more thoughts on VC/startups
Recently I commented here on a post @ bubblegeneration that the true value of a startup is shifting primarily to ideas/innovation etc (as opposed to the more traditional value driver being execution). Today I noticed a post by Xavier Casanova along similar lines:

Starting a new business is a lot easier now than back in 1998 ... the cost of doing business is nowhere near what it used to be. ... Entrepreneurs are the big winners here, since they need less capital to get off the ground.

You still need talented people to execute (and the compensation they require) but as the connectivity provided by the internet makes coordination (and thus outsourcing) significantly cheaper, the ideas will increasingly become the primary reason a company succeeds.


An example: How many web 2.0 apps/platforms have you stumbled across, thought, "this is pretty cool", and never thought of them again? I mean, I use del.icio.us all the time, but that and maybe occasionally one or two others is about the extent of it. I think this points toward commoditization - so many startups have the resources to create something and make it work, but the ones that see use are the ones that are innovative from a functionality/usability perspective (and, yes, reviving old concepts can be innovative if done well). Of course I'm neglecting a discussion of switching costs here, but I don't think that changes the validity of my point.

Can execution be innovative? Do startups need both innovative concepts/ideas as well as innovative execution to succeed in this market?
- posted by vcmc @  2/13/2006 12:14:00 PM