Imagine, for a moment, a world in which Uber and Lyft hadn’t been able to raise billions of dollars in a winner-takes-all race to dominate the online ride-hailing market. How might that market have developed differently?
Uber and Lyft have developed powerful services that delight their users and are transforming urban transportation. But if they hadn’t been given virtually unlimited capital to offer rides at subsidized prices taxicabs couldn’t match in order to grow their user base at blitzscaling speed, would they be offering their service for less than it actually costs to deliver? […]
We’ll never know, because investors, awash in cheap capital, anointed the winners rather than letting the market decide who should succeed and who should fail.
Tim O.Reilly on blitzscaling.
Related: I always kind of fascinating that the pop perception of capitalism is one of competition on an equitable playing field—to the point where the word “competition” itself is often used as a synecdoche—when in reality like, no major “capitalist” institution works like that at all…