A new category and the startup chances to handle it

Many startups launch ideas that are intended to put a dent in the universe. In other words, some of them aim to redefine the market conditions and to create new categories, bringing users to understand a problem and immediately find them a solution.

What many may ignore, however, is that bending the (market) universe is a glorious phenomenon that also create forces that changes the linearity of their story; exactly because a new category bends the market.

Let’s imagine a hypothetical lucky startup that helped the world to see a problem and launched a resonating solution accordingly. Now, as the company delivered its category-goal, the collateral from that is that they have rung the bell. According to Play Bigger [1] authors, once you do that there is no way back. As the company strongly alerts emerging category customers to that new potential idea, it sparks a flywheel at another dimension in the ecosystem: the whole category starts to move now, even without you.

The implication from that is around the fact that users, and the whole ecosystem around them, may take the category to the next level. It’s like a gravitational pull that forms and establishes the new opportunity at a whole new level: not only for you but resetting the landscape as you have dented the universe. The very success may actually put the company in danger.

And at that situation, the projected linear story starts to vibrate. If you fail to deliver the promise (now the expected promise), not only can users deviate but new incumbents can also enter the game. Some of them might even be experts in doing so after the first to market.

Now, the best thinking is not to think that they are your users. These are category user players that truly understand that new category — in some cases better than you — and are now ready to choose the better, since they are not only limited by that unique different solution.

The non-linearity of the story does not stop there too. At later stages, specifically for companies that successfully warped and took over the category potential, they may actually top up and reach the limits of the category potential as a result of their own success (user base or market capitalization limit, for example).

The real danger, for these lucky ones that establish themselves as category kings, derives from the lack of strategy because it’s quite important to foresee what’s next, if there is a next; the means to reach and discover new waters while still sailing with the current.

References

[1] Al Ramadan, Dave Peterson, Christopher Lochhead, Kevin Maney. 2016. Play Bigger: How Pirates, Dreamers, and Innovators Create and Dominate Markets.