Tesla vs. Nio and why first mover advantage is not as awesome as everyone thinks. At least not in tech.

You can listen to this podcast here or at iTunes, Google Podcasts and Himalaya.

Advantages of first mover in tech can include:

• Bigger advantages:
  • Temporary supply-demand imbalance
  • Increasing returns to scale
  • Switching costs
  • Network effects
  • Learning effects
• Smaller advantages:
  • Brand loyalty
  • Technological leadership
  • Scarce assets in tech

Disadvantages of first mover in tech can include:

• High failure rate
• R&D expenses on successful and unsuccessful tech.
• Cost of building production processes and complementary goods not available in the market
• Cost and difficulty of developing suppliers and distribution channels.
• Cost and difficulty of building consumer awareness and education
• Availability of enabling technologies and infrastructure
• Uncertainty of customer requirements

Related podcasts and articles:

• Introduction to Innovation, Elon and Android’s Dominant Design. (Jeff’s Asia Tech Class – Podcast 58)

Concepts for this class.

• Increasing Returns to Tech Adoption
• First Mover Advantages and Disadvantages.
• Path Dependency
• Resource Based Competition
• Core Competency
• Supply-Demand Imbalance

Companies for this class:

• Tesla
• Nio

This is part of Learning Goals: Level 7, with a focus on:

• #32: Innovation, Adaptation and Resilience as Competitive Strategy

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I write and speak about digital China and Asia’s latest tech trends.

I also run Jeff’s Asia Tech Class, a podcast and subscription newsletter for investors in China / Asia tech companies.

This content (articles, podcasts, website info) is not investment advice. The information and opinions from me and any guests may be incorrect. The numbers and information may be wrong. The views expressed may no longer be relevant or accurate. Investing is risky. Do your own research.

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