By simple re-sellers I mean low-margin pile-it-high sell-it-cheap companies. There are lots of IT hardware companies in this category and some etailers where long term profitability can be elusive. Companies (like Graze) that change the product on the way through or add value via their brand fall outside of this.

I would tend to agree on confusing business models, although still a long way to go in lots of industries such as finance and travel. I don't think the confusing nature of some of these industries will prevent VC investment though partly because I don't expect them to become transparent in the near future.

I guess the argument is really about the difference between short term revenue/profit generation and the long term. Arguably I think a lot of VCs have actually invested into the former and aimed for a quick exit – but I expect we will see a re-focus on long term value building. I always think the most important question to ask a company is “What will be your long term, unfair, competitive advantage” and I think it is the lack of that for some companies that is really the issue you are addressing. If they have that competitive advantage, they will be building value.

By simple re-sellers I mean low-margin pile-it-high sell-it-cheap companies. There are lots of IT hardware companies in this category and some etailers where long term profitability can be elusive. Companies (like Graze) that change the product on the way through or add value via their brand fall outside of this.

I would tend to agree on confusing business models, although still a long way to go in lots of industries such as finance and travel. I don't think the confusing nature of some of these industries will prevent VC investment though partly because I don't expect them to become transparent in the near future.

I guess the argument is really about the difference between short term revenue/profit generation and the long term. Arguably I think a lot of VCs have actually invested into the former and aimed for a quick exit – but I expect we will see a re-focus on long term value building. I always think the most important question to ask a company is “What will be your long term, unfair, competitive advantage” and I think it is the lack of that for some companies that is really the issue you are addressing. If they have that competitive advantage, they will be building value.