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It would be hard to come up with definition of "operating at a loss to drive competition out" that applies to Uber but doesn't kill YCombinator and all other VC
by kjksf 9y ago
It would be hard to come up with definition of "operating at a loss to drive competition out" that applies to Uber but doesn't kill YCombinator and all other VC businesses.
Dropbox has competitors and for years operated at a loss thanks to investment from YC and other VC firms. So did Twitter, Airbnb and countless other.
If that was illegal, there would be no-one for VCs to invest and you wouldn't be here reading Hacker News, because this website would not exist.
- workthrowaway27 9y agoIt appears to be covered under antitrust laws and so is only applicable when the creation of a monopoly is likely, but there are situations in which it is illegal. See [1]. I disagree with your claim that there would be no one for VCs to invest in if the law were enforced more broadly/frequently. The important part is that the law isn't applicable to all unprofitable businesses. Only those that are unprofitable because they are pricing below cost. [1]: https://www.ftc.gov/tips-advice/competition-guidance/guide-antitrust-laws/single-firm-conduct/predatory-or-below-cost https://www.ftc.gov/tips-advice/competition-guidance/guide-a...
- IncRnd 9y agoYou're comparing apples and oranges. "Operating at a loss to drive competition out" is different from "operating at a loss".