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> A high value service realizing it delivers more value than it initially thought, and raising prices... is not a monopoly. That's just business, life, etc. It
by jorvi 5y ago
> A high value service realizing it delivers more value than it initially thought, and raising prices... is not a monopoly. That's just business, life, etc.
It is not a monopoly, but it is a sign of an unhealthy market.
A simple example: say we have company QualityEars. QualityEars sells budgetBoom ($25), performanceBoom ($60), and premiumBoom ($100) speakers. However, their performanceBoom is so well-engineered, that it performs more like an $90 speaker and thus nearly invalidates the premiumBoom line.
In a healthy market, this now forces QualityEars’ competitors to create an equally valuable product, and QualtiyEars itself to increase the price-performance ratio of its premiumBoom and perhaps even budgetBoom line.
Instead, what I’ve mostly seen happen in the real world (whether it is products or services) is either the price of the performanceBoom and premiumBoom line get raises, or performanceBoom gets discontinued and worsevalueBoom takes its place.
This is a sign of not enough competition. Also known as an unhealthy market :)
- ianbutler 5y agoWait what? This arguably can be seen as adding more value for entrepreneurs, while edging out angel investors. It only becomes potentially onerous depending on the terms of the seed or later round, but the 500k means two people could go for a very long time without that second round and definitely without taking 50-100k checks from a couple of angels. If anything these terms are more competitive because the market is very competitive for startup funding and had to become at least seemingly more founder friendly. I recently put together an investor list because I'm building something that may see early stage funds as a target customer and I put together more than 100 early stage firms in about an hour of searching and that barely scratches the surface. You definitely don't need YC to get funding and if you have the right connections it may behoove you not to if you don't like YC's terms. YC is so far from the only game in town. The market is quite healthy.
- jorvi 5y agoI was responding more in a general sense. If a company realizes that whatever it is delivering is worth more than they are currently asking, in a healthy market their competitors would be forced to match that value. In an unhealthy market, the value just gets lowered (either by lowering the value offered or by raising the price), either of which bones customers.