Finding a Big Idea
Lately, I've been squarely focused on learning what makes a business truly great. The most insightful piece of information I've gotten so far was from Laura Lederman, a self-described Salesforce groupie. She said that great businesses target budding markets with little or no competition, then work to expand it with the expectation that market growth is a five-year process. Great advice, but it also implies something else: that your idea/company should alleviate a broad pain that will be more widely felt the future. Basically, great companies predict markets by looking around at what others are doing right now. I whipped up a quick diagram of how I envision this market timing working. Assuming everyone is able to penetrate the market (e.g. build, market and sell) at the same rate, a company would get more value by predicting the market a few years before it exploded. The later a company latched on to this phenomenon, the less there'd be to reap from the market. Predicting too early is also equally deadly, since you'll be running a business that has no customers. My favorite examples of good market prediction are products like AWS, AppEngine and Heroku. Their platform as a service business model was so successful because they saw a growing industry of SaaS applications that would require technical infrastructure. They took all of the generic tasks and boiled them down to clicking a few buttons. In the past, many of the ideas I've had solved my or someone else's immediate problem. Now, the challenge is to find an idea that fixes the future. Should be easy.