What seems like a side story is actually, I think, quite indicative.
Tinder isn't a real startup, but a manufactured success for a couple of well-connected douchebags (who behave as if they're above the law). It's the Disneypreneur phenomenon (http://michaelochurch.wordpress.com/2014/06/09/silicon-valle...). If you look into it, both of these guys are invaders from the MBA culture.
These phony startups, that are actually pre-arranged by powerful players in the mainstream corporate/McKinsey world, are becoming a lot more common and they're often difficult for genuine, old-style startups to compete with. (They blow up big, suck up a lot of talent and attention, then fail and lose credibility, so their inferior capability still leads to a both-lose outcome.)
This is going to blow up big in a couple of years: this massive proliferation of propped-up junk businesses and pseudo-startups run by incompetents. We're already seeing the embarrassing-but-not-yet-devastating fuckups. We haven't seen an Enron yet. But that's going to come, and it's going to have massive effects (and probably negative ones, on good and bad players) on the startup scene.
Evan Spiegel should have been fired after the frat emails surfaced. As for Clinkle, that's been around for years and hasn't produced jack shit because it's not even a real company-- just a scam.
However, I'd say that all these examples basically disprove your theory about them making it harder for "real" startups to compete. Webvan flamed out miserably, but that didn't stop Peapod (and now Instacart, Google Shopping Express, and Amazon Prime) from taking off. SnapChat didn't exactly hurt WhatsApp's chances. Cuil has had a negligible impact on DuckDuckGo - it just flamed out, pivoted beyond recognition, died, and the founder went back to her job at Google. Digg's death throes proved a huge boon for Reddit, and their audience started increasing massively.
As a startup founder, you are best off just ignoring the well-funded competitor who's doing everything wrong. Let them pave the path, legitimize the marketplace, pump millions of dollars in ad spending into the noosphere - and then quietly save your cash, talk to real customers, build the product that people actually want, and provide a breath of fresh air for the people that were burned by your celebrity dunce competitor.
Comments
What seems like a side story is actually, I think, quite indicative.
Tinder isn't a real startup, but a manufactured success for a couple of well-connected douchebags (who behave as if they're above the law). It's the Disneypreneur phenomenon (http://michaelochurch.wordpress.com/2014/06/09/silicon-valle...). If you look into it, both of these guys are invaders from the MBA culture.
These phony startups, that are actually pre-arranged by powerful players in the mainstream corporate/McKinsey world, are becoming a lot more common and they're often difficult for genuine, old-style startups to compete with. (They blow up big, suck up a lot of talent and attention, then fail and lose credibility, so their inferior capability still leads to a both-lose outcome.)
This is going to blow up big in a couple of years: this massive proliferation of propped-up junk businesses and pseudo-startups run by incompetents. We're already seeing the embarrassing-but-not-yet-devastating fuckups. We haven't seen an Enron yet. But that's going to come, and it's going to have massive effects (and probably negative ones, on good and bad players) on the startup scene.
Can you provide other examples of this phenomenon?
Snapchat and Clinkle.
Evan Spiegel should have been fired after the frat emails surfaced. As for Clinkle, that's been around for years and hasn't produced jack shit because it's not even a real company-- just a scam.
Also Xobni, Webvan, Color, Cuil, Digg.
However, I'd say that all these examples basically disprove your theory about them making it harder for "real" startups to compete. Webvan flamed out miserably, but that didn't stop Peapod (and now Instacart, Google Shopping Express, and Amazon Prime) from taking off. SnapChat didn't exactly hurt WhatsApp's chances. Cuil has had a negligible impact on DuckDuckGo - it just flamed out, pivoted beyond recognition, died, and the founder went back to her job at Google. Digg's death throes proved a huge boon for Reddit, and their audience started increasing massively.
As a startup founder, you are best off just ignoring the well-funded competitor who's doing everything wrong. Let them pave the path, legitimize the marketplace, pump millions of dollars in ad spending into the noosphere - and then quietly save your cash, talk to real customers, build the product that people actually want, and provide a breath of fresh air for the people that were burned by your celebrity dunce competitor.
Who is Snapchat owned by?