The Startup Virus — if it doesn’t kill your business model — it may make it stronger.
What if I told you that the relentless wave of disruption inflicted by startups on established business communities all over the world, is similar to an evolutionary pattern that has been going on for millions of years?
Viruses are highly adaptable, intelligent, agile and beyond the diseases they cause, their role in human evolution has long been understood by genetic scientists. When a virus attacks a human host, it injects its DNA into our human cells and uses our cells to replicate itself, if the human host survives the attack, it potentially ‘benefits’ from the viral DNA and could even pass it on to future offspring. Last year the University of Lund in Sweden published research that found that due to the constant battle between humans and viruses over hundreds of thousands of years, significant amounts of virus DNA has merged into our human genome. The study estimates the virus DNA component to be almost 10 percent of our entire genome. Which also means that virus DNA is playing a significant role in the functioning of the human brain.
What doesn’t kill you makes you stronger.
Now consider the following; every day thousands of startups all over the world are probing for potential weak-spots in the incumbent business models and customer segments of established corporates. Most of these startups will fail, but enough are penetrating the ‘immune systems’ of established industries and ‘injecting’ their DNA or new thinking into these industries to either disrupt them or in some cases to kill them off completely.
Let’s look at some real-world examples;
The Taxi Industry vs. Uber
Through providing a service that customers need and coupled with protracted legal and commercial battles, Uber has ‘penetrated’ a rigid and staid industry and is using the ‘host industries’ vehicles and drivers against them. This allows Uber to execute its business model and take their customers away.
$1,000,000 — The value of a New York taxi permit in 2013. (Pre Uber)
$200,000 — The value of a New York taxi permit in 2018.
The Petrol Car Industry vs. Tesla
Tesla has ‘infected’ a 120-year-old, multi-trillion dollar global industry, with new thinking (DNA) and virtually forced the industry to start planning for and producing electric cars. Initially and in some cases still, against their cultural will.
March 2016 — Ferrari CEO Sergio Marchionne “There will never, ever be an electric Ferrari,….it’s almost an obscene concept!”
January 2018 — Ferrari CEO Sergio Marchionne “If there is an electric supercar to be built then Ferrari will be the first, ….electrification is a core skill that needs to be mastered”
How to avoid a Startup Virus?
Businesses may avoid or delay the onset of a startup virus attack by constantly strengthening its business model immune system. How? By not being ‘interesting’ to startup viruses.
This involves relentlessly adapting to new business conditions by practicing creative destruction on its products and services. By being guided by customer relevance(see my earlier post on the topic) and incorporating Human Centered Design, Lean and Agile thinking in the way that they think about delivering products and services. All of these actions may mean(but not guaranteed) that the business ceases to be an easy target for startup viruses.
Startup Viruses don’t care about the host industries that they infect or whether the host survives the infection — they care about transforming the business environments that they operate in.