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This is exactly right - the two categories of businesses that will face hardships are: - Consumer tech startups that have only produced revenue-free growth (ex
by w1ntermute 11y ago
This is exactly right - the two categories of businesses that will face hardships are:
- Consumer tech startups that have only produced revenue-free growth (ex: Dropbox and Evernote)
- Startups selling to startups (ex: Mixpanel and Stripe, maybe Zenefits)
On the other hand, a company like Airbnb may benefit from a downturn, as people look to save money on travel.
- elevensies 11y agoAs a subset of the 2nd category, I think ad-supported mobile apps are going to suffer, i.e. games, since most of them seem to be advertising for each other.
- interesting_att 11y agoI would actually disagree. eCPMs on mobile have steadily been going up, but not because game companies have been spending unsustainably. eCPMs have increased because brands have slowly been moving in, there is better adtech/targeting, and because game companies have a higher LTV, hence can spend more. Many US-based mobile game companies have basically given up fundraising from VCs as a significant part of their strategy, because it became too difficult to do so post-Zynga's crash. Point is: If you're a ad-supported mobile app, can purchase users at an ROI+ rate, and know how to iterate productively, it sounds like you have weathered the storm. Mobile ad-supported companies will stay around (though they may trim workforces to ensure long-term viability).
- digbyloftus 11y agoIs Dropbox really consumer tech? I would have thought businesses would make up the vast majority of their revenue.
- wyclif 11y agoDropbox is a hybrid, both B2B and B2C.
- w1ntermute 11y agoYes, that's exactly their problem - they're consumer tech, yet businesses make up the vast majority of their (supposedly meager given their insanely high valuation) revenue.