“Many businesses gain only limited advantages as they grow to large scale.
Service businesses especially are difficult to make monopolies.
If you own a yoga studio, for example, you’ll only be able to serve a certain number of customers.
You can hire more instructors and expand to more locations, but your margins will remain fairly low and you’ll never reach a point where a core group of talented people can provide something of value to millions of separate clients, as software engineers are able to do.”
➡️ Taken from Peter Thiel’s Zero to One
In this article, I try to disprove Thiel’s claim, providing a number of companies that are services businesses and have scaled through digitization successfully let alone have become monopolies despite inherently being service businesses. I elaborate on how these companies reinvented their business models and became successful while also sharing what they could have done better and some potential risks looming large in the future. I also demonstrate how these exceptional companies destroyed established trends and biases.
Tag Archives: Technology
What to (and not to) make of Startups: Introducing additional well-known secrets of venture capital and start-ups
On the 9th of March, 2022 I shared a post on some well-known secrets within the venture capital:
https://bit.ly/3wEc80F
On the 15th of March, 2022, Bloomberg LP published the following:
Homebuying Startup Knock Scraps Plans to Go Public, Lays Off Half Its Staff
· Housing-tech firm instead raises $70 million in private round
· CEO says collapse of Zillow iBuying business spooked investors
“The business is doing great, but we built to be a public company, and there’s no IPO market right now,” Black said. “It does feel like money has gotten very scarce and very expensive.”
Link to the article: https://bloom.bg/3qG0D4O
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Is your start-up ready for the many challenges ahead?
How can you make your start-up more resilient against unexpected circumstances?
Analysts, VCs, underwriters, or even your finance department, may assess a value for your company. Is it reliable?
I will try to answer these questions in this article. Also, we will take a quick look at what happened to Knock.
If only you had known these before investing in a tech venture (or any private company): Some well-known secrets ;) Part 1 of many
If only you had known these before investing in a tech venture (or any private company)
Some well-known secrets 😉
#1
Tendency to stay private as long as possible not necessarily results from the motivation of glossing over “subpar execution” and “problems concerning financial viability of founders’ business model” although there are many cases in which these have been the real motivations of staying private. It has been driven mainly by excessive private capital, albeit currently drying up, incentivized by supplying easy, i.e. not smart, liquidity so that valuations shoot up before IPOs, which have become just down rounds recently.
So, now you know why many ventures are waiting for a decade or more on average before going public.