The new unbundlers

I’ve always loved the Jim Barksdale quote from the Netscape IPO roadshow: “There’s only two ways I know of to make money: bundling and unbundling” — mainly for its simplicity and truth that has stood the test of time and markets.

Today, Amazon has emerged as the Apex Predator of bundlers.

Amazon & Apex Predator of bundlers

It’s been bundling pretty much everything since it started selling books online as in 1995. The scope of that bundling couldn’t be more clear than when Jeff Bezos told Walt Mossberg in 2016 “when we win a Golden Globe, it helps us sell more shoes in a very direct way.” Or when the totally plausible rumor that Amazon was acquiring Capital One circulated earlier this year. For Amazon, which probably holds more credit cards on file than anyone, becoming a bank seems inevitable. The fact that the rumor didn’t take the market by surprise only further makes the point.

There are plenty of companies that have figured out how to compete with Amazon:  Bonobos, Warby Parker, Trunk Club, Apple, Tesla. These companies have built differentiated products, but importantly, they offer differentiated experiences to their customers which allow them to thrive in today’s climate.

So basically, everyone other than Amazon is an unbundler, whether they like it or not.

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