YodaCategory: OtherHow do you think about the differences between the core decision to build an asset-heavy or asset-light business?

Michael Frank ( @michael ) Staff asked 9 months ago

Staff

How do you think about the differences between the core decision to build an asset-heavy or asset-light business?

1 Answers
Gagan Biyani ( @gaganbiyani ) asked 9 months ago


I’ve learned my lesson from Sprig. There are people who are well-suited to asset heavy businesses. I am not one of those people. I care more about leverage, having a light footprint, and generally want to build software businesses. There may be a services component but I’ll stay away from operations-heavy businesses for the next decade or so until I’ve gotten more comfortable with my skills there.
 
Ultimately, it is custom to the business. Do what’s best for your business, but be aware of the downstream consequences: asset heavy often means higher barriers to entry and stronger customer experience, but they come at the cost of slower scale and increased cost of capital.