McCormick: Vertical integrators take integration risk over science risk to outperform incumbents
Packy McCormick · How Writing Led To Investing In Ramp, Scale AI, Replit, Varda | Packy McCormick, Not Boring · Sourcery with Molly O'Shea · Feb 14, 2025 · at 27:16
Packy McCormick, founder of Not Boring Capital, breaks down his investment thesis distinguishing vertical integration from traditional deep tech.
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“There's a lot of like deep tech that I think you're taking science risk. And like, I think with vertical integrators, you're taking integration risk where there's like five different kind of like cutting edge-ish, but proven technologies that you're trying to put together in, in a system. And you're betting that that system delivers a product that's better, faster, cheaper, And ultimately has higher margins that you can reinvest in the business and grow faster than the incumbents and like, hopefully a slope and over-intercept thing over time where not only not only kind of should they eventually be able to beat them, but like they should be bigger than the incumbents that they replaced because they have higher margins and faster growth. And so their evaluation should theoretically be higher.”
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