“Apps are doomed!” - Is this the tech world’s reflexive moment?
There is quite a bit of talk around the fact that it is very hard to build a real business around apps anymore. As an app developer, this is very disturbing, to say the least. The natural response at this time is to alternate every 5 minutes between coding the next feature in your app and thinking about just taking the job in <insert your favorite company>.
I am also a disciple and a big beneficiary of value investing principles. One of the bedrock principles, in simple terms, is not to buy when prices are high (“Bull” markets) and not to sell when prices are low (“Bear” markets). In particular, the key to good returns is to hold (or even better, buy) when prices are low.
In economics, reflexivity refers to the self-reinforcing effect of market sentiment, whereby rising prices attract buyers whose actions drive prices higher still until the process becomes unsustainable and the same process operates in reverse leading to a catastrophic collapse in prices.
Is this our moment of reflexivity? Are we all bearish on the app ecosystem, when the biggest/significant gains from apps is ahead of us?
We will find out in a year or 5. Until then, let’s continue to build and “hold” our position.
