Earlier quoted context omitted.
Sounds like a great business opportunity for a SaaS app that nails the details of nanny accounting in all fifty states.
No sh!t it is! If you can develop that for the tax codes in all 50 states, you'd have a winner! I think it's impossible to do though, unless you are Quicken.
Corporate America Hasn’t Been Disrupted
121–130 of 141 posts
Re: Corporate America Hasn’t Been Disrupted
#122Earlier quoted context omitted.
I'm 100% with you. When I left my job to do my startup to maintain my health plan at current levels was $1400 per month. That's $18,000 or so a year pre tax dollars. Basically the first $25,000 a year you pay yourself is going to just having healthcare! Assuming you want a decent plan. When we were 4 people all making just enough bootstrapping before we raised 35% of our costs went to healthcare. It was never raised…
I grew up with parents who worked in healthcare (my dad, specifically, has a ton of connections within the health and life insurance industry), I've sold health insurance, I now have a full-time job in a hospital system, and I'm working on launching a health insurance-related product (to augment Obamacare benefits for small businesses) and I can tell you, they didn't touch on many of the most important issues in the…
Yup. If you're young and fit, you don't need coverage for diabetes. A high deductible with a cancer/accident supplemental will be 30% the cost of a more normal plan.
Re: Corporate America Hasn’t Been Disrupted
#123I think there is a bit of cognitive dissonance in the tech community about "disruption" versus "big companies." Technology, in general, makes it easier to scale companies to large sizes, and "disruption" often involves using technology to enter an existing industry that is dominated by small, inefficient companies. A great example is Uber. Uber is making the taxi market a lot more efficient, but it's also well on the…
> Technology enables consolidation. I don't think that's quite right. Technology enables scale . That doesn't inherently mean consolidation. For example, you can imagine Uber as a decentralized or federated P2P free software app. It's essentially a market for rides. There is no inherent reason it has to work like Facebook rather than TCP/IP or DNS. Someone like FSF or Mozilla could build the technology and then the t…
Technology enables scale.
Technology may also reduce the need for scale. If you believe that Coase[1] was right about the "nature of the firm" vis-a-vis transaction costs[2] then it would follow that technology that can reduce transaction costs reduces the advantage of being big. And since there are innate downsides to size (people usually ignore this point), transaction-cost-reducing technology should generally work against bigger companies.
Is that happening? I don't know, I haven't really studied the issue, and I don't have enough data to say. But even if the argument leveled in this article is right (and I'm not sure it is), I'd be skeptical of the idea that it's technology which is driving a move towards bigger / older businesses.
Re: Corporate America Hasn’t Been Disrupted
#124I think there is a bit of cognitive dissonance in the tech community about "disruption" versus "big companies." Technology, in general, makes it easier to scale companies to large sizes, and "disruption" often involves using technology to enter an existing industry that is dominated by small, inefficient companies. A great example is Uber. Uber is making the taxi market a lot more efficient, but it's also well on the…
A new mom & pop coffee shop might easily out-compete the old mom & pop coffee shop across the street, but they can't offer the scale and uniformity of a Starbucks
And if they try, they had a bad strategy in the first place, and they deserve to fail. You don't compete against Starbucks on the basis of scale and uniformity. If you do it at all, you do it by offering a higher quality product (not an unreasonable proposition), or by offering greater customer intimacy (also not unreasonable) or maybe by achieving better operational efficiency and competing on price (this one seems like a stretch). But the point is, no one company can be "everything to everybody". Starbucks is vulnerable to competition from companies that follow a different value discipline, and that's why there are still local coffee shops, even where there are Starbucks stores.
When big corporations die, it's either because of their own mistakes, or some seismic market or technological shift (e.g. Kodak).
That's probably mostly true, but the big corporations don't have to die completely to allow smaller competitors to co-exist.
Re: Corporate America Hasn’t Been Disrupted
#125Earlier quoted context omitted.
Unfortunately, large companies can also much more easily engage in rent-seeking behaviour ( http://en.wikipedia.org/wiki/Rent-seeking ) which small competitors can't engage in effectively unless they organize as a group (effectively a small business union) Even worse, rent-seeking is often a better use of money than actually innovating in the market you supposedly compete in. If I can disadvantage all of my competito…
I've said this in other threads, but I think this angle is overstated by people who underestimate the purely business advantages that come with scale. Look at the tech industry, which historically hasn't had much involvement with regulation and thus little opportunity for regulatory capture. Is Apple using regulations to keep Jolla from succeeding? No. They use their scale to amortize their OS development work over t…
People want to believe that the free market means tons of little companies duking it out.
It would be interesting to create an actual free market and see what happens.
But the fact is that there are massive business advantages to being big, and the natural state of the market is in the direction of consolidation
Keep in mind that the entire notion of a shared stock, limited liability corporation is a legal fiction which exists due to the State. Now one can certainly argue about whether or not the world is a better or worse place with or without corporations, but in a strict sense, corporations are a violation of the idea of a free market. Since one of the main arguments for corporations it they make it easier for people to pool their capital and build large companies, I don't think it's a stretch to suggest that a corporation-free world would be closer to "tons of little companies duking it out".
Re: Corporate America Hasn’t Been Disrupted
#126I think there is a bit of cognitive dissonance in the tech community about "disruption" versus "big companies." Technology, in general, makes it easier to scale companies to large sizes, and "disruption" often involves using technology to enter an existing industry that is dominated by small, inefficient companies. A great example is Uber. Uber is making the taxi market a lot more efficient, but it's also well on the…
I only disagree with you statement that big companies are more efficient. Starbucks, maybe, but many other large companies are so horribly inefficient that it amazes me they not only survive, but thrive. Case in point, the large bank where I work: super slim margins, really inefficient operations, the whole nine yards. In my experience large corporations are mostly this way: lumbering giants.
Re: Corporate America Hasn’t Been Disrupted
#127Earlier quoted context omitted.
No sh!t it is! If you can develop that for the tax codes in all 50 states, you'd have a winner! I think it's impossible to do though, unless you are Quicken.
But you could get 2/3rds of the US population operating in just 15 states. 1/3rd in just 4 states.
1/3 of the population and likely 2/3 or 3/4 of the regulations. The big states have WAY more regulations than the smaller ones.
Re: Corporate America Hasn’t Been Disrupted
#128Earlier quoted context omitted.
I know i'm going to be slaughtered in downvotes, but have the top schools ever considered admitting more citizens?
My wife works in admissions at a top university... foreign students are extremely attractive them because they 1. Pay full tuition and 2. Have very high test scores.
Regarding 1, shouldn't it not matter to the university who is paying the cost of tuition as long as tuition is paid (i.e. loans are equivalent to a student personally bearing the burden)? Seems odd to favor foreign students for that reason.
Re: Corporate America Hasn’t Been Disrupted
#129Could other possible reasons be: 1) The companies innovating become large themselves and are now indistinguishable from the incumbents? 2) Silicon Valley is in a venture capital frenzy. VCs make money by exits. Innovative companies keep getting bought by the incumbents.
It's hard to overstate how important monetary policy is in this state of affairs. CapEx has been plummeting for years because it makes more sense to lever up with artificially cheap debt and gamble with equity. We see less upstarts and less major capital investment by businesses because that's way riskier than the guaranteed returns that can be got through other common schemes predicated on cheap money. http://davids…
Ding, we have a winner. The entire state of the economy is predicated on the effects tax policy has on where money is safest, and where money is least taxed, and of course the money goes where the optimal returns for the lowest risk are.
And those are not in entrepreneurship.
Re: Corporate America Hasn’t Been Disrupted
#130I think the author of the article went looking for stats to support a title. Corporate America has been disrupted however I think this article was looking for financial failure versus adapting to the market pressures. The corporations below have faced massive disruption: Kodak, HP, GM, Ford, JC Penney, Sears, McDonalds, Radio Shack, Circuit City, Best Buy, Borders, Barnes&Noble, IBM, Microsoft, Xerox, and Target have…
Who disrupted McDonalds?
A lot of his citations are of systemic disruption - in the case of McDonalds, it was disrupted because people stopped taking their diet for granted, and McD's got called out on their atrocious menu.