Some business ideas are truly revolutionary – radical departures from anything done previously. When revolutionary ideas lead to successful companies, founders and investors reap bountiful rewards. In 1999, two venture capital firms invested $25 million in a young, innovative startup with an odd name: Google. Their stake in Google is worth about $50 billion now.
But starting a company based on a revolutionary idea isn’t for everyone. It’s extremely risky because there are so many unknowns. Will customers buy the product (or service)? Will they pay enough for you to make a profit? How much will it cost to market and sell the product?
Many entrepreneurs prefer to pursue evolutionary ideas. They find concepts others have implemented successfully, and modify them. These founders strive to create the “this of that”. Here’s why:
1. Lower risk. Method revolutionized the household cleaning product market. They developed sleek designs and eco-friendly formulations, and outmaneuvered huge rivals like P&G and Clorox. They also opened the door for other startups, by establishing a proven model for success. Following that model is less risky than creating a new one and hoping it will work.
2. Instruction manual. A friend of mine is building “the Method of oral care products”. Whereas founders with revolutionary ideas have to start from scratch, my friend can look at the history of Method, and learn from their successes and missteps. He’ll have a head start when figuring out how to price, manufacture, distribute and market his products, for example.
3. Easier to pitch. Founders of startups have to persuade other parties that they have a winning idea, including customers, investors, partners, suppliers and employees. A “we’re going to be the this of that” pitch makes it easier for those parties to grasp and believe in the merits of your idea.
Got a “this of that” idea? Post it here for some free feedback. Don’t worry about copycats – success is about 95% execution.