With the advancement of dev tooling and LLMs, there’s a growing consensus that we’ll witness a proliferation of even more tiny companies. These micro-teams will be capable of building products and services that once required thousands of employees to develop and maintain.

As the barriers to entry plummet, several second-order effects may emerge:

  • Reduced reliance on venture capital
  • Heightened importance of non-technical moats: Network effects and other intangible assets will become increasingly crucial for competitive advantage.
  • Likely a pull forward of monetary payoff: more profit distribution models instead of stock options.
  • Increased vertical integration: Companies focus on dominating specific niches or integrating multiple parts of their value chain.
  • Intensified competition for attention: As more startups emerge, standing out becomes increasingly challenging, making effective distribution and marketing even more critical.
  • Decentralisation of tech hubs.