Dear SaaStr: Do venture capitalists choose companies that have no competition or ones that are trying to disrupt a competitive market?
I think most VCs do both.
We did an analysis of SaaS startups that had IPO’d and about 70% were new versions of something new, and 30% were truly new categories:
So VCs like to do both.
The reality is, entering an existing market especially in B2B is often faster and easier, despite the competition. But creating a new market is sometimes where the really huge outcomes come.
Startups that had plenty of competition:
- Slack
- Zoom
- Asana
- Canva
- Notion
- Wiz
- Figma
The list goes on
