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A comment on Ask HN: Why do VCS see market opportunity in dev tools?.

Re:Ask HN: Why do VCS see market opportunity in dev tools? by codegeek on Thursday June 29, 2023 @10:59AM (#36521301)
I love dev tools. Few reasons I can think of:

1. Software is everywhere. To build/run/manage software, you need Dev Tools. The demand can only go up as we continue to depend on software for everything.

2. Dev tools solve specific problems at least to start with. This makes it a bit easier to find PMF faster or die. Faster PMF = Faster Growth capability = Chances of Unicorn. VCs love that stuff.

3. Lot of current success already with Dev Tools as you mentioned. VCs have a herd mentality. They follow where the success is. Dev Tools has been hot for a while and will continue to be.

4. Dev Tools are usually started by techies who love building tools and cannot be started by MBA types usually. This means that the founders are usually solid with a background in those areas and they are likely to succeed more. Just my personal opinion.

[ Parent | on HN ]
Re:Ask HN: Why do VCS see market opportunity in dev tools? by as90 on Thursday June 29, 2023 @01:42PM (#36523884)
Good points. But I'm trying to understand why do they even fund startups even without a well defined moat? I've heard that VCs will fund (even seed round) only if the startup has a chance to make atleast $100M in ARR. Then why do they bet even on startups who just copy and without a proper moat?
[ Parent | on HN ]