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Digital advertising spend is projected to grow 25% this year to $191 billion, and Google (69%), Facebook (59%), Snapchat (116%) and Twitter (87%) all just reported rapid growth in their year over year advertising revenues. eCommerce for example grew 39% just last year - so there’s simply more demand. no surprise?—?that’s
It’s building a product that is substantially differentiated, and, as Bill Gross, one of the most prolific tech entrepreneurs of our era says, “ It needs to be 10x better than the competition ” (because if you shoot for that then in competitive markets you might achieve 3x.
It’s insanely competitive to get into our industry so most have degrees from institutions like Stanford, Harvard, Wharton and University of Chicago (blatant plug ;-). VCs, how to select a VC, etc.) and I realized that without years of experience it is tough to answer this question. Most VCs are book smart. FourSquare. Everywhere.
seed and they are writing $1.25m of it you can expect them to require a board seat) The competitive landscape (If you have several sources of capital you can likely politely decline the board request or can grant them a seat but ask for it to be “common appointed” and those revokable if you need in the future).
Valuing any company can be difficult because it requires a degree of forecasting future growth & competition and ultimately the profits of the organization. The Laws of Supply & Demand. The most basic chart of microeconomics is a supply & demand curve. Demand represents a buyer and supply a seller.
Most of the guidance you see for entrepreneurs is aimed at those who are selling a product (Apple, Tesla, Xiaomi), or selling a service (Uber, Airbnb, Snapchat). Announcing that you are a consultant, and hoping demand will set your focus, is not a good strategy. Shape your business by design, not by default.
Of course, growth is implied in that equation, and is also required for maintaining a sustainable competitive advantage. When their deep pockets went empty, Facebook stepped in, but demanded revenue from ads. But some of you will surely say “What about Facebook and Snapchat, who focused on growth first and are clearly successful?”
This market structure in which the few, large players use their market position to eliminate competition is inevitable. Our social graphs are locked in Facebook, Twitter and Snapchat. It’s Hobbesian economics 101. Distribution of media is tightly controlled by YouTube, Netflix, Facebook, Amazon and a handful of others.
Of course, growth is implied in that equation, and is also required for maintaining a sustainable competitive advantage. When their deep pockets went empty, Facebook stepped in, but demanded revenue from ads. But some of you will surely say “What about Facebook and Snapchat, who focused on growth first and are clearly successful?”
Of course, growth is implied in that equation, and is also required for maintaining a sustainable competitive advantage. When their deep pockets went empty, Facebook stepped in, but demanded revenue from ads. But some of you will surely say “What about Facebook and Snapchat, who focused on growth first and are clearly successful?”
I personally experienced the even more subversive side of DIGG when I learned that groups of people were actually demanding money to get stories on the DIGG homepage and I, the naive believer in online democracy and good intentions of people, learned about the black hat and gray hat monetization of the Internet.
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