Awesome thread! Of course, if all entrepreneurs were easily scared off, we'd still be living in the dark ages.

This makes me think of a book I'm reading at the moment, The Economy of Cities. The author argues that established, highly efficient, large businesses have their place in the economy, but it is small start up firms that are the driving force behind true economic growth. It takes a hotbed of networked small firms coming up with new work, building on old ideas and cannibalizing technology to move an economy forward. This, for instance, is why Detroit was such a marvelous city up until it turned into a few large auto makers dominating the auto industry. Up until that point the Detroit auto industry was a network of small firms and amateurs working out of their home garages, and they invented the modern automobile. As soon as the economy shifted toward mass production they made themselves redundant, because any city in the world with high industrial capacity can engage in high volume manufacturing. They can't, however, imitate imagination and innovation. Of course, this comes at a price: a high rate of failure and low efficiency. But, the author of The Economy of City argues that these are actually the signs of a strong city economy.

More here: http://attackthesystem.com/2011/06/21/more-on-the-economy-of-cities/