9 ms·

From first-hand experience, however, bootstrapped companies often don't have a ton of cash in the bank. They can quickly fail if there's an adverse event (COVID

From first-hand experience, however, bootstrapped companies often don't have a ton of cash in the bank. They can quickly fail if there's an adverse event (COVID, for example). You can also get crushed by well-funded competitors who can innovate faster than you due to larger team sizes, salaries, etc.

rusticpenn 6y ago
It depends on the type of company. Its hard to out-innovate some companies just by throwing more money.
Justsignedup 6y ago
The best small companies operate in their direct competitor's blindspot. Stupid example: Tesla. Toyota reverse engineered their car. Can't make a competing product. Not because it is impossible, but because it is not how the entire supply chain / development is set up. It'd take Toyota a major restructuring of the company to be able to compete. That's the idea. It doesn't matter how much cash the other side throws at you, you're working where they can't go. Time and time again I see our company out-maneuvering our competitors with less money. Not because we got some super geniuses on the team (okay we got some smart people), but because we started from the ground up working in a spot where our competitor could not go. And so we have years of experience more than our competitor in the thing that our competitor needs to get better at.
- est31 6y ago
  In real electric car markets, other brands than Tesla run the show. In Norway, one of the biggest western electric car markets, Tesla is way at the bottom of sales. Only 95 Teslas were sold in November, while single models of other manufacturers had multitudes of that number in sales. https://insideevs.com/news/452441/norway-plugin-car-sales-october-2020/ https://insideevs.com/news/452441/norway-plugin-car-sales-oc... I think Tesla's main contribution lies in the past, by being an early pioneer of EVs and pushing them in an environment where nobody considered EVs viable. This definitely deserves an entry in the history books. But competitors have waken up.
  - sharpneli 6y ago
    One can perhaps think of this as Teslas blind spot. People living with California wages don’t necessarily see the difference in prices mattering that much.
    - theptip 6y ago
      This is not a blind spot, it's explicitly part of their company's long-term strategy; Musk's plan from the beginning was to start with a luxury-tier offering (Roadster), and gradually work their way down the price-points as they achieved greater economies of scale. Musk wrote about this way back in the day (2006): https://www.tesla.com/blog/secret-tesla-motors-master-plan-just-between-you-and-me https://www.tesla.com/blog/secret-tesla-motors-master-plan-j... > Almost any new technology initially has high unit cost before it can be optimized and this is no less true for electric cars. The strategy of Tesla is to enter at the high end of the market, where customers are prepared to pay a premium, and then drive down market as fast as possible to higher unit volume and lower prices with each successive model. You might criticize their execution for failing to reach the mass-market sedan price-point fast enough (though I think that they have done an impressive job of starting a car company from scratch), but I don't think the "blind spot" claim really holds water.
      - sharpneli 6y ago
        Good point. So they simply were not able to ramp up faster than it took for the existing manufacturers to start catching up and leveraging their scale better.
        omgwtfbyobbq 6y ago
        They seem to be ramping faster than anyone else. https://electrek.co/2020/10/30/tesla-tsla-market-share-global-ev-sales-change/ https://electrek.co/2020/10/30/tesla-tsla-market-share-globa... However they are not selling more EVs than everyone else in every market, which isn't a bad thing IMO. A smaller piece of a bigger pie is what they seem to be shooting for.
        6y ago
tomc1985 6y ago
> You can also get crushed by well-funded competitors who can innovate faster than you due to larger team sizes, salaries, etc. Which is why VCs are evil and need to be crushed. Ironic, I know, posting this here
- dumbfoundded 6y ago
  VCs are a slightly less evil version of PE IMO. Don't get me wrong, they're still evil. Anyone who makes money from money should really question their place in the world.
  - daniel-cussen 6y ago
    That's literally the biblical interpretation on this.
    - dumbfoundded 6y ago
      Usury laws in religion have different forms. Limiting doesn't mean no finance, it just prevents some of the crazy abuse we see now.

rusticpenn 6y ago

It depends on the type of company. Its hard to out-innovate some companies just by throwing more money.

Justsignedup 6y ago

The best small companies operate in their direct competitor's blindspot. Stupid example: Tesla. Toyota reverse engineered their car. Can't make a competing product. Not because it is impossible, but because it is not how the entire supply chain / development is set up. It'd take Toyota a major restructuring of the company to be able to compete. That's the idea. It doesn't matter how much cash the other side throws at you, you're working where they can't go. Time and time again I see our company out-maneuvering our competitors with less money. Not because we got some super geniuses on the team (okay we got some smart people), but because we started from the ground up working in a spot where our competitor could not go. And so we have years of experience more than our competitor in the thing that our competitor needs to get better at.

est31 6y ago
In real electric car markets, other brands than Tesla run the show. In Norway, one of the biggest western electric car markets, Tesla is way at the bottom of sales. Only 95 Teslas were sold in November, while single models of other manufacturers had multitudes of that number in sales. https://insideevs.com/news/452441/norway-plugin-car-sales-october-2020/ https://insideevs.com/news/452441/norway-plugin-car-sales-oc... I think Tesla's main contribution lies in the past, by being an early pioneer of EVs and pushing them in an environment where nobody considered EVs viable. This definitely deserves an entry in the history books. But competitors have waken up.
- sharpneli 6y ago
  One can perhaps think of this as Teslas blind spot. People living with California wages don’t necessarily see the difference in prices mattering that much.
  - theptip 6y ago
    This is not a blind spot, it's explicitly part of their company's long-term strategy; Musk's plan from the beginning was to start with a luxury-tier offering (Roadster), and gradually work their way down the price-points as they achieved greater economies of scale. Musk wrote about this way back in the day (2006): https://www.tesla.com/blog/secret-tesla-motors-master-plan-just-between-you-and-me https://www.tesla.com/blog/secret-tesla-motors-master-plan-j... > Almost any new technology initially has high unit cost before it can be optimized and this is no less true for electric cars. The strategy of Tesla is to enter at the high end of the market, where customers are prepared to pay a premium, and then drive down market as fast as possible to higher unit volume and lower prices with each successive model. You might criticize their execution for failing to reach the mass-market sedan price-point fast enough (though I think that they have done an impressive job of starting a car company from scratch), but I don't think the "blind spot" claim really holds water.
    - sharpneli 6y ago
      Good point. So they simply were not able to ramp up faster than it took for the existing manufacturers to start catching up and leveraging their scale better.
      - omgwtfbyobbq 6y ago
        They seem to be ramping faster than anyone else. https://electrek.co/2020/10/30/tesla-tsla-market-share-global-ev-sales-change/ https://electrek.co/2020/10/30/tesla-tsla-market-share-globa... However they are not selling more EVs than everyone else in every market, which isn't a bad thing IMO. A smaller piece of a bigger pie is what they seem to be shooting for.
      - 6y ago

tomc1985 6y ago

> You can also get crushed by well-funded competitors who can innovate faster than you due to larger team sizes, salaries, etc. Which is why VCs are evil and need to be crushed. Ironic, I know, posting this here

dumbfoundded 6y ago
VCs are a slightly less evil version of PE IMO. Don't get me wrong, they're still evil. Anyone who makes money from money should really question their place in the world.
- daniel-cussen 6y ago
  That's literally the biblical interpretation on this.
  - dumbfoundded 6y ago
    Usury laws in religion have different forms. Limiting doesn't mean no finance, it just prevents some of the crazy abuse we see now.