On Value Capture
The single most important art in business is pricing.
Welcome to my Substack – where we dissect the anatomy of business beyond the balance sheet.
I'm Johan Trip, co-founder of Zaasly.com and a seasoned voice on subscription commerce in Europe.
On this Substack, I pivot the conversation to a subject that whets the intellectual appetite of industry titans like Charlie Munger and Peter Thiel: Value Capture. This is the dichotomy that defines the true worth of a business, not just its size or market share.
Value Capture is intriguing – it’s where profit really plays out in transactions. This concept, despite its pivotal role, hasn't received its due in mainstream business literature, even though it shapes the fortunes of the most astute investors and companies.
In this newsletter, we’ll unravel the threads of this topic, drawing from the wisdom of Munger, Thiel, Buffett, and Gurley. We'll cover:
The distinction and independence between Value Creation and Value Capture.
How over-investment can sometimes erode the very value you seek to hold.
The nuances that set apart revenues – why some dollars are worth more than others.
The litmus test of pricing strategies in revealing a business's grip on value.
Strategies to fortify your Value Capture.
Methods to measure and anticipate the decline of Value Capture.
The possibility of a business to be exceptional at creating value yet fail at capturing it.
Peter Thiel reveres this as a business’s vital yet often overlooked dimension, highlighted in his talks and immortalized in his writings. "Zero to One" is a testament to his belief that creating value is insufficient unless you can claim a share.
Through this series, we aim to equip you with the foresight to build a business that not only generates value but also secures it against the tides of competition and market dynamism. Because in the end, it's not about how much value you create but how much you get to keep.
Join me on this exploration, where we don't just aspire to build businesses but to craft legacies of value.
To enduring success,
Johan Trip