The secret behind the growth of the majority of disruptive companies is their platform’s ability to create value for other businesses. That is the main shared element of Facebook, Apple, Google, Amazon, and almost all big and not-so-big tech enterprises. By building up the principles of innovation, they have created an ecosystem where many other projects can thrive, and that is one of the main reasons for their economic success.

Some innovators called “platform” the “5th P” of the “4 P’s of innovation” described by Tidd and Bessan).

In particular, the paradigm is meant to be the frame with which the organization does what it does, its business model and innovation in paradigm it’s referred to the ability to propose its services under a different model, that differentiation would create value.

Apparently, some were not happy with this definition when referring to the platform and added the fifth “P” to evoke an ecosystem that creates moat and mutual value between the business itself and its associates.

If we think of Amazon, the IOs of Apple, or even,  more recently, in the success of Ethereum and Smart Contracts, we quickly realize that many innovations are the result of a change of paradigm. In particular, the business models that are disruptive in the way they are presented. Bringing value by producing an environment in which other businesses can thrive while using its creativity with the support of the same ecosystem. If we recall how much Apple IOS has created creativity and value or how many businesses were able to scale and increase their sales thanks to Amazon, we would be amazed by the power of those platforms.

What should be the way an investor would analyze the weaknesses and the strength of new businesses that leverage on those platforms? How should you evaluate a new DApps or service that will scale amazingly on Ethereum blockchain? And, from the other side, can a disruptive business that has implemented a new paradigm creating value for itself by allowing others to use its platform and scale, be disrupted? How much value the platform can create for itself and others, and what risks it faces?

Well, I would start by saying that things go great until they don’t. And some premises are riskier than others. Do you recall Zynga? Zynga was an American social game that grew symbolically with Facebook, exactly taking advantage of the paradigm mentioned above. The ability to scale throughout the platform was handy to Znynga’s growth, but it lost a big chunk of its value when Facebook changed the rules. How many businesses scale and rely on the ability to sell their products on Amazon? What about all those ICO and DApps entirely relying on  EOS or Ethereum?

All those companies have what is called a big existential risk. They put the key to their success on the platform on which they operate; their growth depends on a centralized platform. Funny enough, even in a decentralized ecosystem, it’s the same.

Sometimes interest can change, or conflict of interest could arise. Regulations, economics, or political reasons for which the platform is not able to let the business run anymore with the same rules, and those changes can destroy a business. Many things, for many reasons, can change from one day to another.

When you analyze the business potential and business threats, innovation should act as a competitive advantage, and the ability to capture and keep its moat to capture the value should not be in the hands of an external centralized organization.

It’s a paradox to be in a decentralized ecosystem, like cryptocurrency, and have a business model that only allows growth on other’s platforms. Is this meant to be a decentralized economy? What is decentralized in a business that its livelihood depends on a single company, platform, or project? Are Ethereum and Bitcoin genuinely decentralized? Some movements have started to fight against this.

The ecosystem needs to produce freedom from the platform, not incentivize the growth of businesses that are born with such an existential threat. They are a click’s distance of being kicked off, and it can happen anytime without previous notice.

The key to innovative businesses is working on the paradigm of innovation and free up from preconstructed systems that have their own interests and, undoubtedly, not the ones of every single business within the ecosystem.

By the way, I think the threats go from both sides. The Companies founded on the idea of being a central institution that “allows its affiliates to grow” might be disrupted. They have the risk that businesses will, one day, be able to grow independently without relying on such a fragile symbiotic paradigm. Companies that have captured this idea and are working on creating something unique, a new path that allows them to own their future.

Somehow, in the way we are operating today, especially when it comes to marketing, we are rowing back from the “free world” we wanted to create with the internet and relying again on centralized corporations that have their own agenda. We found ourselves tirelessly trying to find out and work around their algorithms that are specifically created on the base of conflict of interest and seek to keep us tied to them forever.

For instance, I was thinking about’s platform and its relation with Google. As a hotel owner and investor, I know the value that platforms like Booking or Airbnb can create for those who know how to leverage those platforms. However, as we have discussed, those platforms can change their rules or implement new ones that are not convenient for some businesses within the ecosystem and therefore put them in serious crisis. Imagine now that they are themselves in a similar situation with platforms like google. Many companies are at the end of a chain of centralized platforms that, in a matter of seconds, could fall apart like dominoes.

Nonetheless, the effort and the capital investment needed to bypass those platforms in order to grow are too big and often not convenient. They have reached significant traffic and user captivity that leave little or no space to alternative channels of distribution and sales.

As mentioned before, paradoxically, a portal like itself is vulnerable to Google. Booking is one of Google’s best clients, spending billions of dollars a year, but, at the same time, Google represents Booking’s biggest threat. Google could use its data to become more efficient, copy, and improve Booking’s business model. Have you heard of “Google Hotels” and “Google Hotel Ads”? Well, Booking should be worried. There are several examples of other businesses being eaten by these big tech platforms, and, as we know, if they cannot successfully copy you, they will end up acquiring you.

Those channels or platforms that allow others to grow could become the reason for a business’s surrender. But why disrupted businesses do not tend to respond? “Often, the challenger is actually invisible because she misdirects attention. ” The Disruption FAQ – Q7

As an investor, I need to invest or create businesses that do not rely on a centralized platform that could stab me in the back anytime by completely disrupt or destroying me. It’s a Damocles sword that would limit my growth and compress my multiple due to an existential risk that could materialize anytime, and I will never overcome.

In the blockchain industry, I have spotted a company called Dfinity that is already thinking about how to disrupt centralized platforms by creating an internet computer with an advanced decentralized protocol that is run by independent data centers. The new internet computer will create internet services under a completely new paradigm protecting users’ data and disrupting the monopolistic nature of the relationship that Big Tech it’s establishing by owing and controlling all on their platforms.

About Antonio Velardo

Antonio Velardo is an experienced Italian Venture Capitalist and options trader. He is an early Bitcoin and Ethereum adopter and evangelist who has grown his passion and knowledge after pursuing the Blockchain Strategy Programme at Oxford University and a Master’s degree in Digital Currency at Nicosia University.

Antonio manages an 8-figure portfolio of his investment company with a team of analysts; he is a sort of FinTweet mentor, people interact with him online, and he has more than 40,000 followers after his tweets. He has built a fortune in the great tech years and put together a tail strategy during the pandemic that allowed him to take advantage of the market drop. “I did not time the market, and I did not think this was even a black sworn,” he says.

On the side of the financial markets, Velardo has a unique combination. He was a real estate entrepreneur that developed several projects in Tunisia, Miami, Italy, the UK, and many other countries and cities. But he has always been passionate about options trading. Still, contrary to the volatility player and quant trading, he always had a value investing touch in his blood. Antonio studied Value Investing at Buffet’s famous business school at Columbia University. Even though the central concepts of value investing are antagonists to the venture capital pillars, Antonio’s approach tries to bridge elements of both worlds in order to seek alpha. Velardo has learned the importance of spotting pure growth stories and taking advantage of their S-Curve position. This is an essential element of Velardo’s approach as he looks forward to embracing great tech stories at the right time of the adoption cycle. This applies to stocks but also to blockchain projects.