4 ms·

I think he says it right there "In short, if somebody successfully inserts themselves between you and your customer, they can exercise tremendous control over y

I think he says it right there "In short, if somebody successfully inserts themselves between you and your customer, they can exercise tremendous control over you, including taking a big chunk of your profits or outright killing you." Read "you" as "large incumbent" and "somebody" as the small scale entrepreneur.

petra 8y ago
OK, but how ? how does a small scale entrepreneur with few resources manages to achieve such difficult feat ?
- Ibethewalrus 8y ago
  You innovate. You deliver a similar solution in a simpler “good enough” way (rebar). Or solve something cumbersome (stripe), or create new markets (invision, Netflix)
  - petra 8y ago
    Stripe raised $245M. Netflix raised 3.1B. invision too raised significant funds. and rebar isn't about a demand side business, it's a better supply side business.
    - awad 8y ago
      The ultimate trade-off made between self-funding and raising outside capital is how much you can invest in growth at an accelerated rate. Unless you have a pre-existing brand you can tap into (like Kyle with her cosmetics or Clooney with his Tequila), it's nearly impossible...though some companies have done it. But, even with outside funding, outsized success is still rather difficult to achieve, so it's a matter of personal preference what route you go down at the end of the day.
    - Ibethewalrus 8y ago
      Check Basecamp’s Bootstrapped Profitable & Proud
- Altimor 8y ago
  Author of the post here — I agree that the "how" might be what's missing the most. The point I'm trying to make with the post is really more of a "what" question. I sometimes talk to entrepreneurs who want to outsource their distribution through some creative channels. I'm arguing that one should fight as hard as they can to keep owning that relationship with the end customer, and that this may indeed be close to the only thing that matters in the whole chain. That also explains why startups that have "just" a bunch of users, and no revenue, are still able to raise at massive valuations. Sure the proximate cause is that they'll be able to monetize that attention at some point — but the deeper insight is that attention is inherently valuable, because it's upstream of everything. Every transaction starts with a person paying attention to something.

petra 8y ago

OK, but how ? how does a small scale entrepreneur with few resources manages to achieve such difficult feat ?

Ibethewalrus 8y ago
You innovate. You deliver a similar solution in a simpler “good enough” way (rebar). Or solve something cumbersome (stripe), or create new markets (invision, Netflix)
- petra 8y ago
  Stripe raised $245M. Netflix raised 3.1B. invision too raised significant funds. and rebar isn't about a demand side business, it's a better supply side business.
  - awad 8y ago
    The ultimate trade-off made between self-funding and raising outside capital is how much you can invest in growth at an accelerated rate. Unless you have a pre-existing brand you can tap into (like Kyle with her cosmetics or Clooney with his Tequila), it's nearly impossible...though some companies have done it. But, even with outside funding, outsized success is still rather difficult to achieve, so it's a matter of personal preference what route you go down at the end of the day.
  - Ibethewalrus 8y ago
    Check Basecamp’s Bootstrapped Profitable & Proud
Altimor 8y ago
Author of the post here — I agree that the "how" might be what's missing the most. The point I'm trying to make with the post is really more of a "what" question. I sometimes talk to entrepreneurs who want to outsource their distribution through some creative channels. I'm arguing that one should fight as hard as they can to keep owning that relationship with the end customer, and that this may indeed be close to the only thing that matters in the whole chain. That also explains why startups that have "just" a bunch of users, and no revenue, are still able to raise at massive valuations. Sure the proximate cause is that they'll be able to monetize that attention at some point — but the deeper insight is that attention is inherently valuable, because it's upstream of everything. Every transaction starts with a person paying attention to something.