Stripe Wants to Buy PayPal. The Real Prize May Be Hiding in Plain Sight

Stripe’s $53 billion bet reveals a brutal truth about the tech Industry.

EXPERT OPINION BY HOWARD TULLMAN, GENERAL MANAGING PARTNER, G2T3V AND CHICAGO HIGH TECH INVESTORS @TULLMAN

One of the oldest ideas in the technology world is that most of the competitive races among new entrepreneurial entrants that are proposing to provide various novel products and services will eventually resolve themselves into markets and verticals dominated by one (or at most two or three) very large and successful players while the rest of the also-rans and wannabes share the crumbs left on the table, until they eventually fold up their tents and pack it in.

It’s a cyclical circumstance in the tech industry and we’re seeing it again today in the AI frontier engine competition with the clear dominance of a few major platform players. Technology is a “winner take all” world driven by several practical and structural considerations that typically drive this kind of concentration conclusion. Some of the key contributing factors to this recurring outcome: demonstrated economies of scale, market-dictated centralization and standardization requirements, the herd mentality of large technology purchasers—believing that you can’t go wrong or lose your job if you’re buying what everyone else is using—and the power of Metcalfe’s Law, which describes and defines the........

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