4 ms·
Do you really think a VC is going to say "This small 3 person startup has a better profit model than that 'startup' with 10k people, hundreds of millions in rai
by lostcolony 5y ago
Do you really think a VC is going to say "This small 3 person startup has a better profit model than that 'startup' with 10k people, hundreds of millions in raised funds, that is still operating at a loss. I'm going to invest so heavily into them that they can operate at an equal loss with that big player, AND scale enough to catch up, and then it becomes who has the biggest war chest to burn to outlast the competitor, so that in the end their profit model can keep them afloat"?
- SpicyLemonZest 5y agoYes, this happens all the time. There are very few VC-funded startups that don't face VC-funded competition.
- lostcolony 5y agoThat wasn't my claim. My claim was that the thing the VCs are backing is not simply a better profit model. "You can do X for 10% less than the incumbent? Nothing else to distinguish you? And all we have to do is risk half a billion dollars over the next 5 years to compete on an even footing with what they've already spent?" - who is signing up for that?