The startups that succeed beyond their founders’ wildest dreams are the often the ones that hit the sweet spot between being too early and too late. When around 90% of all technology-based startups eventually fail, knowing where that sweet spot is and how to hit it might be the difference between living and dying in the entrepreneurial sense.
Timing is the single most important determining factor in your startup’s future success or failure.
When your company launches matters. It is not just about what technologies and devices are available to you (although that definitely matters), but what is happening in the broader market, the overall economic climate, and how open society currently is to change and new ideas.
The Entrepreneurial Sweet Spot
Arrive on the scene too early, and you’ll have to educate an often resistant consumer base.
On the contrary – arrive too late and you’ll have to deal with a glut of competitors, an over-saturated market, and a consumer base that might just be totally over what you offer.
That’s when a small company can become one of the incredible success stories that have are almost mythic in the startup community. So, how do you get there?
By knowing what the people want – and giving it to them.
It’s Not the Technology – It’s the People
You’ve probably heard this saying before – it’s not the technology that is the problem, it is the people using it. That can be doubly true in the case of startups, since you are introducing people to a new way to use technology, and to new concepts and behaviors as well.
People generally resist change.
So, hitting the market or launching at a time when people are somewhat accustomed to new technology but not yet bored with it or moving on to the next thing is key. In fact, in regard to technology, you may want to create and build your startup during the first wave of adoption, but hold back your launch until the market is ready.
You’ll need to be honest about this, even if it is difficult. It is human nature to want to share what you’re excited about – to shout it from the rooftops, so to speak – but if the audience isn’t ready, you’ll want to wait till the timing is right.
Successful startups also often provide the “bump” or the factor that makes adopting new tech or concepts easier. They get people over the hump, so to speak, and make something that was primarily the province of geeks and nerds part of the mainstream. But the people have to be ready and looking for change first, or at least open to being educated about new things.
Launching Your Business Too Early
Being too early or too new can be just as much as a momentum killer as being too late. After all, if you arrive on the market before your audience’s collective mindset has adjusted to the idea of the new technology or concept that you’re introducing, they’ll require a certain amount of education. While it is indeed possible, that could be tough to deliver via marketing or promotional efforts.
Simply put, if consumers aren’t ready for your idea, they simply won’t adopt it. But what makes people ready for a new idea? An increasing frustration with the status quo, an economic shift in either direction causing changes in people’s lives, the introduction of new technologies, major world-changing events, or even something as simple as celebrities or key public figures taking a shine to a certain platform can all get people in the mood for something new and different.
Why You Need To Address Current Problems
It is not enough for your company to solve an important problem. The problem has to be a current concern of your audience – it has to be at the forefront of their minds.
You have to solve an immediate problem.
For instance, AirBnB launched in 2008, at the peak of the recent recession when many people could have definitely used some extra cash – so the prospect of saving money when traveling as well as the ability to rent out any extra space in their own properties was pretty appealing.
And people’s desire or need to augment their income during a recession may have pushing AirBnB past the tipping point, especially because its main downside or potential roadblock to success was the fact that people just might not be comfortable renting out space in their private homes.
So basically, AirBnB succeeded by addressing a current problem – they hit the sweet spot by solving an immediate problem for most people – finding somewhere cheap to stay and/or getting some extra cash by renting out their superfluous space.
Providing Current Solutions
While advances in technology are usually positive changes, they can also cause unexpected problems to arise or create new complications for people to deal with, especially for those who aren’t early adopters or inclined to tinker with new tech.
Therefore, when new technologies are introduced and begin taking hold in the market, people start to look for solutions that help them adapt to the changes, enhance the capabilities of new hardware or software, and generally make things easier. And this is where startups and companies can succeed by offering solutions that coincide with the growth of new tech.
Companies that do this aren’t finding customers for their products, they are creating products for existing customers by fixing problems – in this case, problems created by technology. Or they are building upon new technology and making it easier to use, more powerful, or simply more fun or interesting.
YouTube is a great example of this because they took a challenge – uploading, sharing, and watching videos online right in your browser – and made it dead simple for the average user. How did they do it?
Check back for our next blog – we examine the winners and losers of timing new companies.
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