How can VCs compete with tech giants?


Venture capitalists (VCs) can effectively compete with tech giants by leveraging shifts in technology and distribution platforms. According to , startups should focus on identifying and utilizing these platform shifts because they represent opportunities in distribution that incumbents may not quickly adapt to. This strategy enables startups to reach customers through new, innovative channels like app stores or smart home devices before large incumbents can establish dominance (1).

Additionally, as emphasizes, although it's become less costly to start a company, scaling requires significant investment. VCs can play a crucial role by providing the capital startups need to scale swiftly and establish a strong market presence before incumbents can respond. This investment is essential for building defensible positions in the market, despite the increased cost of customer acquisition and market penetration (2).

In summary, VCs can compete with tech giants by:

  1. Capitalizing on new distribution and technology platforms to gain early market access.
  2. Providing substantial capital support to startups for rapid scaling and market defense against incumbents.

    Competing with Giants

    Jerry explains how startups can compete with industry giants by leveraging platform shifts and distribution channels to reach customers directly.


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