2024-07-26 - Two by Two- Why has all the excitement and disruption gone out of startups- - Omnivore

# Two by Two: Why has all the excitement and disruption gone out of startups? #Omnivore ## Colophon title:: Two by Two: Why has all the excitement and disruption gone out of startups? type:: [[clipped-note]] tags:: [[&omnivore]] Newsletter url:: https://omnivore.app/no_url?q=ae962291-741b-4f04-a9a1-9e375b8fc8e3 archive:: https://omnivore.app/me/two-by-two-why-has-all-the-excitement-and-disruption-gone-out-of-190ecb74dc4 date:: [[2024-07-26]] ## Highlights tags:: > I’ve heard stories about founders and co-founders of some of India’s biggest startups who confess in private, closed circles that they no longer feel much joy or satisfaction from what they’re doing—but they see no option but to continue running on the treadmill. [⤴️](https://omnivore.app/me/two-by-two-why-has-all-the-excitement-and-disruption-gone-out-of-190ecb74dc4#d928fb26-d94f-4abc-94fe-421c321a41f4) ^d928fb26 tags:: > There’s an entire generation of people inside startups who are weary, tired, and see no purpose. These are smart, talented, ambitious people, who were once excited and found meaning in work. [⤴️](https://omnivore.app/me/two-by-two-why-has-all-the-excitement-and-disruption-gone-out-of-190ecb74dc4#82b783f8-6bcb-43d8-8776-912558e65a9b) ^82b783f8 To these people, if you have the time, volunteer it with non-profits doing long-term thinking work. tags:: > Prof. Mukherji’s argument was essentially this—you don’t have to take advice from the people you take your money from. Sure, VCs are in the business of risk capital, and hence have an incentive to be overtly positive about the future. However, the influence of VCs also led to other eventualities, such as inflated valuations that fundamentally altered incentives inside startups, making them less likely to create disruption. [⤴️](https://omnivore.app/me/two-by-two-why-has-all-the-excitement-and-disruption-gone-out-of-190ecb74dc4#b6a37859-6c77-4a42-9a64-abe84d637acb) ^b6a37859 tags:: > “I don’t think there’s been a more dangerous time to be a disruptive startup than India today.” He explained. “You can look at sector after sector where, I mean, it could be something like bike taxis, where a regulator comes in. Like just last week, a few days ago, rows upon rows of bikes have been impounded in Bengaluru. You could look at the number of fintech apps that have been shut down, put on hold. You could look at credit card companies that have been forced to, or banks that have been forced to stop onboarding. So I feel like I’m fully on the side of startups, here.”**–0:47:25 minutes** The argument is that startups aren’t disruptive anymore because it’s far too risky to be disruptive. And that risk hasn’t been created by VCs, but by _regulators_. [⤴️](https://omnivore.app/me/two-by-two-why-has-all-the-excitement-and-disruption-gone-out-of-190ecb74dc4#ee4ba7e4-cb69-4c3e-9b43-a971b383a38f) ^ee4ba7e4 tags:: > “You don’t stick your neck out if somebody’s going to chop it.” [⤴️](https://omnivore.app/me/two-by-two-why-has-all-the-excitement-and-disruption-gone-out-of-190ecb74dc4#1899ff75-2b1d-4e4d-8e24-f4bd9aef556c) ^1899ff75 oh, look, a comment that also applies to politics! tags:: > However, there are reasons to believe that this ‘lull’ is different. For example, online e-commerce fundamentally changed due to Amazon in the US, and there’s no reason to believe that disruption will come back to that sector. In fact, there’s a fantastic paper titled _Coopting Disruption_, written by a couple of researchers at the Stanford School of Law. They argue that disruption is much harder, because it’s being ‘coopted’ by Big Tech in the West. The abstract [reads](https://papers.ssrn.com/sol3/papers.cfm?abstract%5Fid=4713845): “Our economy is dominated by five aging tech giants—Alphabet, Amazon, Apple, Meta, and Microsoft. In the last twenty years, no company has commercialized a new technology in a way that threatens them. Why? We argue that the tech giants have learned how to coopt disruption. They identify potentially disruptive technologies, use their money to influence the startups developing them, strategically dole out access to the resources the startups need to grow, and seek regulation that makes it harder for the startups to compete. When a threat emerges, they buy it off. And after they acquire a startup, they redirect its people and assets to their own innovation needs. These seemingly unrelated behaviors work together to enable the tech giants to maintain their dominance in the face of disruptive innovations.” [⤴️](https://omnivore.app/me/two-by-two-why-has-all-the-excitement-and-disruption-gone-out-of-190ecb74dc4#188af10a-c0a8-4abd-af2e-79fbf43e92cf) ^188af10a tags:: > Essentially, the youth shall not just inherit the earth. They’ll be the ones who’ll create it. [⤴️](https://omnivore.app/me/two-by-two-why-has-all-the-excitement-and-disruption-gone-out-of-190ecb74dc4#4d570717-f40f-462e-a423-13286da7e2e3) ^4d570717 I don't know whether to be enthused or terrified by this... [Read on Omnivore](https://omnivore.app/me/two-by-two-why-has-all-the-excitement-and-disruption-gone-out-of-190ecb74dc4) [Read Original](https://omnivore.app/no_url?q=ae962291-741b-4f04-a9a1-9e375b8fc8e3)