The Tendency Towards Managerial Capitalism Makes Startups Possible

In the modern economy, managerial capitalism is the prevailing way companies are run. While startups tend to resemble bourgeois capitalism at the beginning (founders with full ownership and control), they eventually transition to a managerial model to scale (managers with low ownership but full control). Ironically, this transition is why startups are possible in the first place—it creates an opportunity for new startups to innovate. We know this is true because the big established companies don’t continue innovating and building all the new things themselves.

Dwarkesh Patel’s interview with Marc Andreessen