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Accel Partners: The Past, Present, and Future of E-Commerce. Chapter 7 Case 1. Accel’s Strategy. Invest only in businesses that meet a traditional measure of profitability. First-mover advantage was a myth. History shows the second or third movers usually end up dominating their markets.
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Accel Partners:The Past, Present, and Future of E-Commerce Chapter 7 Case 1
Accel’s Strategy • Invest only in businesses that meet a traditional measure of profitability. • First-mover advantage was a myth. History shows the second or third movers usually end up dominating their markets. • Carve out strategy - take the assets of big companies and put them into standalone businesses that could act with the nimbleness of startups.
Past Lessons • Focused specifically on gross margin structure. • Leaders are not necessarily first to market. • Companies who are second or third to market can capitalize on enormous opportunities.
Present Position • E-commerce has gone through the initial mass frenzy and surreal hype. • Consolidation will eliminate many of the “pure-play” e-commerce companies. • A handful of E-commerce business will survive the shakeout and become multibillion dollar businesses.
Future Prospects • Companies will have opportunities to lead in the second wave of e-commerce. • Businesses handling physical goods will employ a “carve out” strategy to take advantage of their core competencies. • Businesses will have opportunities to fundamentally change the industries’ business models - i.e.., peer-to-peer and P2P models.