$NFLX, $NVO, $HIMS: Lessons on Demand, Scale, and Market Winners

Travis Hoium
09:09

The market favors companies that own demand and scale. $NFLX shows how dominating customer choice beats short-term profits, while $NVO faces pressure from competition and falling prices—highlighting the advantage of demand aggregators like $HIMS.

1. $Netflix(NFLX)$

I didn't understand Netflix $NFLX 10 years ago, but I learned lessons from that mistake.

1. Users > Profits: In a digital business, it's critical to reach scale. Profits don't matter on the path to scale.

2. Delay Taking Price: Margins are low? Who cares! See #1.

3. Suppliers eventually have to bend the knee to the one who owns demand.

You don't say, "I'm going to watch Sony's K-Pop tonight." You say, "I'm going to watch Netflix."

Demand matters above all else.

Owning the customer is the ultimate goal.

The companies we CHOOSE to interact with are the ultimate winners on the market.

2. $Novo-Nordisk A/S(NVO)$

NOVO says sales are going to fall, despite an expanded market.

1. Competition is bringing down price.

2. Lower prices lead to greater adoption (volume).

3. Novo's higher volumes aren't offsetting falling prices.

So, who wins? Clearly, companies like $Hims & Hers Health Inc.(HIMS)$ , who are demand aggregators at scale & who benefit from more supply options and lower prices.

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