Innovation, Or the Complete Lack Thereof, In the Start-up Community
kurt.karmalab.org
kurt.karmalab.org
I wish I had time to build a slavish, mindless clone of Youtube. I would learn a ton of useful things about the data-center requirements for streaming video hosting, the state of the codec universe, Flash programming, how to sell in a crowded marketplace, how to look at another video site and figure out if they're competently designed... I could even practice presenting to crowds of bored investors.
Who cares if the project is ultimately doomed? If you compare it to a college senior-thesis project, instead of to a serious attempt to found a future megacorporation, it all makes a lot more sense. It's practical education. And it's probably cheaper than a master's degree (which can't teach you this stuff, anyway).
After you graduate from the silly me-too project you can use your new-found skills to either get a better job at someone else's company, or to help found a second startup with a much greater shot at success.
And there's the major reason. We all* want easy money, so we groan and slap our foreheads with poorly disguised jealousy whenever a 14-yr old girl makes a million bucks with crappy myspace layouts. But the thing is, there's positive feedback for taking the low-hanging fruit: You can make a ton of money. And if you don't, at least you didn't have to invest much thought.
The 'problem' (if so you categorize it) is that there's no promise of greater return for greater effort. You can spend your life trying to solve BigProblems until you die, and get further than anyone else, but the guy in the next dorm room retired at 25 after making a social-networking site for parakeets with dyslexia. In two days, in ASP classic.
So if you're motivated by money, success, fame, there's not a lot of reason to go for the hard problems. And those are pretty common (and powerful) motivations.
*All including you, unless you don't, in which case it doesn't.
During 2.0 that pattern was contradicted as social bees tend to migrate and have a lot less loyalty. Friendster > MySpace > Facebook is one example, and there have been a quite a few other. However, is it really a great migration or simply natural segregation at work? I'm beginning to think it's the latter and that being said, maybe there is a play to be made for the me-too sites this time around.
Many businesses start successfully (first mover advantage) but are unable to maintain it allowing competitors to overtake them.
But I think the weak form of your statement is wrong. Here's Eric Sink, urging you to start a company in a field where there are already competitors:
http://www.ericsink.com/Choose_Your_Competition.html
"The big problem with avoiding competition is that you are also avoiding customers. The existence of a competitor indicates the existence of paying customers. If you can't find anyone who is making money with your idea, you really need to wonder if there is any money to be made there at all."
Let's consider the original article's example: cloning Flickr. There may be lots of good reasons to clone Flickr. It's a really new idea, and we haven't had much time to explore the space. For all we know, there might be all sorts of niche markets for Flickr-like services: Flickr for amateur baseball, Flickr for fashion designers, Flickr for medical illustrators, Flickr for architects. Each of these apps might have slightly different features (perhaps Flickr-for-architects would allow you to estimate the sizes of rooms by pointing at the corners of various objects in the photo, or provide various easy-to-use UI elements for matching photos with locations on a floor plan), and each would certainly be sold to a different market (or else they would likely fail -- in the Generic Photosharing market, they risk being crushed by Flickr itself). But there's no reason why they should not all coexist, just as the existence of Starbucks does not, in fact, doom all other coffeeshops everywhere to extinction.
Now, if you clone Flickr but don't add a differentiator, that's probably a mistake. And if you clone Flickr but don't have a revenue model that will keep you afloat, that's a mistake. [1] But there's no reason to expect successful businesses to be novel. Novelty is irrelevant. Only making money is relevant.
[1] This is the real reason why it's easy to laugh at many of the Flickr clones: Many of them have also cloned Flickr's revenue model, which involves being acquired by a company that has deep pockets and a large number of servers. It seems unlikely that this plan will work out for everyone...
The thing I see is that there are a lot of bright young things out there who want to be entrepreneurs but who have not the disposition or the discipline to be creative as entrepreneurs and who for whatever reason don't take a critical look at their goals and methods. Leaping on to the business model of the week becomes a substitute for self-assessment and critical reflection. And of course there is the "ooh that's cool, I want to build one of those!" factor to be considered.
In the early stages of a market (in any business), when someone stumbles upon something new/novel/untapped, there is always a land-grab and (initially) often plenty of users for everyone.
Ultimately success really comes down to the offering provided (e.g. you offer same service but USP being simpler GUI that saves you time) and the ability to iterate quickly and develop features that users want and find value (ideally without adding unnecessary complexity to what you already offer).
Many a successful company started as a "me too" clone (or late entrant), later becoming the dominant player.
It is only when the market is saturated do other issues such as "churn" etc. (e.g. as seen in the established mobile-phone markets) start coming into play. Now entering the market is actually not a good idea, unless you are offering something radically different (ideally a disruptive technology), but then you would not be a "me too" clone.
What then, do you do if you're not exposed to much?
When I spent time talking to people in SV 2 months ago, I noticed something I never expected: lots of people have very little exposure to "real world" problems.
People come up with "me too" startups because that's all they know.
Sure it's easy and cheap to start a business, and if you're smart and can hack, all the more reason. But what about the giant issue hardly anyone mentions: real world experience.
I've been doing programming work in real businesses for years and still get excellent startup ideas from my customers almost every day. In the past week alone, I have been challenged with problems I've never seen before that are really affecting these people. Just a couple of quick recent examples:
- One customer is preparing blanket purchase orders for '09 models, but since the SKUs change every season, their ERP system is of little help.
- Another is setting up a new warehouse, but their app won't allow bulk updates so they have to hire clerks just to enter 10,000 new bin locations.
- Another has a call center whose response time has doubled with an upgrade to their app. Now they want the new release's functionality with the old release's interface.
And this is just one week! People will pay big bucks for technical solutions to these real world business problems.
My advice to a young hacker with lots of skill but not much experience (outside of college apps): you may want to consider getting a job for a year or two. I know, everyone wants to start the next <whatever>, and get rich now and no one wants to sit in Megacorp's cube farm. And a startup, even a failed one, may be a better education.
OTOH, you will acquire dozens of great startup ideas (and contacts) and avoid the "me too" trap. Something to think about.
Once I really understood relational data base theory, those things (SKUs, call centers, warehouses) became exciting to me. A chance to practice what we preach. My customers are laboratories, much more so than Carr Hall 203 was in college.
OTOH, most people I know think everything we do is boring. They'd rather watch TV and talk about each other. Fortunately, we know better.
That's not to say that there aren't interesting engineering problems buried in there (e.g. how does one build a high-performance, distributed database architecture that can support tens of thousands of concurrent users, blah blah blah), but for the most part, the interesting portion of that kind of work is done by the (small) company that developed the scalable database technology in the first place. When you're hired as the guy who puts it all together as BigCo's real-time widget tracking system, you're mainly splicing together chunks of other people's previously interesting work.
Most paying work is boring -- that's why it pays. But if you can eliminate a class of boring work with a good piece of software, then you've got a business.
"Building a high-performance, distributed database architecture that can support tens of thousands of concurrent users, blah blah blah" is an internal project. One we do for ourselves. So that we (as users) have what we need to do our jobs for others.
Personally, I prefer external projects. Both of my mentors were engineers. Everywhere we went, they had something to say about what they observed:
"I wonder what would happen if they put a Coke machine right there..."
"The plane landed 17 minutes ago, and so far 0 bags have been removed..."
"If we move the inspection table to the center of the department, we will save an average of 116 steps per person per inspection..."
That's how I think now. I have real world customers and prospects with problems like these all the time. I love it. I'm always on the lookout for problems to solve with my apps.
I simply don't care about working on any internal projects unless I have to. There is probably a solution somewhere that one of you guys already did. So I'll use it to help me do my job.
Sorry you find what turns me on as boring. I guess that's what makes horse races.
If we ever meet, remind me to hide all the rusty spoons.
Moreover, what you describe as "external projects" sounds suspiciously like "walk around and fix individual problems in the world". That's great, but it's not scalable -- it's consultancy. Somebody hires you, and you tell them to move their Coke machine to save 116 steps per inspection. To me, the difference between that and an interesting software problem is the difference between noticing that a Coke machine needs to be moved, and writing a pedestrian traffic simulator that can be used to optimize the positions of Coke machines in any context...but maybe we're saying the same thing?
In any case, it's never a good idea to let your spoons rust.
I used to have to write the tools I needed first just to be able to do my job. No longer. Almost all of my tools are available.
What you call "walk around and fix individual problems in the world", I call "find problems anywhere, then build scalable solutions". Sorry if I didn't make that clear.
It's the antidote to OP's original complaint of "me too" solutions.
Getting them to understand is like yelling at water not to flow downhill.