Google is a new way of monetising attention through advertising, which is not a new industry necessarily. Amazon is a logistics and retail company. As a consequence of this hyper-scale emergence, especially within software, this means that early success is more likely to be recognised and purchased (via M&A to be taken off the market) as a stick and carrot combination.

Simultaneously, the glut of capital around the world looking for yield means that any glimmer of hidden value within a company results in a large sum of capital being thrown at it in the hopes of an outsized win. But, the only winners in this game tends to be the occasional lucky entrepreneur, who gets rich, and the large tech giants who act as gatekeepers to the attention economy, who suck up the capital by acting as the conduit for any customers that the start-up might hope to reach. It is rent-seeking at an economy-wide level.

So with tech as an enabler and a bit of business model innovation, we have new industries forming doing the same functions as before but now slightly more efficiently. There is, however, a difference between innovations that would have happened anyway due to the increasing efficiency within an industry, vs paradigm-shifting innovations that create a new trajectory that would not have existed otherwise. This is also why fundamentally new industries like deep research, Biotech, and space exploration are often as too risky for venture capital and somehow not seen as a tech at all. Same for shipping, oil & gas, mining, and construction, it is also almost a vilification of hardware as fundamental to software.

It is interesting to reframe the reality, that past a certain scale companies become effective utilities, which are famously monopolistic and resistant to change. For those who work alongside technology firms as investors or buyers, it is critical to realise that the landscape shift has changed the power dynamics as was inherent in the market. Larger companies create effective de facto standards that the rest of the world has to adhere to.

To substantially alter one's potential for success in such an environment requires identification of niches that seem small in the beginning, and then to exploit that niche to slowly and steadily expand the dominion. As an investor, I'm looking at companies which have the potential to affect this ninja manoeuvre, while the larger organizations have to try and corner a part of their market to build up its negotiating power as the only way to deal with this transformation.