Jan Bosch is a research center director, professor, consultant and angel investor in startups. You can contact him at jan@janbosch.com.

Opinion

Entrepreneur lesson #7: Solving ‘your part’ only is causing you to fail

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The founders I work or have worked with do not only have a problem they’re looking to solve; they also have a set of skills, often built up while working for another company, that they’re looking to bring to bear on that problem. As I learned while working for Intuit, the three key rules are (1) select a relevant problem, (2) that you have a suitable solution for and (3) where you’re uniquely suited to apply the solution to the problem as that gives you the “unfair advantage” that helps you build differentiation and a moat around your business. The set of skills of founders should be and often are the “unfair advantage” I’m looking for in a startup.

Mature industries typically are horizontalized and there’s an architecture of the business ecosystem that defines the roles of and interfaces between the different participants. As a company in that space, you can survive and even thrive just by focusing your energy and creativity on doing a good job within the box you chose to inhabit. The ecosystem’s architecture will ensure that your results will fit and are integrated with that of other players and end-users can assemble their desired offering or ask an integrator to put it together for them.

The challenge in a startup is that the only way you can win is to disrupt an existing market and associated business ecosystem. Often this means bringing in some type of major innovation, which can be technological but can equally well be a business model or process innovation. The immediate consequence, however, is that due to the disruptive nature, the business ecosystem serving the market you’re looking to address doesn’t ‘fit’ you. Or, rather, you don’t fit into any of the roles and positions defined in the ecosystem. And, of course, it might well be that you’re looking to create an entirely new market, in which case there’s no business ecosystem architecture at all to rely on.

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