Mark McQueen points to a story by Reuters columnist Eric Auchard which was generally about the up and down of the tech IPO market. Mark called out one chunk of the Eric’s story:
“There is now a noticeable dearth of entrepreneurs building companies with differentiated strategies and sustainable business models. Hot start-ups are now far more often built to be sold to established firms. And when good ideas emerge, VCs flood the market with a slew of copycats, making it hard for true pioneers to succeed.”
As the kids would say, Meh…
The “flood the market” comment is simplistic and fails to deal with reality. Lots of Facebook copycats, maybe. A bunch of YouTube knock offs, yup. A slew of Twitter wannabe companies, uh huh. In each of my (of the top) examples, the pioneers have and continue to succeed.
Eric’s comment with respect to big company buying up little company as a strategy, uh, yeah. The venture community invests dollars in an attempt to return more than what was invested. Selling to an established firm works for me (us) and should work for the entrepreneur as well if those first interests are aligned.
Gloom and Doom loves to look for scapegoats. Eric’s “it’s their fault” commentary fails to make the case in my view.
And well hey, if the copycats are doing it better than you, you might just want to team up with em.
Posted by: Keith Glover | May 08, 2009 at 04:27
I have never known a VC to invest in a pure copycat. We all know there is no technological real barrier to entry on the web. You can copy the business model, market strategy and more but there must be some element of a "better mousetrap". I guess this concept is foreign to the journalist world.
Posted by: online travel guide | May 31, 2009 at 08:24