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The Gorilla Game: Picking Winners in High Technology
The Possibilities Are Staggering:
Had you invested $10,000 in Cisco Systems back in early 1990, your investment would now be worth $3,650,000
Similarly, a $10,000 investment made in Microsoft in 1986 would be valued at more than $4,721,000 today
$10,000 invested in Yahoo! in 1996 would today be worth $317,000
How do you get in on those deals--especially if you're not a Silicon Valley insider? How do you buy the high-tech win-ners and avoid the losers? How do you find the Yahoo!s, Microsofts, and Ciscos of tomorrow?
The answers are here, in this newly revised edition of the national bestseller The Gorilla Game. The book reveals the dynamics driving the market for high-tech stocks and out-lines the forces that catapult a select number of compa-nies to "gorilla" status--dominating the markets they serve in the way that Yahoo! dominates internet portals, Microsoft dominates software operating systems, and Cisco dominates hardware for data networks.
Follow the rules of The Gorilla Game and you will learn how to identify and invest in the "gorilla candidates" early on--while they are still fighting for dominance, and while their stocks are still cheap. When the dust clears and one company clearly attains leadership in its market, you'll reap the enormous returns that foresighted investors in high-tech companies deserve.
This new edition of The Gorilla Game has been updated and revised throughout, with new focus and new insights into choosing the internet gorillas--the companies that are destined to dominate internet commerce.
Bestselling author Geoffrey A. Moore is one of the world's leading consultants in high-tech marketing strategy. Here you'll find his groundbreaking ideas about tech-nology markets that made his previous books bestsellers, combined with the work of Paul Johnson, a top Wall Street technology analyst, and Tom Kippola, a high-tech consul-tant and highly successful private investor. Together they have discovered and played the gorilla game and now give readers the real rules for winning in the world of high-tech investing.
Step by step you'll learn how to spot a high-tech market that is about to undergo rapid growth and development, how to identify and spread investments across the potential gorillas within the market, and how to narrow your investments to the single, emerging leader--the gorilla--as the market matures.
High-tech investing can be extremely risky, but investors who learn to play the gorilla game can avoid many of the traps and pitfalls and instead start capitalizing on untold profits. Personal wealth is only a gorilla game away.
Had you invested $10,000 in Cisco Systems back in early 1990, your investment would now be worth $3,650,000
Similarly, a $10,000 investment made in Microsoft in 1986 would be valued at more than $4,721,000 today
$10,000 invested in Yahoo! in 1996 would today be worth $317,000
How do you get in on those deals--especially if you're not a Silicon Valley insider? How do you buy the high-tech win-ners and avoid the losers? How do you find the Yahoo!s, Microsofts, and Ciscos of tomorrow?
The answers are here, in this newly revised edition of the national bestseller The Gorilla Game. The book reveals the dynamics driving the market for high-tech stocks and out-lines the forces that catapult a select number of compa-nies to "gorilla" status--dominating the markets they serve in the way that Yahoo! dominates internet portals, Microsoft dominates software operating systems, and Cisco dominates hardware for data networks.
Follow the rules of The Gorilla Game and you will learn how to identify and invest in the "gorilla candidates" early on--while they are still fighting for dominance, and while their stocks are still cheap. When the dust clears and one company clearly attains leadership in its market, you'll reap the enormous returns that foresighted investors in high-tech companies deserve.
This new edition of The Gorilla Game has been updated and revised throughout, with new focus and new insights into choosing the internet gorillas--the companies that are destined to dominate internet commerce.
Bestselling author Geoffrey A. Moore is one of the world's leading consultants in high-tech marketing strategy. Here you'll find his groundbreaking ideas about tech-nology markets that made his previous books bestsellers, combined with the work of Paul Johnson, a top Wall Street technology analyst, and Tom Kippola, a high-tech consul-tant and highly successful private investor. Together they have discovered and played the gorilla game and now give readers the real rules for winning in the world of high-tech investing.
Step by step you'll learn how to spot a high-tech market that is about to undergo rapid growth and development, how to identify and spread investments across the potential gorillas within the market, and how to narrow your investments to the single, emerging leader--the gorilla--as the market matures.
High-tech investing can be extremely risky, but investors who learn to play the gorilla game can avoid many of the traps and pitfalls and instead start capitalizing on untold profits. Personal wealth is only a gorilla game away.
384 pages, Hardcover
First published January 1, 1998
About the author
Geoffrey A. Moore
33 books378 followersGeoffrey Moore is an author, speaker, and advisor who splits his consulting time between start-up companies in the Mohr Davidow portfolio and established high-tech enterprises, most recently including Salesforce, Microsoft, Intel, Box, Aruba, Cognizant, and Rackspace.
Moore’s life’s work has focused on the market dynamics surrounding disruptive innovations. His first book, Crossing the Chasm, focuses on the challenges start-up companies face transitioning from early adopting to mainstream customers. It has sold more than a million copies, and its third edition has been revised such that the majority of its examples and case studies reference companies come to prominence from the past decade. Moore’s most recent work, Escape Velocity, addresses the challenge large enterprises face when they seek to add a new line of business to their established portfolio. It has been the basis of much of his recent consulting.
Irish by heritage, Moore has yet to meet a microphone he didn’t like and gives between 50 and 80 speeches a year. One theme that has received a lot of attention recently is the transition in enterprise IT investment focus from Systems of Record to Systems of Engagement. This is driving the deployment of a new cloud infrastructure to complement the legacy client-server stack, creating massive markets for a next generation of tech industry leaders.
Moore has a bachelors in American literature from Stanford University and a PhD in English literature from the University of Washington. After teaching English for four years at Olivet College, he came back to the Bay Area with his wife and family and began a career in high tech as a training specialist. Over time he transitioned first into sales and then into marketing, finally finding his niche in marketing consulting, working first at Regis McKenna Inc, then with the three firms he helped found: The Chasm Group, Chasm Institute, and TCG Advisors. Today he is chairman emeritus of all three.
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Moore’s life’s work has focused on the market dynamics surrounding disruptive innovations. His first book, Crossing the Chasm, focuses on the challenges start-up companies face transitioning from early adopting to mainstream customers. It has sold more than a million copies, and its third edition has been revised such that the majority of its examples and case studies reference companies come to prominence from the past decade. Moore’s most recent work, Escape Velocity, addresses the challenge large enterprises face when they seek to add a new line of business to their established portfolio. It has been the basis of much of his recent consulting.
Irish by heritage, Moore has yet to meet a microphone he didn’t like and gives between 50 and 80 speeches a year. One theme that has received a lot of attention recently is the transition in enterprise IT investment focus from Systems of Record to Systems of Engagement. This is driving the deployment of a new cloud infrastructure to complement the legacy client-server stack, creating massive markets for a next generation of tech industry leaders.
Moore has a bachelors in American literature from Stanford University and a PhD in English literature from the University of Washington. After teaching English for four years at Olivet College, he came back to the Bay Area with his wife and family and began a career in high tech as a training specialist. Over time he transitioned first into sales and then into marketing, finally finding his niche in marketing consulting, working first at Regis McKenna Inc, then with the three firms he helped found: The Chasm Group, Chasm Institute, and TCG Advisors. Today he is chairman emeritus of all three.
Visit The Infinite Staircase Website
Twitter Account for The Infinite Staircase Website
Facebook Account for Geoffrey Moore
Geoffrey Moore Main Site
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Displaying 1 - 8 of 8 reviews
December 30, 2020
I love the framework outlined in this book for playing in high tech growth markets. It’s very intuitive and rational with a strategy that looks to take advantage of growth while limiting downside.
It was also cool to read through this book and think about the ways in which this framework could be applied today.
The one thing I wish they had done more of is relative valuation. Because this was written before the dot com bubble, you get the idea that valuations don’t apply to these companies. If this book had been written in 2000, I wonder if they would’ve added some commentary on that. Interestingly, at the end of 2020 it appears we might possibly be in another bubble 20 years later.
It was also cool to read through this book and think about the ways in which this framework could be applied today.
The one thing I wish they had done more of is relative valuation. Because this was written before the dot com bubble, you get the idea that valuations don’t apply to these companies. If this book had been written in 2000, I wonder if they would’ve added some commentary on that. Interestingly, at the end of 2020 it appears we might possibly be in another bubble 20 years later.
August 7, 2024
I was pleasantly surprised by this late 90's investment book written at the peak of a tech bubble. It is better than just buy growth mantra, and there is an actual investing framework with a focus on B2B tech businesses. Though there is zero focus on valuation, the authors are not too far removed from the quality at any price school of investors who seem to be ever-present in the contemporary investment circles. I also enjoyed reading through the case studies and getting a history lesson on a subset of 1980-90's tech.
At the core of their framework is the GAP/CAP focus -- GAP (Competitive Advantage Gap), the more quantitative, represents the company's potential to generate superior earnings based on making a superior offering and CAP (Competitive Advantage Period), the more qualitative, represents the sustainability of the competitive advantage of any given company.
The authors present case studies and discuss the timing of investments, and when to fold, and when to press... In the case of public markets, their advice is to invest into tech companies after they crossed the adoption chasm. For application software, suggestion is to then focus on investing when early pragmatic customers adopt ("bowling alley"), and in case of enabling technology (such as databases or networking hardware) to do so slightly later when the S curve is on a steep incline ("tornado"). With application software, their advice is to hold a group of companies and ride the wave until growth decelerates with no long term commitments, whereas in the case of enabling technologies to start by investing in a group and then consolidate around one "gorilla" and basically hold that gorilla indefinitely, until a proven substitution threat emerges in earnest.
I think a lot of opportunity to do this kind of investing at early parts of an S-curve has receded into the vc and growth p/e world, since rarely do we observe publicly traded companies grow revenues 100%+ y-o-y. However, thoughts around what makes gorilla win and why some markets may not have the gorilla but rather a "royalty game" structure (with lower upside opportunity for one winner) seem relevant to this day. The authors defined the gorilla company as one that relies on proprietary architectural control with high switching costs. Whereas the royalty game is more about best execution. We now know there is more to tech than those set-ups, but authors were informed by tech of their time and also needed to keep the book focused.
Some of their observations ring true to this day and are worth highlighting:
- "Investing is all about understanding the competitive advantage. That is the underlying thesis of the gorilla game."
- "The impact of better execution on stock price, assuming no change to the Competitive Advantage Period, is inherently modest."
- "Most news has nothing to do with the gorilla game. Learn to ignore it."
PS
One way to judge the effectiveness of this book is by where its authors have ended up 20+ years later.
1) Geoffrey Moore is alive and well, still publishing, consulting, and even making podcast appearances.
2) Paul Johnson -- got into some hot water with the SEC, but seems to have landed on his feet ok. https://www.nytimes.com/2006/07/26/te... https://cfany.org/speaker-organizer/p...
3) Tom Kippola -- seems to be in a low key VC game.
https://svdcapital.com/team/tom-kippola/
At the core of their framework is the GAP/CAP focus -- GAP (Competitive Advantage Gap), the more quantitative, represents the company's potential to generate superior earnings based on making a superior offering and CAP (Competitive Advantage Period), the more qualitative, represents the sustainability of the competitive advantage of any given company.
The authors present case studies and discuss the timing of investments, and when to fold, and when to press... In the case of public markets, their advice is to invest into tech companies after they crossed the adoption chasm. For application software, suggestion is to then focus on investing when early pragmatic customers adopt ("bowling alley"), and in case of enabling technology (such as databases or networking hardware) to do so slightly later when the S curve is on a steep incline ("tornado"). With application software, their advice is to hold a group of companies and ride the wave until growth decelerates with no long term commitments, whereas in the case of enabling technologies to start by investing in a group and then consolidate around one "gorilla" and basically hold that gorilla indefinitely, until a proven substitution threat emerges in earnest.
I think a lot of opportunity to do this kind of investing at early parts of an S-curve has receded into the vc and growth p/e world, since rarely do we observe publicly traded companies grow revenues 100%+ y-o-y. However, thoughts around what makes gorilla win and why some markets may not have the gorilla but rather a "royalty game" structure (with lower upside opportunity for one winner) seem relevant to this day. The authors defined the gorilla company as one that relies on proprietary architectural control with high switching costs. Whereas the royalty game is more about best execution. We now know there is more to tech than those set-ups, but authors were informed by tech of their time and also needed to keep the book focused.
Some of their observations ring true to this day and are worth highlighting:
- "Investing is all about understanding the competitive advantage. That is the underlying thesis of the gorilla game."
- "The impact of better execution on stock price, assuming no change to the Competitive Advantage Period, is inherently modest."
- "Most news has nothing to do with the gorilla game. Learn to ignore it."
PS
One way to judge the effectiveness of this book is by where its authors have ended up 20+ years later.
1) Geoffrey Moore is alive and well, still publishing, consulting, and even making podcast appearances.
2) Paul Johnson -- got into some hot water with the SEC, but seems to have landed on his feet ok. https://www.nytimes.com/2006/07/26/te... https://cfany.org/speaker-organizer/p...
3) Tom Kippola -- seems to be in a low key VC game.
https://svdcapital.com/team/tom-kippola/
September 16, 2018
Solid fundamentals but needs to be updates so it doesn’t feel dated
I’m a huge Geoffrey Moore fan having read “Crossing The Chasm”, “Inside The Tornado” and “Escape Velocity”. This book covers a framework for how to identify early winners in new technology sectors and then double down on those bets over time to maximize investment returns. It’s not about picking out a single stock 10 years in advance, but rather identifying the leading contenders in a space, investing in a basket of all of them, and then occasionally making tweaks as some stumble and others soar.
The book seems to have held up well having been written in the mid-1990s and it’s predictions and analysis of certain companies that are now still dominating has held up (Cisco, Oracle, Microsoft, Amazon), despite the examples now feeing dated (3Com, AOL, Yahoo, etc) in hindsight. However again, it’s not about having a crystal ball to pick a single stock that’ll be the winner in 10 years, but a systematic approach and framework for how to identify when a tornado is actually happening vs false starts, which companies will participate in the tornado, how to hedge and ride out the sector as a whole, and how to groom the basket of stocks down the the ones that will become the gorillas (or Godzillas) over time.
Highly recommended for an under-the/radar investment approach that itself is an overlooked bargain value in a world where everyone overthinks or worse, make random predictions without analyzing the strategic and operational metrics necessary to identify winning contestants in the gorilla game.
I’m a huge Geoffrey Moore fan having read “Crossing The Chasm”, “Inside The Tornado” and “Escape Velocity”. This book covers a framework for how to identify early winners in new technology sectors and then double down on those bets over time to maximize investment returns. It’s not about picking out a single stock 10 years in advance, but rather identifying the leading contenders in a space, investing in a basket of all of them, and then occasionally making tweaks as some stumble and others soar.
The book seems to have held up well having been written in the mid-1990s and it’s predictions and analysis of certain companies that are now still dominating has held up (Cisco, Oracle, Microsoft, Amazon), despite the examples now feeing dated (3Com, AOL, Yahoo, etc) in hindsight. However again, it’s not about having a crystal ball to pick a single stock that’ll be the winner in 10 years, but a systematic approach and framework for how to identify when a tornado is actually happening vs false starts, which companies will participate in the tornado, how to hedge and ride out the sector as a whole, and how to groom the basket of stocks down the the ones that will become the gorillas (or Godzillas) over time.
Highly recommended for an under-the/radar investment approach that itself is an overlooked bargain value in a world where everyone overthinks or worse, make random predictions without analyzing the strategic and operational metrics necessary to identify winning contestants in the gorilla game.
March 19, 2021
واقعا محشره کتاب دلم شکار گوریل در تورنیدو خواست
من کامل زندگی نامه استیو جابز والتر ایزاکسون را خوانده بودم یک کلمه کتاب به کتاب م��رد علاقه ی تورنیدو جابز اشاره نکرده. اگر میخواهید بدانید که اپل و مایکروسافت چیستند باید حتما کتابهای جفری مور را بخوانید
من کامل زندگی نامه استیو جابز والتر ایزاکسون را خوانده بودم یک کلمه کتاب به کتاب م��رد علاقه ی تورنیدو جابز اشاره نکرده. اگر میخواهید بدانید که اپل و مایکروسافت چیستند باید حتما کتابهای جفری مور را بخوانید
December 14, 2014
Written in 1997 and updated in 1999, The Gorilla Game outlines investing in a certain kind of companies -- those that have a sustainable competitive advantage by virtue of having an ecosystem that sustains them.
The book is interesting in someways -- going over the history of how some dominant companies got to be that way, especially Oracle and Cisco.
The prescription about how to actually invest in these companies are, remarkably, devoid of discussion of the price you pay -- hence much of the advice is quite flawed. Instead, the argument relies on the market undervaluing the dominant player and overvaluing the others, because it does not properly price in the winner-take-most dynamic. As many investors of that era learned, simply holding the least overvalued company can still be a very disappointing experience.
That said, good insights are offered about the dynamics of the gorilla companies -- the customers pick them since they are the leader, and the VARs of various stripe resent their pricing and market power but still support their dominance since they need a platform to deliver their value.
Explaining the lock-in effects of router protocols and management was helpful in improving my understanding of the power of Cisco of that era.
The chapters on how to spot the beginning of hypergrowth (a tornado market) and the emergence of a gorilla in it are helpful.
The book loses some of the crispness by claiming there are gorilla dynamics in the application software niches -- although the strict definition of supporting ecosystem does not seem to apply well there.
The book has a few other interesting pointers -- for instance, to pay attention to news about companies having entered the tornado, not the earlier articles about what might be.
Written with typical Geoffrey Moore wit and irreverence, there are many sharp insights, along with occasional lack of rigor.
The final chapter, on how to deal with Internet companies, was added for the revised edition. Interestingly, those who applied its ranking scheme to Priceline.com, (whom the book mentions but does not rank) would perhaps have done quite well.
Overall, worth reading for any connoisseur of moats, and for deep value investors looking to understand the reasonable thoughts from the "other" side.
The book is interesting in someways -- going over the history of how some dominant companies got to be that way, especially Oracle and Cisco.
The prescription about how to actually invest in these companies are, remarkably, devoid of discussion of the price you pay -- hence much of the advice is quite flawed. Instead, the argument relies on the market undervaluing the dominant player and overvaluing the others, because it does not properly price in the winner-take-most dynamic. As many investors of that era learned, simply holding the least overvalued company can still be a very disappointing experience.
That said, good insights are offered about the dynamics of the gorilla companies -- the customers pick them since they are the leader, and the VARs of various stripe resent their pricing and market power but still support their dominance since they need a platform to deliver their value.
Explaining the lock-in effects of router protocols and management was helpful in improving my understanding of the power of Cisco of that era.
The chapters on how to spot the beginning of hypergrowth (a tornado market) and the emergence of a gorilla in it are helpful.
The book loses some of the crispness by claiming there are gorilla dynamics in the application software niches -- although the strict definition of supporting ecosystem does not seem to apply well there.
The book has a few other interesting pointers -- for instance, to pay attention to news about companies having entered the tornado, not the earlier articles about what might be.
Written with typical Geoffrey Moore wit and irreverence, there are many sharp insights, along with occasional lack of rigor.
The final chapter, on how to deal with Internet companies, was added for the revised edition. Interestingly, those who applied its ranking scheme to Priceline.com, (whom the book mentions but does not rank) would perhaps have done quite well.
Overall, worth reading for any connoisseur of moats, and for deep value investors looking to understand the reasonable thoughts from the "other" side.
April 1, 2013
good insights. Always best to be the winner as it provides control.
September 8, 2015
See my review here: The Gorilla Game
July 13, 2014
Little dated now but good at describing how to spot solid companies
Displaying 1 - 8 of 8 reviews