Mark Suster, the prominent VC writes a highly supported (by Brad Feld, Fred Wilson etc.) article about the current status of his industry.
During their lost decade —since the 2001 bubble— they have realized startups need significantly less investment than before. That’s right, this is the 37 Signal way with no investment at all.
Since there is no need anymore for money to start up many investors will close their business. For the others there is one card left: scalability.
They think a business to become mature, to serve millions needs heavy investment. They only forget 37 Signals has over 3 million customers paying an average $50 monthly fee without any investment, with less than 20 employees and no offices at all.
Don’t repeat yourself and Less is more — staying lean — are amongst the basic principles of scalability.
Their only hope, the Fat model resembles ironically Clay Shirky’s, their mentors principle:
“Institutions will try to preserve the problem to which they are the solution.”
The complete article is at http://metaman.tumblr.com/post/819220481/the-current-state-o...