4 ms·
> Half of the world's population still isn't online so there's plenty of room for growth in the future too. The offline half doesn’t have that much money to sp
by disishhsha 8y ago
> Half of the world's population still isn't online so there's plenty of room for growth in the future too.
The offline half doesn’t have that much money to spend, right? Making some assumptions and approximating, would it be wrong to say that potential gains from bringing new people online ≈ global GDP growth? Currently that’s in the low single digits.
- panarky 8y agoThis is the premise of The Innovator's Dilemma. Incumbents ignore low-margin, cost-conscious customers. Innovators cater to customers the incumbents don't want and build a product that is worse than incumbent's in every area except cost. Then innovators improve the product to capture the lower tier of incumbent's customer base, then work their way up to more profitable customers. Incumbent wakes up too late, finds their customers moved to a product the incumbent always thought was worse. Lesson: don't ignore large, underserved populations or you'll find your lunch has been eaten. https://en.wikipedia.org/wiki/The_Innovator%27s_Dilemma https://en.wikipedia.org/wiki/The_Innovator%27s_Dilemma
- manigandham 8y agoLow single digits is fine when you're among the biggest companies on the planet. We're talking about 10s of billions in profit. Amazon is now getting into the space and is a strong contender to become #3 biggest player.
- village-idiot 8y agoSize is not insurance against failure. Go ask Novell.
- manigandham 8y agoNobody is claiming that it is. The point is that single-digit growth is fine when you're big because they are percentages. The 1000% growth when you're a startup does not exist when you're worth half a trillion.
- village-idiot 8y agoTrue, it just depends how fast your next competitor is growing.
- disishhsha 8y agoLow single digit growth does not justify a high PE ratio.