Good Or Bad…?
The Onion recently released an article titled “My Advice To Anyone Starting A Business Is To Remember That Someday I Will Crush You” penned from the perspective of Jeff Bezos. Really, should you even try starting a business if one of the big dogs will just copy your idea and run your business into the ground? Is your hard work, blood, sweat and tears, really worth it to just have it snatched from you? These questions are coming at a time where many are feeling the “start up boom” is over. No longer is it “cool” to create an app, but it’s actually tough to do, and while the “American Dream” of running your own company and making billions is awesome. Reality may not be so friendly.
Now, we aren’t saying don’t follow your dreams and passions, but we’re definitely saying think twice and really ask yourself if this is the life you want and if the product or business you’re creating is something you believe in. Excessive money and fame alone aren’t enough to warrant the grueling work and fame especially is hard to attain and not really important anyway. Over the past several years, tech giants like Facebook, Amazon, Microsoft, Google and Apple have become so ubiquitous they can just turn on a button and immediately release a feature or product that stifles any and all competition.
Take, for example, Google & Facebook who account for over 98 percent of growth in digital advertising in the last year. Amazon has a 74 percent share in the e-book market and Apple owns almost half of the smartphone market in the US. The market cap of all these tech giants is higher than the GDP of most large US cities. So these monopolies definitely exist. And they can indeed hurt entrepreneurs. For example, Snapchat who are “successful” by all intents and purposes, can’t seem to catch a break, mainly from Facebook jacking all of their features. Even as they seek to enter hardware and augmented reality, companies like Amazon, Microsoft, and Apple are right there to eat their lunch. How can an entrepreneur compete?
As an entrepreneur, it makes you wonder if you should even start a business knowing there’s a huge risk it will be eaten up. Your chances of becoming a unicorn are slim, your chances of being acquired are slim, many VC’s won’t even invest in you, and if you do get to a reputable place and have one of these guys offering you money, do you take it, or do you hope to be them someday and try to fight an often losing battle?
The simple truth is monopolies will always exist. And even those who have monopolies, still compete in some way against another giant. Monopolies are both good and bad. They create jobs and opportunities and they also hinder new ones. They stifle diversity and propagate inequality in the marketplace, but they also create diversity and equal opportunity within their companies. At one point everyone who now has a monopoly, didn’t. They were once the underdog, succeeding so well in one thing, they gained a massive customer base and they were able to leverage it into other things.
The solution may not be to regulate and break up these major companies like many are trying. If anything, monopolies should force any daring entrepreneur to really create something game changing. Something that’s in your DNA and not part of any scheme to be rich or famous. It’s the only thing that will keep you going. You need to create special ideas and products that can’t be replicated or easily destroyed, and if it can be, really ask yourself why you’re doing what you’re doing, because Marky Mark, Bezos or some Google founder may just come and steal your thunder.