Ellie Howard

Problems of abundance: a (very) brief sketch.

If you change distribution, you change the world. 

You can understand most things related to making and spending money through the lens of distribution, that is the way that supply meets demand for any good, whether it be a product, a piece of content, an exciting new hire, or a term sheet. 

Distribution explains why today, commerce companies are becoming media companies, media companies are becoming commerce companies, and VCs are content machines. It also explains why we're all crazy for Ben Thompson and his work on bundling & unbundling.

Up to the 20th century, distribution was based on geography, age and class 

20th century producers had a single aim: to get people to buy what they had already made. Their distribution mechanisms utilised demographic data to work out how to match the right things to the right people. 

Fixed shelf space was merchandised for the selection that'd sell for the local population, and mass-media advertising was targeted at audiences based on the time slot in which they viewed content. 

But as the internet reduced the costs of production, distribution started to become plagued by abundance. This was temporarily solved by the algorithmic feed  

All of a sudden, it was free to consume the world's information and release new media. The ability to rent a server affordably using AWS meant that the shelves of the companies we were buying from became limitless, leading to an explosion in the number of goods on offer. 

Distribution mechanisms that used recency (chronological content, 'latest picks') were no match for a firehose of content and products.

The answer to managing the overwhelming flow of content lay in using psychographic data to determine what to show to each person based on their interests and those that they knew. 

Facebook's social-graph, and resultant product advertising business, solved distribution until the expansion of ad inventory started to hit the limits of human attention.  

But information asymmetry is back 

Today, an abundance of products, content, capital and people has re-introduced information asymmetry as we struggle once again to effectively match supply and demand. Too much content leaves us hungry for context, too many products see us turning to curators, and too many people means we search for (additional) credentials. 

Packy McCormick says it best when he explains the hard thing about easy things. Once everyone is armed, the next opportunity to make money is to bring order to the chaos." 

This is forcing us to 'rebundle' content, products, people and capital in new ways, and attempt to build new distribution mechanisms altogether. In doing so, we're rendering traditional labels like 'retail', fintech' and 'media' redundant.

For the past three years, I've been reading around this topic  and believe that the current wave of information asymmetry caused by abundance can explain the rise of single SKU brands, connected fitness bikes, cohort-based courses, nfts, tradeable revenue contracts, the knowledge management craze, building in public, rolling funds, plug-ins, calendar apps, and Pinduoduo's market cap.

I have found it helpful to sort approaches to solving problems of abundance into five loose buckets, and with this context, have been exploring a range of startup ideas.

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