The Gray Hair Speaketh

Advice that is largely Unsolicited..

Why One More of the Same Thing?

I come across startups at variety of forums, like TiE, Mentor Edge, and also directly, when people reach out to me.

And it beats me as to how many times, I keep coming across the same (well, similar) business idea!

I am not referring to two entrepreneurs, coincidentally working on the same brilliant idea. I am referring to entrepreneurs working on an idea, where there are multiple dominant players already in place.

Like the 35th Group Buying business.

Ok, irrespective of my personal feelings about Group Buying (and which you can read in this blog, across more than one posts), assuming that it will be a successful model, what is the different thing you want to do, where as a 35th entrant, you still expect to come out successful / leader??

In the world, there may be examples to prove ANY theory.

So one would try and justify their entry by saying that wasn’t Google a late entrant in the search engine market, and did it still not come out on top?

Just the same way, people like to quote Apple as an example in many different arguments (“Apple does not do much of its own Social Media – the users create the buzz for it. Can we also expect that?” for example).

It needs to be understood that Google or Apple or their business models or their marketing strategies have been exceptions rather than the rule. Also that, fundamentally, both (and others of their kind) have a phenomenal product behind them, and even if they were to not do anything, maybe people would queue up outside their doors, with their cheque books open, looking to purchase!

So first of all, every entrepreneur must not think that he is a Google in the making. Without trying to reduce any ambition or aspiration of the entrepreneur, it is necessary to have feet on the ground, while planning the business strategy, and the positioning.

So while I have seen a bunch of Group Buying plans that did not differentiate from the many existing ones (at least in my mind), recently I came across another business model, that was similar to at least 4 other existing players. All 4 are reasonably well established, and this was the 5th one, entering the same space.

Basically a content vertical, largely ad dependent for revenues, significantly demanding to maintain (at least for good quality). The entrepreneur was trying to show me the differences that he had made in his model, vs the other prevalent ones. Even though he may be right, in pointing those out, to me (and I’d be like a typical consumer for his content), I could not spot those differences, without his explanation. And for a content heavy site,  a typical user is not going to run over it, with a microscope to see those differences.

Why then, would a consumer change habit and come and read content here, instead of the others which he was familiar with? I was not able to see it. And I told the entrepreneur in as less discouraging a tone, as I possibly could.

Of course, entrepreneurs are optimistic, if anything. All of us are. We want to give it our best shot, we feel we have the way to make this happen, we reckon that all things being the same, WE are that difference! So I am sure he is going on with it, and my best wishes to him too. And in a few years, he could have gone past the incumbents and emerged number 1. Again, I would only wish the best for him.

But my point is for one who is planning a business. Where do you start? Do you look for existing successes, and want to try and do one of the same kind? Or you come up with something entirely new, something different, something that the world has not seen just yet?? But which you recognize, would have value?

It is often easier to look at existing successes, and which is perhaps the reason why we see more me-toos, than original ideas. It takes a different vision, a certain imagination, creativity, and then a significant dare, to get into path breaking new thoughts, new ideas, new businesses. And which is why these are rare.

I urge entrepreneurs to look to being different, being unique. More than being clones.

Especially in an online business.

In an offline business, due to various factors, including geographical relevance, many brands of the same business model, can survive. Perhaps be successful too.

Online, everyone’s just a click away. There is no compelling reason (like geography) that a user will land to your site, even when there is a better site, more known, more popular, already around! Have we found a serious second auction site, after Ebay? NO!! Because Ebay is a click away. Why would anyone go anywhere else?!

Think about it.. being different can be more challenging, but can also be more rewarding!

 

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March 13, 2011 - Posted by | Business Model, Startup | , ,

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