how to start a company in tough areas
So let’s say you have a good new idea for a new version of Zillow, or a new YouTube. Should you go for it?
On one side you have your passion and fire towards the idea. You may have a few new tricks up your sleeves that the established businesses do not have implemented. On the other side you have all your friends asking you “yes but what will you do different” and investor asking you to do “10x better”.
How do you do 10x better than YouTube? 10x the videos? 10x the users? 10x the profits? Oh well…
The question “what is different” may be more sensible — how do you displace the aging elephants in favor of your tiny website? What is new?
maybe just the name
Maybe it is just your new business name, shouldn’t it attract more visitor, tired of the old website? After all we all crave new things, right? A new car every 1–2 years, a new house, a new kitchen. How can be content with the same FaceBook for 15+ years? Or the same Twitter? Partly is the network effect, the amount of “stuff” that is already there in the old website.
But I think the reason we do not see more powerful clones of the old elephants is because everyone is scared to invest and to support your new site or idea. How typical! — after all the odds are not in your favor. Yet the odds of a startup are never in your favor.
the unreasonable [wo]man
Yet nothing would change and we would all be stuck with the past if it was not for the unreasonable person that wants to do it anyway! After all we already witnessed another Facebook: Twitter. Or a new YouTube: TikTok. These new ideas came up against the elephants and found their place. Twitter came up when the other elephant was young, TikTok when it other elephant was old. In both case we have an example of success!
well it is not so unreasonable after all
If these new sites succeeded against the odds, why not your idea? It is all about marketing. Marketing starts when you put your startup pitch together. Can you convince people of your mission? Of the new horizons and new advantages. How did explorers convince workers to go with them to find Eldorado? The promise of gold? Fame?
With investors it is the same story: promise gold and fame. But during your first 1–2 years all is just a promise that you have to make and visualize.
Marketing is a huge issue in promoting a new site. I bet investor cry at the cost of marketing a new social network like Clubhouse. Maybe so, but marketing these days can also be easier, since we have social networks in place and news travels fast if is worth it.
And you have seen ads for new social network clones, new Zillow, new YouTube — what made you decide to try one or not? Most of the times we want the shiny new toy, it is in our nature. That is in favor of your idea and your tiny new website.
One can pull out thousand of economics articles on how your new site is a bad idea, or a good idea. One can find lots of psych articles about how you would favor the new, or stick to the old.
But my feeling is that it is all about your story, and who you tell it to. And how much they believe it. After all a new YouTube is not risky. The concept, business plan and revenue is all well documented. Even if you capture 5% of the market, it is still a B$ business.
No, it is all about your story. Some people believed in TikTok, or Clubhouse, and some were right and some wrong. It is a bet like any other.
I, for one, would like a new social network, a new YouTube, and new cell-phone OS. FreeMyOS.
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