In the 1890s, a University of Chicago botanist named Henry Chandler Cowles took a walk along the Indiana Dunes on the southern shore of Lake Michigan and noticed something that would reshape ecology. The dunes formed a gradient: nearest the lake, only beach grass. A few hundred meters inland, cottonwoods. Further still, pine forests. And deepest inland, towering oak-maple-beech forests that had stood for centuries.
Cowles realized he wasn't just looking at different plants. He was looking at time, laid out in space. Each zone represented a stage in a process ecologists would call succession — a predictable sequence where one community of organisms builds the conditions for the next, then gets replaced by it.
If you've spent any time watching markets evolve, that sequence should sound familiar.
The Pioneer's Paradox
Pioneer species are the first organisms to colonize barren ground. After a volcanic eruption, a glacier retreating, a wildfire clearing a mountainside — pioneers show up before anyone else. Lichens on bare rock. Fireweed in ash. Beach grass on raw sand.
They share a specific set of traits: fast reproduction, high tolerance for brutal conditions, short lifespans, and — this is the critical one — they build soil. Lichens secrete acids that break down rock into the mineral base of soil. Mosses trap organic matter. Early grasses add root structure. Pioneer species don't just survive harsh conditions; they transform those conditions into something richer. Something they themselves can't use.
Startups do the same thing, and we have the receipts.
When Reed Hastings launched Netflix in 1997 as a DVD-by-mail service, there was no market for "streaming entertainment." There wasn't even broadband in most homes. Netflix was a pioneer colonizing barren landscape — a bet that physical media would give way to digital delivery. For years, Netflix looked like a modest, slightly inferior alternative to Blockbuster, which had 9,000 locations and was pulling $800 million annually in late fees alone.
But Netflix was building soil. Every DVD shipped trained a customer to choose from a screen instead of browsing shelves. Every recommendation algorithm refined a model of viewer behavior. Every negotiation with studios established the licensing frameworks that digital distribution would need. By the time Netflix pivoted to streaming in 2007, it was growing in soil it had spent a decade preparing.
Salesforce did the same in enterprise software. In 1999, Marc Benioff's "No Software" campaign looked quixotic against Oracle and SAP — entrenched players with decades of on-premise installations protecting their position. But Salesforce was pioneering the SaaS model, building the soil of cloud infrastructure, subscription billing, and browser-based enterprise UX. By 2018, Salesforce held 20% of the global CRM market — double SAP's share and triple Oracle's. The on-premise forest had been replaced by a cloud-native ecosystem, growing in soil the pioneer prepared.
Amazon's trajectory is the most vivid example. Jeff Bezos started with books in 1994 — colonizing the raw, barren landscape of e-commerce when most consumers didn't trust putting a credit card into a website. Amazon built logistics networks, payment systems, customer review infrastructure, and eventually cloud computing. AWS, launched in 2006, literally became the soil that the next generation of companies grew in. Netflix, Airbnb, Dropbox, Slack — all pioneers in their own domains, all rooted in Amazon's infrastructure. Amazon Prime now enrolls over 100 million U.S. members who spend roughly $800 more annually than non-members. The pioneer became the ecosystem itself.
The Species That Build Their Own Gravediggers
Here's where the ecology metaphor cuts deepest: pioneers almost never become the climax community. Lichens don't become oak trees. Beach grass doesn't become a forest. Pioneer species engineer conditions that favor organisms fundamentally different from themselves — shade-tolerant, slow-growing, long-lived species that can exploit the rich environment pioneers created but pioneers cannot.
After Mount St. Helens erupted in 1980, obliterating 230 square miles, fireweed and prairie lupine colonized within two years. By 2020 — forty years later — young forests had established. But the fireweed was long gone. It had done its job. The soil it built now supported species that shaded it out.
Markets show the same pattern with striking regularity. Myspace pioneered social networking and peaked at 75 million users. But Myspace was a pioneer species — fast, scrappy, tolerance for chaos. Facebook was the shade-tolerant climax species: slower to move (Harvard-only for its first two years), more structured, better optimized for the environment Myspace had created. Myspace built the soil of social networking behavior — profile creation, friend requests, content sharing — and Facebook grew in it.
Netscape pioneered web browsing and went public in 1995 at a $2.9 billion valuation. It built the soil of mass internet adoption. But it was a pioneer species — high metabolism, fast burn. The climax species that grew in Netscape's soil were Google and eventually Chrome. The Blackberry pioneered smartphone email. Palm pioneered the PDA. Napster pioneered digital music distribution. Each built soil — behavioral patterns, infrastructure, customer expectations — that a different organism would dominate.
Apple even demonstrated succession within its own organism. The iPod held roughly 75% of the portable music player market from 2003 to 2010 — a climax species by any measure. But Apple itself introduced the disturbance: the iPhone. The iPod had built the soil of digital music behavior, iTunes familiarity, and the expectation that a pocket device should be beautiful and intuitive. The iPhone grew in that soil and shaded the iPod out. By 2014, the iPod was effectively dead, killed by its own ecosystem's next successional stage. Most companies can't even imagine doing this to themselves, which is precisely why most companies don't survive succession events.
This isn't failure. It's succession. And understanding it changes how you think about strategy.
Holling's Infinity Loop
In the 1970s, Canadian ecologist C.S. Holling developed a framework called the adaptive cycle that maps succession onto a repeating four-phase loop. It's usually drawn as a figure-eight or infinity symbol, and it connects ecological and economic systems more rigorously than any analogy:
Exploitation (r): Pioneers colonize. Startups launch. Resources are abundant and competition is low. Growth is rapid, chaotic, experimental. This is 2005-era social media, 2009-era mobile apps, 2023-era generative AI.
Conservation (K): Climax community establishes. Incumbents consolidate. Resources get locked into efficient structures. Growth slows; optimization replaces exploration. This is Google in search, Microsoft in enterprise, Amazon in e-commerce — tight, efficient, dominant.
Release (Omega): Disturbance hits. Fire, flood, pandemic, technological disruption. The tightly coupled system shatters. Resources trapped in rigid structures are suddenly freed. Blockbuster's bankruptcy in 2010. Kodak's collapse after 130 years. The 2008 financial crisis that freed capital and talent into fintech.
Reorganization (Alpha): The soil is fertile with freed resources — talent, capital, customer attention, technical infrastructure. New pioneers colonize. The loop begins again.
Holling's deepest insight was what he called panarchy: these loops operate at multiple scales simultaneously. A single startup's failure is an Alpha-phase event that feeds the next round of innovation. An entire industry's disruption is an Omega-phase event at a larger scale. Small, fast loops (individual companies) provide novelty and experimentation. Large, slow loops (industries, economies) provide memory and stability. The system is never at one phase — it's a nested set of loops, each turning at its own speed.
The Sweet Spot of Chaos
Perhaps the most counterintuitive finding in succession ecology is the Intermediate Disturbance Hypothesis: species diversity is maximized when disturbance is neither too rare nor too frequent.
Too little disturbance and you get competitive exclusion — the climax species monopolize everything, suppress diversity, and the ecosystem becomes brittle. Too much disturbance and nothing has time to establish — the ecosystem stays in permanent pioneer mode, all weeds and no forests.
The richest, most diverse ecosystems exist at intermediate disturbance levels. Moderate fire regimes. Periodic but not constant flooding. Enough chaos to prevent monopoly, enough stability to allow complexity.
Markets behave the same way. The most innovative, diverse market ecosystems exist where disruption cycles run every five to ten years — frequent enough to prevent permanent incumbency, infrequent enough to let companies build real products and real customer relationships. Silicon Valley's rhythm of roughly decadal platform shifts (PC, web, mobile, cloud, AI) maps onto this pattern. Each shift clears enough canopy to let new pioneers in without destroying the entire forest.
Markets with no disruption become monopolistic and stagnant — think U.S. telecom in the 1970s. Markets with constant disruption can't build anything lasting — think the crypto ecosystem circa 2022, where projects rarely survived long enough to mature past pioneer stage.
And here's the truly sobering finding from the ecological research: stability itself is dangerous. Panarchy researchers have found that preserving ecosystems in pristine, static states causes more damage than protection. Forests where fire is suppressed for decades accumulate so much deadwood that when fire finally comes, it's catastrophic — not a healthy understory burn but a crown fire that kills everything.
Kodak's 130-year dominance didn't make it stronger. It made the eventual disruption more total. Blockbuster's 9,000-store empire didn't create resilience; it created brittleness. The longer a system goes without disturbance, the more catastrophic the eventual disturbance will be. The S&P 500's average company tenure has dropped from roughly 60 years in 1960 to about 20 years today. The fire cycles are speeding up, and that might be healthier than the alternative.
There Is No Climax
Modern ecologists have largely abandoned the concept of the climax community. Cowles's elegant gradient at the Indiana Dunes implied a stable endpoint — the mature oak forest as the final, self-perpetuating community. But decades of research have shown that most ecosystems experience disturbance frequently enough that a true stable endpoint is never reached. What looks like a climax community is just slow change on a timescale longer than we've been watching.
The business equivalent is the myth of the permanent market leader. There is no company that achieves permanent dominance. IBM seemed permanent in mainframes. Microsoft seemed permanent in operating systems. Google seems permanent in search. But succession doesn't stop. It just sometimes runs on timescales that exceed a quarterly earnings cycle or a CEO's tenure.
Amazon is the most interesting case because it demonstrates something rare: a pioneer species that managed to become a climax species. Starting as a bookstore colonizing e-commerce's barren landscape, it built infrastructure so deep — logistics, AWS, Prime — that it transitioned into the dominant canopy. But even Amazon now creates the soil for its own challengers. Shopify grows in Amazon's e-commerce soil. Vercel and Cloudflare grow in AWS's cloud soil. The infrastructure Amazon built enables the very companies that compete with it. Each phase creates the conditions for its own replacement.
So What Are You Building?
If you're building a company — or a product, or a career — the succession framework suggests a question worth sitting with: are you a pioneer species or a climax species? And do you know which one your market needs right now?
If the landscape is barren — new technology, undefined market, no established patterns — pioneer traits win. Move fast, tolerate chaos, build soil. But know that building soil means building the conditions for someone else to thrive. The question isn't whether that will happen; it's whether you can evolve from pioneer to something that persists in the forest you're creating.
If the landscape is mature — established market, dominant players, optimized operations — look for where disturbance is coming. Every Conservation phase carries the seeds of its own Release. The companies that survive the transition aren't the ones with the thickest trunks. They're the ones that maintained enough pioneer DNA to recolonize after the fire.
And if you're in the middle — moderate disturbance, diversity still high, no single dominant player — you might be in the luckiest position of all. The Intermediate Disturbance Hypothesis says your ecosystem is at peak innovation. The soil is rich, the canopy isn't closed, and there's room for both pioneers and future giants.
Cowles saw it all in a walk along the dunes: time written in space, each community building the ground for the next, nothing permanent, everything in motion. A hundred and thirty years later, the pattern holds. The only question is where you are on the gradient — and what you're building in the soil.
Sources: Cowles/Indiana Dunes (UChicago News); Iansiti & Levien, "Strategy as Ecology" (HBR, 2004); Holling's adaptive cycle (Resilience Alliance); Intermediate Disturbance Hypothesis; CB Insights innovation frameworks; Gunderson & Holling, Panarchy (2002); Biology LibreTexts succession timelines.
Succession runs on trust infrastructure. Every successional stage depends on what the previous one built into the soil. In the AI agent ecosystem, that soil is trust — cryptographic provenance, verifiable track records, and graduated handshake protocols that let new entrants prove themselves without a decade of brand recognition. The pioneers building that infrastructure today are shaping which species thrive next.
