A Safer Internet Business Model
April 14th, 2008 | Categories: launch, marketing, markets, strategy, trends, usabilityHere’s a thought for all the serial entrepreneurs out there: next time you’re looking for “the next big thing”, look no further than “the current mediocre thing”. I’ve come to the conclusion that rather than trying to reinvent the wheel with a completely new business model, it is easier to modify a recently-adapted idea. This will likely yield greater potential success and minimum downside.
Many start-ups are looking to revolutionize their industry with a ground-breaking concept. The potential upside it huge - then again, so is the potential downside. Perhaps a more conservative, yet equally lucrative, model may be a worthy alternative. For example, a company may develop a model similar to XYZ corp, but in BLAH fashion. Obvious, a laggard approach may not always be the best strategy, especially if the leader in the space has already taken hold of the Network Effect.
The advantage to this approach is simple: less financial resources are needed for PR purposes and product education. Expanding further on that, less money is needed for industry education as well. An additional benefit is a minimal learning curve for new users and potential adopters.
This isn’t the sexiest route to follow. VCs aren’t going to rejoice at your less-than-stellar model. Nonetheless, it may have a better chance at profitability and long-term success than a risky, shot-in-the-dark venture that you dreamt up in the shower.
April 15th, 2008 at 2:57 pm
Interesting post. Can you provide a real life example of where you believe this tactic will be successful?
April 16th, 2008 at 11:05 pm
Yeah, I think there are huge opportunities in industries and space where the offerings are overly complicated. Simplification is needed. These spaces include travel, shopping, real estate, and finance, to name a few…
Cheers,
Aidan
April 17th, 2008 at 2:50 pm
So what you’re saying is that an internet startup could be successful if they target the travel, shopping, real estate or finance sectors? I think I was looking to start a conversation with a bit more depth.
April 17th, 2008 at 6:51 pm
Not necessarily. I think there are lots of other industries and spaces out there in need of simpler offerings.
-Aidan
April 17th, 2008 at 10:18 pm
You obviously misinterpreted my comment. It’s no great secret that most successful business ideas are derived from a similar previously successful idea. In my comment I was expressing a desire to dig a little deeper and identify some examples of real companies and service offerings who’s concept could be pared down yet made profitable by an internet startup.
April 19th, 2008 at 1:34 pm
I would argue that Oprius (http://www.oprius.com/) is a great example of this. Contact Management Software has been around forever. However, Oprius took that concept and made it simple. This opened them up to millions of potential customers that Microsoft CRM could never touch.
The same could be said for Basecamp (http://www.basecamphq.com/) vs Microsoft Project.
April 20th, 2008 at 5:33 pm
Erik - A couple companies that I believe have complicated offerings that can be pared down to create more vertical opportunities include Amazon and Expedia…
Cheers,
Aidan