

Many of the world’s legendary tech companies got started just as the public markets were cooling off; Microsoft, Apple, HP, IBM, Oracle, FedEx, etc. The most recent case in point is the startup class of 2008-2009: Dropbox, Airbnb, Pinterest, Uber and Tiny Speck (Slack) all got their early funding in those dismal years.
And, while not everyone agrees that there is a massive downturn in the startup world right now, many are acting as if there is. This herd mentality is both a crisis and an opportunity (or a “crisi-tunity”) — just as in the last cycle, I believe the category-defining companies of the next decade will be launched and funded in the next couple of “less exciting/slower” years.
I meet with hundreds of ambitious, passionate and insanely talented tech founders every year. They are all working hard 24/7 to make their dreams come true. But it breaks my heart when I see talent wasted on solving derivative problems a bit too late in the cycle.
I understand if a given problem is a founder’s passion, and respect that. However, if they aren’t crazy about the idea in the first place, it’s better to give up the “Uber for X” ghost and instead focus on more original inventions — ideas that could create new markets and enjoy infinite runway in terms of growth.
That ambitious founders learn from the successes and failures of other category-defining companies is of paramount importance. However, even if a young startup executes flawlessly on all the tactics of an incumbent company, it won’t work out as well.
Why? Because you can never step into the same startup zeitgeist twice. If something isn’t original, but well-understood as a successful strategy (e.g. for distribution), the barriers to entry will be low — and many will jump in to take advantage.
The strategic visions outlined below would have been revolutionary five years ago. In 2016, they would be the quickest route to failure.
Coming up with an idea
Distribution tactics
Product strategy
Business strategy
PR strategy
The good news is that in 2016 the field is level again. Startup folks have ideas about what may be coming next, but nothing is as obvious now as it was for the last cycle, e.g. AWS, cheap and fast Internet connections, Facebook for distribution, mobile.
So now is the time to innovate… If you do something hard and break new ground, you’ll have the chance to build a category-defining company. That is what you should aim for: The “it” company in a new space enjoys a huge premium over its competitors.
However, the next Facebook and Snapchat will look nothing like Facebook and Snapchat. And if you are lucky enough to build this cycle’s Uber, be forewarned that it will serve as inspiration to many more founders who would love to emulate your success. They’ll replicate it in other verticals and markets ad infinitum until the cycle resets … But for now, I can’t wait to meet the startup class of 2016.
