The Durability Formula – How It Will Determine Your Startup’s Future Value

Nearly all of the value in technology companies is created in the out-years, long after you start. But you can only capture the value in the long term if you design for durability from day one.

There are five main factors that build lasting power for startups.

Durability = Network Effects + Economies of Scale + Brand + Embedding + IP

This isn’t a real math formula but rather a mental model for making sure you address these five core forces as early as possible.

These factors are what we at NFX spend a lot of time working on with our Guild companies because we know it drives extreme, long-term value. Over the years, we’ve discovered learnable tactics for designing for durability from day one.

Founders who work through the 26 questions listed below will be well-positioned to capture the compounding long-term value created by their companies. You won’t simply think about creating initial value — you will also think about how to defend & capture value. Once you have a durable business, that’s when you start building 10X, 100X and 1000X value for yourself and your team.

 
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Πηγή: nfx.com