Industries have a life cycle just like humans . Like a person’s childhood, teenage years, adulthood and golden years, industries have distinct life stages. A local example is the Nantucket whaling industry. Let’s review the lifecycle.
1659: Nantucket settled.
1752: Start up stage. Whaling voyages begin. The market for clean burning whale oil is small but growing. Industry profits are negative and large amounts of capital are required to build ships and train mariners.
1760-1789: Growth stage. In this stage capital requirements are still high, but sales grow rapidly and profits are positive.