When the live streaming service Rdio burst onto the scene in 2010, it seemed to have everything going for it: a pedigree from the founder of Skype, an early entry to market and $117.5 million from investors. But, by late 2015, Rdio was bankrupt, its intellectual property sold to Pandora for $75 million and its service shuttered.
The startup became an object lesson on the failure to develop game-changing technology quickly and correctly. Though Rdio was nearly first out of the gate, its cautious approach to generating revenue let it slip behind Spotify, which moved faster.
Speed is crucial -- and so is the need to stand out. At the same time, the competition to stand out has never been greater.
The key is honing, refining and iterating ideas quickly. You know the adage that says, “Perfect is the enemy of good.” But business consultant David Roth takes it a step further when he says, Waiting to release a “perfect” product can make the difference between finding a market and missing it entirely.
Startup troubles by the numbers
With 100 million businesses launched every year, entrepreneurs have no problem finding ideas. Venture capital activity soared in 2015, with $17.5 billion invested in the second quarter alone -- the highest quarterly total since 2000.
Yet influential investors such as Marc Andreessen predict an end to such go-go spending. Young companies more than ever face the imperative to get their technology done fast and right the first time. Developers who can manage projects and iterate quickly are in high demand, and investors trust entrepreneurs who deliver results.
Timing, then, is just as important as making sure your tech solves a concern. To stay relevant and competitive, and retain customers, you must hit on the concern, yes, but also deliver on it even as you're building trust. If it takes too long to address a pain point, someone else may beat you to it.
Matching speed with excellence
Entrepreneurs and top-notch developers can move fast -- without sacrificing quality -- by considering these four steps:
1. Build out your knowledge base. My clients, the founders of Silvermine Capital Management, knew how to manage U.S.-leveraged credit portfolios but knew nothing about building apps. By honestly assessing their strengths and their shortcomings, they found a technology partner to help them build their ideas into a multibillion-dollar business that was acquired by Man Group in 2014.
Conduct an honest evaluation of your knowledge base before jumping into the deep end. To cover the holes in your knowledge, conduct consumer interviews, read up on trends and reach out to experts who may be willing to get on board as collaborators.
Lock down your product’s main consumer base; then ask a subset for its reaction. Determining who is receiving your deliverables makes your deadline much more real. And feedback from this group can give you a proxy before you go out into a wider audience.
4. Cut the dawdling. You’ve set priorities, collected information and involved the right people for the job -- now it's time to get busy. At my firm, we start every project with a kickoff meeting, reviewing a brief that defines every detail: how we’ll communicate, who is responsible for what and when the deadlines are. We begin with the end in mind, schedule check-ins at the outset, and use daily stand-up meetings to keep the project moving.
Game-changing technology has no defined recipe for success. But, with technical know-how, a background in the industry and an understanding of the market space, you’ll be able to create an amazing user experience -- before the opportunity passes you by.