The Unconventional Truth about building a company in Emerging Technology
It’s been a little over 3 years since the founding of LumiereVR, and every one of those years had been humbling lessons in their own rights. Year one was a lesson on responsibility, how to go from tech to business, surviving amidst the constant legal and finance chores looming over our heads. Year two was a lesson on management, most importantly time management. How to maximize 24 hours a day to stay ahead of the industry both technically as well as strategically. Finally year 3, the lesson on industry, how to live within it, innovate on top of it, and thrive with a team under 25 people.
Emerging technology is hard, and ironically, most of the time it isn’t hard because of R&D, but rather timing. Conventional startup wisdom that floats around in forms of books and medium posts often paint today’s landscape as a utopia for entrepreneurs. What better time to start a startup than now? Every question, every statistic is a google away, and capital seems to be pouring endlessly into the market. However when you jump on the blue sky tech-hype-train and raise a seed round in emerging technology all of a sudden things start to look differently. Whether you’re in VR/AR, crypto, drones, or IOT, you quickly become consumed alive by the question on product market fit. As you watch your burn rate eat away at that precious bank account, you realize all the must-read books on entrepreneurship were a total lie, or at least they don’t seem to apply at all.
How could there be product market fit, when the market has yet to exist? As you scramble to try and build a market for yourself suddenly you get investors and advisors chastising you for doing too much and how you should focus on doing one thing really well. In your frustration you explain to them that what they are asking you to do is akin to building an app for the iPhone before the iPhone was invented. Now they are afraid that you are too early and paving the way for other companies that will come after you. Worse, the entire funding landscape cools down for your industry as the hype train has left and you’re stuck with two choices:
You either drum up vaporware so you can bring in some more funding while promising your engineering team that you will soon go back into building real tech.
you can choose a much less sexy route and try to find a niche market and build a business that may not be scalable, but can potentially help you survive until adoption.
Those of you reading who are in the emerging tech space can probably relate very well to this. Especially in the bay area when your reputation rides solely on raises and exits, founders often get pressured into over-selling their company, creating 15 minutes of fame and immediately going back to fundraising again. Although the over-all vibe from a press point of view has been killing it, companies are usually over-diluted and over-valued leading to early implosion.
It’s also noteworthy the shift in atmosphere around communities and groups after the hype bubble bursts. After the golden year of 2016, it was all quiet on the VR front. Investors moved on to Blockchain, even some startups who were originally VR companies somehow took a 180 degree pivot and became Blockchain companies. However the winter did well to cleanse the community, almost like the biblical flood, it wiped out everyone who was not serious or passionate about the space. Without easy access to capital, companies had to create markets for themselves and learn to generate revenue. What we found was that the interactions between companies became more genuine and more collaborative rather than competitive. Startups were more open to talk about strategy, and intracompany relationships became a collective mindshare to push the industry towards adoption.
The conclusion I have is that, starting a company in the emerging tech space may seem like an easy way to get funding, but if you lack the passion for the underlying business that you are starting, you most likely will never make it far enough to experience what truly is the most rewarding part of being in emerging tech, which is the community that comes together to pave the way for the future of humanity.
For us, we took the second method and found a harmonious way to do cross border VR film production and distribute through integrated VR Theaters that we build in association with venues with high foot traffic including museums, aquariums, and sports stadiums.