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You're missing opportunity cost in your calculations. That is significantly different for Google vs a startup vs a small business. It isn't enough to make "so
by bcrosby95 7y ago
You're missing opportunity cost in your calculations. That is significantly different for Google vs a startup vs a small business. It isn't enough to make "some profit" in a mega corporation. The profit compared to the resources invested has to be of a similar magnitude to their primary business, or else they're wasting resources. Things are axed all the time for not being profitable enough.
- crazygringo 7y agoBut the same is absolutely true for VC. They're not looking for 2x returns, they're looking for 10x returns. And VC-funded startups are the right comparison to make here. Are they any less ruthless about pulling the plug on something that can't show any probable path to required growth? (I think it goes without saying that neither Google nor VC's are trying to fund lifestyle businesses, the way a mom-and-pop bootstrapped startup might be.)