As a child I used to go to the local video store to rent movies to watch on the weekend. The store, part of the Potomac Video chain, was one of the last video stores in Washington, D.C. But after 33 years, the business suddenly shut its doors last spring. Why after so much success did the business shutter its operations?
The reason businesses don’t last is they fail to innovate.
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Regardless of your past business model, if the market has changed, your business needs to change, too. Potomac Video didn’t latch onto the trend of streaming movies online or shipping videos straight to customers’ doors. It stuck with its old business plan, simply renting and selling videos from a store.
For that matter, remember how you used to love to stop by Blockbuster? You know, the place you’d stop by on the way home to pick up that new release on VHS? (Blockbuster filed for bankruptcy in 2010; yet even after Dish Network acquired its debt, Dish decided to close all retail stores, according to MarketWatch.)
Did you know that in 2000 Blockbuster had a chance to buy Netflix (now worth $28 billion) for a mere $50 million? And the company opted not to. Netflix was losing money at that point. Blockbuster was hesitant to gamble, not looking ahead, perhaps looking for a short-term profit rather than a disruption of the industry.
An entrepreneur who wants to experience continued success in business must stay on top of his or her industry and predict the future. Entrepreneurs Giovanni Mannella and Misha Mitsnefes have done just that with their startup Bmpur, whose social music network puts the power of music sharing and discovery into the hands of users. Mannella and Mitsnefes beta launched Bmpur this spring and fully launched Sept. 8.
Mitsnefes owns a music blog, Fist In The Air, and Mannella had owned a music-video curated website. "We both saw an opening in the market for this type of sharing and discovery platform and developed bmpur together, starting in fall 2011," Mannella wrote by email. After connecting with others in the industry, they noticed a shift in the market. People wanted to add value to others’ listening experiences.
"Post anything from YouTube, Soundcloud, blog links, Instagram links, etc. Then the community interacts by “bumping” posts, commenting, favoriting (like repost/retweet), and sharing the link!"
Mannella and Mitsnefes are taking a gamble with their new approach. They realize that Bmpur won’t last without innovation.
If you’re looking to change up your business model to make your startup last, use these three approaches:
1. Continue to build a brand.
Innovating with a startup doesn’t mean just changing the name of a business or overall brand. Instead use the leverage of an existing brand to draw attention to its evolution and innovation. Bmpur built excitement for its platform through its social media channels. Consider making ambiguous announcements to keep people on their feet.
2. Gather feedback.
The best way to see if a business will grow as a result of innovation is to see what others think. Before a new product launch or redesign, show family, friends, acquaintances and even die-hard customers. The team at Bmpur unveiled its new concept months before it was fully developed.
3. Connect with other industry leaders.
The key to a successful change in a business is ensuring that others know. Connect with other industry leaders to see if they have advice. If you have a blog, connect with other bloggers to see if they want to help promote your business shift. You could end up leading a whole industry swing.
Making a startup last is a challenge that every entrepreneur faces. Businesses often see a period of strong growth, hit a peak and then the business begins to dissolve. Ensure your business doesn’t peak by continuing to innovate.
Correction: This piece has been updated to correct the date of Bmpur's start and details about its focus. Bmpur always provided a social music network, which beta launched this spring, although its founders started its development in 2011. One of the founders, Misha Mitsnefes, runs his own music website, Fist In The Air.