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In start-up land, different is always better

This week I immersed myself in a segment that I have never explored before, the managed services provider industry.

I traveled a total of 17 hours to Florida, to attend a conference with a potential partner. The objective of this discovery trip was to gather real-life knowledge about the industry, product, and users in order to learn how to make their customers successful long term.

On my way down I read 90% of a book called David and Goliath by Malcolm Gladwell. This book had been sitting on my shelf for the last semester and the timing to pick it up couldn’t have been better.

During the four days I spent in Orlando, I realized that the landscape of the MSP industry mimics most areas of the technology world.

In one side you have the established enterprises, with large market share and archaic solutions. They fail to listen to the market and are too afraid and slow to completely reinvent their offerings. Falling into the trap of creating incremental improvements to the same old platforms.

On the opposite side of the spectrum, you have the start-ups. Young companies that have emerged in response to the unheard frustrations of industry specialists.

In this soup of solutions, some start-ups were shining brighter than others, and it is easy to pinpoint the reason why.

Walking through multiple booths, a lot of the products looked and sounded very much the same. Some start-ups chose the route of incrementally improving what is already known to the market. This type of thinking locked them to a similar design, experience, and technology offered by those large enterprises.

Incremental improvements yield marginally better results. Marginally better results do not make the business case for a change in software, migration of data, set-up and configuration, onboarding, training etc.

Customers will likely not leave their current providers for these guys. And if they are successful in delivering those selling points, enterprises will likely incorporate the changes to their existing products either through early acquisition or simply by producing in-house what those companies created.

In this (and any other) conference, the real noise came from those start-ups that connected dots in a whole different way.

They listened carefully to the market and what potential users have to say, they asked better questions and got to the root of their pain points.

The passion and dedication to building a solution that radically improved their users’ ability to perform their job better, generated software that looks and sounds fresh, because it performs differently.

As Mies van der Rohe once said: Form follows function.

In the first chapter of “David and Goliath”, Malcolm Gladwell explains the old tale of how a poor shepherd defeated a giant soldier in shiny armor by being agile and attacking from an unexpected angle.

In the fight between start-ups and technology corporations, the winning tactic is no different.

The giant, in this case, has the market share, the name, the reputation and the money to invest in improving their product. But find themselves in an “U” shaped curve, where more resources and customers are more cumbersome than helpful, and they cannot pivot fast enough to keep up with the market’s demands.

Start-ups are agile, have the ability to create something new from ground zero using the learnings from other companies, can work closely with customers to figure out what are their biggest pain points, leverage new technologies, and new design techniques.

But those things are not enough for a young company to thrive in the competitive space that is the technology industry.

They must dare to think and build differently, to dig deeper in areas where existing products are falling short, to connect dots that others have not connected yet, perform deeper integrations and use design to transforms their vision into a living and breathing product.

So, to all my clients and all other start-ups out there, dare to be disagreeable, swim against the current, challenge the concepts that form the basis of your industry, and attack from a novel angle. It is only through the unexpected that shepherds can defeat giants.

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