Note that often this low price for internet companies is 0 and many users will not put up with any price increase, so the VC backed company will fail once their monetisation strategy ( usually it’s “something something advertisers”) doesn’t pan out.

A small profitable business is harmed by the unsustainable competition at steps 1-2 and may struggle to hold out until step 3 (which likely won’t happen; going bust/being acquired and shuttered seem more likely to me) or 6

That’s just a better company.

Companies that have enough market power to crush smaller competitors tend to also drive the quality of products down. I’d prefer more high quality products to fewer “better companies”.

I’m responding to OP.

>> there is so much vc money sloshing about that one is constantly fighting competitors who operate at a loss to try to build monopolies

He’s claiming that VC companies use their warchest to undercut and ultimately force out incumbents.

> Most interesting companies aren’t building commodities like toothpaste.

Why is price less relative for “non-commodity” companies?

> Companies that have enough market power to crush smaller competitors tend to also drive the quality of products down.

Maybe? Peter Thiel talks about small margins in competitive industries leading to lower quality products because companies lack sufficient resources to innovate. eg, Google’s advertising domination lets them build high quality products like GMaps and GMail.

Another bigger problem is that the monopolist pushes the low cost of delivered goods or services on third parties (see the gig economy). That race to the bottom harms people, but there will always be takers for those jobs in any society without a good social security system.