Like many else in the financial media, I spend my fair share of time thinking about the future of technology companies. From an investment perspective, it is not so much the excitement of tech-related products that draw me in so much as it is the incredibly high profit margins in the industry as well as the immense profitability that results from ease of scalability. In essence, that is the promise of the Internet. You can go from selling 1x to 10x in a way that you never could if your sole operating asset was a restaurant in the rural Midwest.
Having said that, I am also quite aware that, historically, the long-term survival rate of tech companies is quite low and the result of a competitor with a better product tends to be displacement rather than subordination of the inferior product–i.e. If you build a better house, the inferior house … Read the rest of this article!
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