Looking for an Innovative Idea?

One of the most widespread ideas about entrepreneurship is that successful companies are always companies that Innovate.

 

That makes people think it is impossible to Start a successful Business unless they have a new Innovative idea.

 

… And that is not true.

If you analyze it carefully, the most successful companies are not the most innovative ones.

  • They just do what others did before… but much better.

You don’t believe it?

Innovate vs Imitate - Mp3 example

 

Do you know which company invented the mp3 player?

  • SaeHan Information Systems.

 

Who do you think earns more money with mp3 players: SaeHan or Apple?

There you have.

Successful companies innovate in the interface, design or even the way you use the product.

 

But… The company that invents something completely new, rarely benefits from it as much as others who imitate it.

 

Why do we tell you this?

Because, if you plan to become an Entrepreneur, you shouldn’t wait to have a wonderful Idea because even if you did, you probably would not benefit from it as much you would expect.

Entrepreneurship is not the same as Innovating

According to  the Cambridge dictionary, an Entrepreneur is:

  • Someone who starts their own business, especially when this involves risks“.

 

You don’t need to Innovate to be an Entrepreneur.

 

In fact… You’ll have more chances of success if you “Imitate” other profitable business.

We are not encouraging you to copy other companies dishonestly. Of course no.

We only suggest that, in general, it is usually better to improve something that already exists.

If you want to become an Entrepreneur, do not become obsessed with innovating or being the first.

 

Simply offer something better than your competitors.

Being first is not always best

The first always takes more risk than the second.

Of course, many times, this can be an advantage.

 

But. If you release a completely new innovative product:

  • You don’t know if people will love it or not.
    • No one has offered anything similar before.

 

  • You are likely to “fall in love” with your innovation so you won’t be able to be objective about its “marketability”.
    • This is very common: companies that don’t accept that people don’t like their new innovative product.
      • Usually, these companies end up spending millions of dollars in useless marketing campaigns.

 

  • There are lots of commercial uses that you don’t know that would best suit your product.
    • Many people focuses on a single market, so it is difficult to know about others.

 

Let’s see some examples:

 

Innovative products that failed

 

Google glass

Even before commercializing this product, Google realized that it wouldn’t meed the expectations that had been generated.

  • Hence, Google decided (intelligently) to delay its release until necessary.

 

Virtual Boy

With Virtual Boy, Nintendo was ahead of its time and the technology available.

  • Not even today, Virtual reality is perfect enough.

This product ended up being Nintendo’s biggest failure.

 

Apple’s Newton

In 1993 Apple introduced the first PDA.

  • Other product too “ahead of its time” that failed.

Interestingly, in this case Apple would benefit from its iPad 17 years later.

 

Ruputer: The first smartwatch

In 1998, Seiko released Ruputer: the first smartwatch.

  • Again, other product ahead of its time that failed.

Despite all these products failed, there was a of work behind them.

  • Research.
  • Innovation.
  • Professionals.
  • Marketing campaigns.
  • etc.

And only large companies can afford to spend this time and money and not succeed.

We have focused on Innovative products that failed.

 

But what about the companies that Imitated others?

Companies that Innovated vs Companies that Imitated

We’ll say in advance that:

  • We are not saying these “imitating” companies copied everything and innovated in nothing.
  • We don’t say that the “copied” companies were the absolute first either.

 

We simply say that, in the following examples, the company that came “second” learned from the mistakes of the previous one and did it better.

 

Let’s begin:

MySpace vs Facebook example

 

Some of you probably don’t know what Myspace is.

It was the first popular social network (perhaps not the “absolute” first, but the first one that became popular worldwide).

 

From 2005 to 2008, everybody had Myspace.

 

What happened?

Mark Zukerberg developed a similar yet much better product: Facebook.

  • Facebook was much more intuitive.
  • It made more sense.
  • You could better control who accessed your profile.
  • And, it was much more difficult to delete your account.
    • Myspace accounts were very easy to delete while facebook’s are much more difficult.

 

Using Google Trends, you can easily see how Facebook surpassed Myspace in February 2009:

 

Yahoo vs Google example

 

There was a time when Yahoo was considered not “a browser” but “The Browser”.

 

What nobody expected was that few years later, other Web Browser would swept it from the market: Google.

 

What happened?

Google developed a search algorithm that gave results that were better suited to what users were looking for.

 

They didn’t invent the “Web Browser” or the “Search Algorithms.

  • They simply did better than everyone else.

 

If we check Google Trends again, we can appreciate that Google surpassed Yahoo in October 2011.

eBay vs Amazon example

Even though eBay is still a very important and large Site, there was a time when e-commerce was synonymous with eBay.

 

eBay has always focused on online auctions.

 

They were “just” a platform that put “buyer” and “seller” in touch.

eBay did not intervene in the delivery process (we don’t know what they do now).

  • All they did was cancel the accounts to the people who “cheated”.

 

Amazon realized that lots of users distrusted on-line retail and also, that they were not interested in this auction system.

 

They then focused on:

  • A direct buy-sell business model.
  • Reduce delivery time as much as possible.
    • eBay didn’t care about this. It was your thing.
  • Ensure that users received what they purchased.

 

The result is well known.

 

In October 2011 Amazon surpassed eBay in search volume.

Atari vs Nintendo example

 

In case you don’t know what Atari is, let’s say Atari was the King of the video-game in the 80’s.

 

The only and almighty Game Console company.

 

But one day, a new company appeared with much better games.

  • It’s name? Nintendo.

 

Nintendo did what everyone was doing, but much better.

 

10 years later, Atari disappeared.

Conclusion: Should you Innovate or Imitate?

We don’t say that Innovation is something useless.

 

In fact all the successful companies we mentioned Innovated in different ways.

  • Nintendo created new ways to playing.
  • Amazon made many innovations in the delivery process.
  • Google Innovates with its unbeatable Search Algorithm.
  • Facebook created new Innovative interface.

However:

  • Nintendo didn’t invent the Game Console.
  • Amazon didn’t invent the on-line retail business.
  • Google didn’t invent the first Web Browser.
  • Facebook didn’t invent the first Social network.

They did what others did before… but much better.

 

We simply say that: If you want to become an Entrepreneur, don’t be obsessed with having a wonderful new Idea.

Focus on being the best.

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