While the term 'disruption' is appearing in many headlines throughout the technology and business press, as an entrepreneur I feel it is more important to look at the trend lines than at the headlines.
Trend lines involve a good deal of research, a touch of insight, lots of hard work, and substantial risk. In the case of my company, Blue Jeans Network, that research began three years ago and is a good blueprint for today's budding entrepreneurs.
My co-founder, Alagu Periyannan, and I began looking at the Web video industry in 2009 and projected how current and future trends would manifest themselves 3-5 years down the road. What we saw following our analysis was some big problems. To entrepreneurs like Alagu and I, however, problems equal opportunity.
Specifically, we saw how these trends would soon intersect.
- High-definition video was making significant technology advances, particularly in the means for HD video to run over IP.- The growth and pervasiveness of broadband adoption was growing at tremendous rates.
- A younger generation of workers more comfortable with Web video was entering the workforce and the entrepreneurial pool.
- Device proliferation, particularly tablets and mobile devices, meant that more people would be working remotely on a wider array of end points.
The problem/opportunity that we keyed in on was that despite a mature infrastructure, the end points could not interoperate when it came to video. We focused our business on solving that problem in 2009. Today we have connected over a quarter of a million participants in over 3,000 cities worldwide into hundreds of thousands of video meetings.
A report was published recently by Purple Insights stating that seventy-seven percent of 1,000 U.S. residents surveyed said they want video calling to be as simple as making a phone call. Eighty-three percent wanted Skype to be interoperable with other video technologies. And two-thirds believe that interoperable video will create more jobs and innovation.
What was most exciting about this research is that it mirrored our own research from 2009-10. And therein lies the biggest lesson for entrepreneurs. With all due respect to the experts who write about new disruptive companies, if you are an entrepreneur getting your ideas by reading about existing businesses, you are already too late. To be truly successful, you need to successfully anticipate an opportunity that is 2-3 years away, and then move relentlessly toward solving that problem.
With that background in mind, here are a few other suggestions on bringing a disruptive business to market.
1. Know Your Enemy: It may sound obvious, but you can't disrupt a market unless there already is a market. Without competition, you don't have a market to disrupt. Having established competition also makes it far easier to galvanize your employees against a common enemy, and furthermore means that there is an established community of influencers who already follow your competitor and are paid to look out for new competition. Marc Benioff famously goaded and prodded Siebel Systems until they responded publicly to Salesforce.com's threats. By then it was too late for Siebel.
2. Domain Expertise is a Double-Edged Sword: Albert Einstein stated: "We can't solve problems by using the same kind of thinking we used when we created them." For this reason, the first ten employees at Blue Jeans were deliberately not from the world of video conferencing. Entrepreneurs will have a much harder time truly disrupting a market if they are part of that industry. Our company could not have brought a fresh perspective to our industry if we had begun with a collection of video conferencing veterans. Both for the fresh perspective and for the early company culture, look outside for insight. Similarly, new entrants to a market have the unique opportunity to dispense with legacy product baggage. However, the product offering from a disruptor has to be significantly better than the product is hopes to supplant. This was the case when Salesforce.com disrupted Siebel, and just as true when Apple got into the music business and rendered the Sony Walkman obsolete virtually overnight.
3. The Weather is Always Cloudy: Today's businesses need to be able to scale quickly, but the good news is cloud computing affords tremendous opportunities to build a business on someone else's infrastructure. At some point it makes sense to bring some functions inside an organization, but everything from HR to payroll to data centers can be looked upon as a utility service. Cloud computing has dispensed with a business proximity requirements. Gone are the days when a manufacturing facility had to be built alongside the riverbank for hydro power; that power now comes from a de-centralized service provider and is available on demand. This allows businesses to grow substantially faster than ever before because much of what's needed for infrastructure or operational purposes is available at the click of a button.
4. Let the Customer Decide: Think you have the perfect widget for teachers, only to see it adopted by doctors and nurses? Don't fight it. I've seen pre-conceived notions of customer segments torment companies. When we were first formulating likely customers for Blue Jeans, we had a strong inclination that the Fortune 5000 would be our sweet spot while also making video conferencing affordable to the mid market. And while we have made great inroads in these markets, we are pleasantly surprised at how many small businesses we work with. So in addition working with large, well-known companies such as Facebook and Groupon, we help small businesses like Dishup Today conduct cooking classes over the Web.
5. The 24-Hour Workday: I'm not advocating a return to the early days of the Industrial Revolution, but rather recognizing that employees work all over the world. In many cases, every hour of the day can be covered by a variety of personnel across multiple time zones. Particularly with respect to customer satisfaction, there is no better way to please a customer than to have a service department that never sleeps. In particular, look for complementary departments in different time zones. We employ product experts locally in Silicon Valley, and the engineers and developers who refine those products in India. Our Bay Area product team can make engineering requests at the end of their day, and have those requests completed when they arrive the next day. Similarly, because of the benefits of cloud computing is that a remote workforce is far more productive. That means you can hire the best people for your company, regardless of their location.