Its interesting that Rosenberg focuses on the self-funded model only for what he calls "ecosystem" startups. I disagree that the issue is risk in that way that

Its interesting that Rosenberg focuses on the self-funded model only for what he calls "ecosystem" startups. I disagree that the issue is risk in that way that he describes -- i.e. that Facebook or Apple could theoretically crush these companies quickly. Instead, I think the issue is more that the platform itself is unstable. Particularly with a limited platform like Facebook, nobody really knows if these apps will be profitable in 5 years, and even then, what the growth of an "app within an app" will be. Since VC's are generally interested in the big payouts, it always seemed to me like funding Facebook app companies was largely outside the VC domain. That said, I generally agree with the big picture about self-funding -- its pretty much in line with what PG said in the recent essay about VCs in this recession.