about them until the early 2000s.) Nobody buys a Subway for the sandwich; they buy a subway because they want something quick & easy, from a known source, and don't feel like getting a burger. There are plenty of other sandwich shops that sell sandwiches cheaper, oftentimes with better ingredients (i.e. not 49% soy protein in their chicken), but you'll never have heard of them, and most close up in a few years. Invest in them and you go broke.
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Is that top search engine Baidu? Yandex? Google? Depends on who and where you ask.
Yandex has about ~1.5% revenues of Google. Baidu ~11%. It's not even a contest which rakes in the most money.
Seriously, if I could pay talented people many hundreds of thousands of dollars, have a nice office, happy customers, a decent product, and only make a paltry 136 million a year, where do I sign up?!