Not a very convincing article. I don't think risky VC investments are going anywhere. This downturn is just s blip in the big scheme of things, and as expectations of long-term economic growth are built into so many things we do (e.g., buy-and-hold investing), expectations of "bigness" are extremely likely to return. And a new cycle will be born.
Misleading title. Blitzscaling is just about a specific strategy for growth; it has almost nothing to do with the main point of the article: oversupply of office space removes future plans for office space, and eventually makes your office supply very scarce and therefore valuable.
I think he's talking about companies primarily, and office space is the analogy (building offices analogous to building companies). Thus that company you built in the times of cheap money may not be profitable for a while, but its now got fewer competitors to deal with.
This is more or less tech in the oughts. There were a few booming companies like FB and Goog. Everyone else was riding investment from the 90s.
We’ll see how it plays out in the next few years, but I wouldn’t be surprised to see companies slow down R&D to capture profitability. In 5 years they may be too slow to innovate
Agreed with this sentiment. If the author clarified the relationships and examples more explicitly as you and the og have done, that would strengthen the writing/ideas.
The end of New York’s sustained growth was a policy decision, not something that just happened so it’s a particularly bad example. It was a massive unforced error, like the Chinese government going after all its internet giants with a hammer. If you have an engine of economic growth you don’t deliberately hobble it.
> If you have an engine of economic growth you don’t deliberately hobble it
Why not? NYCs economy is already plenty large. It’s not clear to me that adding thousands of extra hypergrowth startups to the mix does anything to actually improve the city. Just more transplant office workers, many who don’t really like NYC, and don’t really gain much from living in the cultural center of the US.
"a massive unforced error, like the Chinese government going after all its internet giants with a hammer"
Depends on who's viewpoint you're talking about. The Xi and CCP are so far presumably very happy with the results, because those companies are no longer much of a threat to their power.
Who made the decisions to end New York's sustained growth?
It's missing something essential to blitzscaling. It's not just cheap capital, although it helps.
The presence of the internet and the amount software can improve everything created a business model of "add software to it!" And suddenly your TAM was "the entire physical universe".
Encouraging the strategy was the fact that add software to it is a very dumb idea, so anyone can have it. The way to win is to get bigger than your opponents, faster.
Besides obvious flaws in the article, let's assume that there is general "Blitzscaling is dead" phenomenon going around. That is exactly the time to Blitzscale.
On a separate note, this is exactly the time to double-down manufacturing in China and supply-chain homogeneity.
