startups

Consumers to Enterprise – The Investment Rationale Cycle

Today the hottest thing in new startup investments is “enterprise” startups and for someone old like me, it gives a d?javue kind of feeling. It seems investments behave in a cyclical manner where the first field of growth is always in the area of consumer products. In consumer products innovation is only limited by imagination. After a phase of massive investments in the area of “consumers,” there is a stage where a big portion of the portfolios face a roadblock of “how the hell do we monetize this and make a big business out of it”. And then everyone flocks into “enterprise” driven innovation where the money issue is seemingly “solved” and innovation is restricted mostly to the imagination of the customers and not of the innovators. A far short-sighted and extremely realistic kind of imagination driven by enterprise CIOs. This last shift usually breaks the “spirit” of free-thinking entrepreneurs which many times make the whole wave end in a bust and then back again to step #1!