The acquisition of Jotspot by Google supports the new model of entrepreneurship which encourages companies to spend $100k or less in building a new product. I do not know whether Jotspot is profitable, but Google obviosly sees opportunity within this space. One question I have is did Jotspot investors make a disproportionally higher return on their investment since it was lower than the historical levels of $3M usually required for venture capital?
Is it now easier than ever to reap a return of Millions on a $100k investment that it would have been?
The new model of low cost entrepreneurship still needs to be validated is in building sustainable businesses on their own. Can they reach the scale and convert enough advertisers or customers to pay up? Theoretically, it should be easier as the new cost structure is dramatically lower and so the amount of revenue required to become sustainable is much lower.
Paradoxically, low cost entrepreneurship has a few major hurdles to overcome, and that is that can they build something, create a revenue model and grow it fast enough to outperform other start-ups within the same space? If so, how do they do that?
