Entrepreneurship

B2B v. B2C v. …..

In a recent conversation I was having with a NYC early-stage VC, the conversation turned to a topic I quite honestly hadn’t thought much about: “In the near future, do you think B2B or B2C will be bigger?” After giving my reply, he thought that my view of B2B was contradictory to the general viewpoint of the venture capital industry. Thinking back, however, perhaps what I had a greater difficulty with was the premise of the question itself.

Traditionally, we have seen a lot companies serving businesses (broadly defined) and consumers. Now, however, we have some terrific large and small companies serving developers, an entirely new customer of the 21st century. One customer that continues to be underserved is governments, especially “non-federal” ones. I call this group SMGs (small and medium governments). There is a real data service opportunity for this group, and only a handful of local, startup and nonprofit organizations currently serving it.

Remember, that’s just the customer base; now let’s think of the even larger issue of geography. Yes, the internet has made certain products, platforms and services available to a wider variety of populations, but that does not mean that a US solution is applicable to Brazil. Of course there will be corporate consolidation through M&A activity, but the solutions still remain relatively unique given equal scaling opportunities.

So if asked again, do I think B2B or B2C will be bigger in the near term, I think the answer will be: “Yes. They will both be big, as will B2D and B2G. Plenty of room in all four for growth.”

What industries do you think will be biggest in the startup world? Tweet at me with #nextgen, and let me know!

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