Startup Advice
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Startup Advice
On building “Flavored” startups
Enterprise software is (mostly) not flavor-based. Sure, there are enterprise fads like the metaverse, but generally speaking, large companies only sign contracts when it feels like there is an obvious commercial advantage to doing so.
Networks are (mostly) not flavor-based. If you’re using an app because of the content created by its other users, it’s not necessarily a guarantee for success, but at least if it fails it probably won’t be because it hit a flavor-based asymptote. For instance, BeReal leveraged a unique flavor of photo sharing to build a network, but people are still using it because they like the way it helps them stay in touch with their friends. If it were just a single-player utility, it would not have scaled in the same way. Another historical example is Instagram versus Hipstamatic. Both had a cool new flavor called “photo filters,” but one had a network and the other did not. Here’s a more recent example: the network is what sets Substack stands apart from its flavor-based competition.
Tech-enabled services are not flavor-based. If you act like a tech company but really do grocery delivery, banking, education, housing, healthcare, or any other real-world service, your competition is mostly not flavor-based because starting this type of business involves a lot of cost and complexity. (Also, some, like ride hailing and delivery, are networks.) The downside is that your cost structure is probably not as great as pure tech companies, but the upside is that you have less competition.
All of these types of products can involve some flavoring to help them get off the ground. The point is not that flavoring is bad. It’s good! But it has a very specific role. Flavor provides an initial product wedge. It’s helpful for standing out initially but doesn’t provide long-term differentiation or durable advantage.
- The 7 sources of power:
- Brand: Your unique brand identity attracts and retains a significant number of customers.
- Process power: You can produce something more efficiently than competitors, and the competitors can’t easily copy the method.
- Cornered resource: You have exclusive access to a vital resource, such as the only rights to a patent.
Business strategy with Hamilton Helmer (author of 7 Powers)
Amazon: How do we keep experimenting in superfast delivery?
September 19, 2013
Marketing 101
How to build a brand strategy from 0-1: a guide for startups
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Amanda Goetztwitter.comI’m sure you’ve seen your fair share of ads trying to sell you the greatest new tactics to get more customers, make more sales, and earn a bazillion dollars while you sleep.
The problem with most of these ads is that they’re selling you recycled tactics with new catchy names pulling you away from your goals.
I say this because tactics without a... See more
The problem with most of these ads is that they’re selling you recycled tactics with new catchy names pulling you away from your goals.
I say this because tactics without a... See more
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