There may be a constant flow of new players, but much of the time when they start to show a certain amount of success then one of the big players simply buys them up.
You phrase it as if these are hostile takeovers. Having been a founder, I can state that most of my peers wanted acquisitions. It was a way to finance the vision and growth.
Would YouTube, Instagram, or dozens of other companies have been able to get where they are w/o the support of their acquirers? Just think of the burn alone and the required investment is a scary figure.
The situation isn't comparable to social media unicorns courting acquisition at all.
Comcast and the other big incumbents have one very clear overt objective: own the customer base for the foreseeable future. If you're a small independent ISP and try to go up against them, as soon as you're on their radar you can expect a pretty ruthless attack. The most mild form of this is Comcast's sales team is willing to offer something closer to fair pricing to condo properties if it involves ~5 years lockin vs a new competitor. A friend owns a business in this space and has watched a couple competitors that were growing fast locally suddenly find their entire customer base gone within weeks via this. Less fortunate people find themselves facing a legal challenge at the city or state level.
And that's not even getting into what happens if your small ISP competitor gets going well enough to start talking to the city about renting space on utility poles or doing some trenching.
These mega ISPs aren't interested in acquiring competition for the last mile. They want to pre-empt competition existing entirely, and they can and will use every single tool available to them in doing so.
> Would YouTube, Instagram, or dozens of other companies have been able to get where they are w/o the support of their acquirers?
Yes if they got access to capital, which they could have gotten easily. You forget that Google bought Youtube because google video wasn't gaining traction and youtube had the "network effect". The same goes for instagram and facebook. It's all "whatif" but youtube and instagram most definitely would have been major independent players by themselves.
Facebook, Netflix, Google, Amazon, etc were able to grow without being acquired. Remember that page/brin even tried to sell Google to Yahoo. Google did alright even though they weren't bought out.
Youtube and Instagram had no real peers like google did ( altavista, excite, etc ) and they both were able to create the network effect before they got bought out. I think google and facebook really got lucky snapping up these companies. Not just in financial benefits but look at the cultural impact these companies have on the world.
I understand your pain on this because i've been there. At the same time, deep down, I think many of us have also learned the truth:
If there is some startup providing some ridiculously awesome service and strangly isnt charging:
1. It will charge in the future, and even that charge may not be sufficient to cover costs (see: Quantopian recently, apparently could not find a price point which kept users and also kept the service)
2. It may get acquired, to finance long-term profitability (see: YouTube, WhatsApp, Instagram)
3. You may be giving up more than you thought you were (e.g., privacy) (see: like half the social media startups)
4. It may get acquihired, and often the product is sunset (see: Slide, Parse)
5. It may shut down (see: like 95% of your friends startups)
As a former founder, I can say most startups are just one funding round away from case 5 (bankruptcy) -- see MapR. In which case, sometimes you accept case 4 (acquihire) as a consolation prize. Many of us want to be the next FAANG, but reality strikes that obviously not all 100,000 startups out there will become a fang. Often, you teeter in case 1 (barely making it), and if that happens too long, you might go with option 2 (strategic acquisition.)
There are a lot of problems as a founder. Not all of them are actually about tech. I'll list some problems:
1. You are constantly questioning yourself -- is life just about eating ramen noodles and working? Did I really study and get top grades for 20yrs only to barely life? Mabye I can sell out. This should not be a problem post Series A, but is def an early stage issue.
2. You have liabilities - student loans, healthcare, rent, etc. Sure, you can couch surf, but should that be expected of people?
3. After marketing and ads especially, you often dont make as much as you think.
Sometimes you make a limited time bet, and if things dont catch, you move on.
No, I simply said they get bought up. Any negative inference is your own. Feel free to suggest what you believe to be a more neutral term for being purchased by another company.
