Young firms, old capital
sciencedirect.com
sciencedirect.com
We should make sure there are stronger antitrust, anti-monopoly laws and judgments so that startups and newcomers can thin the herd. It should be easy to tear into 20 year old markets, not impossible.
The business world needs continual new blood.
Hulking old giants like Oracle and IBM should be picked off. The other aging giants - Apple, Google, Meta - ought to be seeing signs of sluggishness and an inability to capture new markets. Something's wrong when these old giants can use their former advantages to hold new markets captive and hostage.
Tech doesn't need Proctor and Gamble equivalents. It needs 2008 Googles.
Every generation of new blood should overtake the old lazy incumbents. Young predators and forest fires alike are healthy for the ecosystem.
Then tech is going to have to come up with something as revolutionary as broadband internet and broadband mobile internet. You need a new “space” for new players to out compete new ones in where everyone is starting at or near zero.
Microsoft had computers that had become vastly cheaper, Google/Facebook had ubiquitous broadband internet, and Apple had ubiquitous mobile broadband internet plus battery/mobile processor innovations.
Old companies that are still super lean and efficiently serve a difficult need. Young companies that thin the herd and pick up the old companies that got fat.
Fundamentally, an economy without bankruptcies of old companies is doomed.
"Oxygenate the market" is the phrasing Scott Galloway now uses.
Marketing matters; sell the sizzle, not the steak.
Everyone wants to hear about new businesses, entrepreneurs, job growth, family businesses, Main St, yadda yadda.
It's just a weird coincidence that policies promoting young and small businesses disadvantage corporations and investors hoarding wealth. (wink)
Keep preaching. There are dozens of us who agree with you.
> To document the interaction between firm and machine age, we lean on 1.56 million transactions covering 70,000 models of machines. Across a wide range of industries and equipment types, young firms acquire older capital, whereas older firms are more likely to buy new capital
This seems to line up with what I've heard from friends in biotech and mechanical companies. One friend lamented that "at Apple, we had the best of everything: suppliers, equipment, machinery. Here, we make do with what we've got and find creative ways to work with them." Similarly, on the YC forums, we often see used lab equipment listed for sale, and there are whole industries around this.
Pretty neat! Definitely a part of the startup or industry network effect I haven't thought of before. I wonder what other examples of startups working with super-janky second-hand machinery are out there.
Side note: He did say not all of his sources of chairs are businesses going out of business. Some are just moving from one office to another. The companies find it easier to design new locations with entirely new furniture, sell him everything from the old location (probably also use the opportunity to shrink each individual workspaces)