Invest Like the Best with Patrick O'Shaughnessy Ben Thompson – Platforms, Ecosystems, and Aggregators - [Invest Like the Best, EP.176]
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Jun 2, 2020 
Ben Thompson, author of the influential newsletter Stratechery, dives deep into the world of business strategy. He discusses his aggregation theory, exploring how digital platforms like Google and Netflix reshape industries. The nuances of platform vs. aggregator are examined with Shopify and Amazon as case studies. Thompson also addresses the cyclical nature of tech disruption and the importance of value chain thinking. His insights on building successful businesses and navigating competition offer valuable lessons for the future of technology.
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Tech's Not So Special
- Tech companies are not as uniquely disruptive as they believe.
- Foundational tech companies like Apple, Google, Microsoft, and Amazon are likely to remain dominant.
Smiling Curve Value
- The smiling curve illustrates how value is concentrated at the ends of the value chain: brand/marketing and R&D/manufacturing.
- Companies in the middle (fabrication) capture less value.
Aggregation Theory
- Aggregators control demand, not supply, connecting directly with customers and benefiting from zero marginal costs.
- Their customer acquisition costs decrease as they scale, creating a virtuous cycle.