A business lesson: Go where the sardines are

We are lucky in technology, because many other industries can only grow linearly and so that growth is a massive, long term effort that results in businesses like General Electric. The interesting thing is that even though we have the ability to scale with tech, a lot of people building businesses in tech try to build businesses in verticals that have no inherent potential for scale, or at least not enough to get to profitability before the runway cash is spent.

They underestimate the sales effort required, overcook technical requirements, avoid the cold hard problem of “What’s in it for me?”, spend too long on architecture and not enough time on marketing, build technical teams and not product teams, the list goes on…

So my position is this: Every year there is the Durban sardine run, and every year people go to catch sardines on the beach.  So when you’re working on your product, figuring out the marketing, or looking at viability, make sure that you go where the sardines are, not the fish shop in town.  It’s a simple analogy, and the take-home should be obvious — look for volume that is cheap enough to leverage.

Technology, usability, best practice, and design are all meaningless without the traffic and users to consume them.  Stop imitating in small markets, stop creating products that have no inherent human utility, stop building for the sake of the tech. Start by finding the channel your sardines are running in, then work backwards, start creating products that use global best practice but are locally relevant, stop worshipping code and start understanding commercial reality.

A few years ago I was happy just to have a shot at something, and blissfully user and technology focussed.  Today my perspective is changed, and almost diametrically the opposite.  I’m fortunate in that I’ve experienced how significant global scale affects a product and business, and because I’ve been through the long sleepless nights that went along with that experience, I’m in a place where anything other than real, quantifiable scale is just not viable, because otherwise there is no point.  If I wanted to scale linearly I would have stayed in zoology and grown a beard.

So my suggestion and challenge is this:

1. Ask yourself whether you want to go linear or exponential.
2. Ask yourself whether your niche, vertical, market or product can do that.

If the answer is yes, then you’re on the right track.  If the answer is no, then stop, rethink, reanalyse, and correct. 

The good thing about the sardine run is that it’s predictable…