Want to make $425 Million or More? This is How Trello Did it!
Disruptive Innovation is one means by which you can create a million dollar empire for yourself. And, the best part is that it’s not as complicated as you think. You just need to find an opportunity and make the best out of it. Here’s how!
While some companies create complex products to move upmarket, they completely forget about the void that the process creates. This is the exact opportunity that you can grab as an entry point. Through close observation, you can find a vacuum for innovation in many industries. By filling this space with simpler and cheaper technology, you can build a $400 million startup for yourself. Your innovation may not fetch you high returns initially, but when the time is right, it’ll bring you a jackpot! Not a clone but Disruptive innovation serves as the key to a million dollar empire.
As they are busy growing their business, their processes become more intricate and costlier thus leaving a scope for your weak but simple disruptive technology to replace their well-settled product. Products based on disruptive technologies are typically cheaper, simpler, smaller, and more convenient to use. The weaknesses of your product today will become strengths tomorrow.
Trello is a living example that fills us with eternal hope. On the other hand, Atlassian overshot the market by adding new features in their approach to capturing new customers. They went upmarket. As the company’s revenue grew, its product became overly complicated and difficult to maintain. By moving upmarket, Atlassian produced a vacuum at lower price points, which made the entry of competitors with disruptive technologies into it. This is where Trello grabbed the opportunity. Trello created a simpler, smaller, and cheaper version of Jira. It focused on marketing its product to sectors of customers, like marketers, managers, and designers, which weren’t a focus for Atlassian. In 2011, there was no competition for Trello and it filled the void created by Atlassian.
The company bought Trello for $425 million, not because of its brand or its user base, but because Trello was a significant threat to the company’s future.
As the company was moving up-market at a rapid speed, Jira became expensive. Its mainstream customers were ready to accept fewer features for better pricing. That’s how Atlassian became susceptible to assault from competitors who had cheaper and more convenient products to offer.
By smartly adding more features, Trello also moved upmarket and crossed the mainstream market needs. On doing so, Jira’s mainstream customers were ready to switch to Trello. This is how disruptive innovation overtakes established products. The company made a wiser decision and bought Trello.
Opportunity can come from any industry. Remember when Google bought Android? Android’s operations were not fully integrated into Google’s primary business. Even Google’s employees had zero access to the Android offices. It was one of the best acquisitions by Google. Many industries that are moving upmarket at a breakneck speed are unknowingly creating a vacuum for your entrance. You have to keep an eye on every movement of your targeted industry, just like Airtable. Zapier published statistics about the fastest growing apps. In first place was Airtable, with a growth rate of 682%. If you haven’t heard of Airtable, it’s a cheaper and simpler version of Microsoft Access. The idea is clear, products based on disruptive technologies are typically cheaper, simpler, smaller, and more convenient to use.
So if you too want to establish a million dollar set-up, be the first-mover. Grab the opportunity as it knocks the door. Keep a close supervision of the industry that you’re targeting. Create something new, but simpler and cheaper. Make something the mainstream market doesn’t want now but will need later. Remember, the weaknesses of today will become the strengths of tomorrow.