The Path To A Huge Market Is Through A Small Market
Edition #002
Introduction
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Chasing Daylight
by Eugene O’ Kelly
Eugene O’ Kelly was the former Chairman and CEO of KPMG and he was diagnosed with a terminal illness at age of 53 - an inoperable Brain Cancer, when he was at the peak of his career. With just another few months left for his death, he set out to write this book.
Eugene set out asking himself two questions, even at this stage of life - “Must End of Life be the worst part” and “Can it be made a constructive experience - even the best part of life?” A brilliant account of looking at life, work, family and how one could still plan it better, when things that one didn't plan hits them.
In this episode, Ashwin Damera who is the Co-Founder and CEO of Eruditus talks about importance of learning from failure before success, the importance of Product-Market Fit, Prof. Vijay Govindarajan’s Three-box solution and emerging aspects of learning science.
Mike Markkula is considered as the most important early stage investor, who backed Steve Jobs and Steve Wozniak, when they were just about starting the journey of building Apple. His impact on Silicon Valley and the world far exceeds his visibility and fame.
By 1974 he had met a personal goal to become financially independent and had developed a list of 52 things he wanted to do, so he resigned from Intel. One of the things he decided to do was spend one day a week (Monday) advising entrepreneurs who were launching their own ventures. One of the entrepreneurs he met in 1976 was Steve Jobs and Steve Wozniak. And as they say rest is history. He remained on the board of Apple for 20 years. He recounts his experiences and brings back some great memories of how things took shape at Silicon Valley and Apple at that time.
The Path To A Huge Market Is Through A Small Market
After we read the article by Paul Graham on Billionnaires Build, we are putting our thoughts about some of the points he had made in that article.
Normally, we hear people talking of words like the elevator pitch, addressable market etc. Paul Graham makes a point that usually the path to a huge market is through a small market. He calls it the ‘Larval Market’ - small but a growable market. The perfect example of a larval market is Apple’s market, when they started-out in 1976. How many companies or start-ups think this way?
We hear a lot of large companies wanting to behave and think like a start-up. Again, if they want to make this philosophy successful and want the desired outcome, they must at their core have the DNA, ‘Make something people want’. It might be a new need, a new way to satisfy an old need and not only just new need but one that is uncertain. How many big companies and their executives incharge can handle uncertainty that a start-up goes through? This will precisely define the success of these initiatives.
Competitors rarely kill start-ups, execution does. What an amazing point. We see a lot of start-up founders being worried of competition with similar services or platforms or product features etc. But, rarely enough time gets spent on what it takes to execute the idea well. And that is a long and volatile journey which cannot happen by just hiring or delegating it to people but being in the trenches with them.
Most often we hear sentences ‘What’s your exit Strategy’ and ‘What’s your valuation during exit’ etc. But, Paul says the billionnaires he has seen, don’t work for the money. The ones who really grow rich are the ones who keep working. Is that a work ethic that we can build, be it many rounds of fund raise, secondary exits etc.
The forgotten importance of relationship between founders, specific expertise in the domain and the qualities of the founders. This is something that is always overlooked and we see this extending to even a big company where some of the successful executives display these qualities with their team and their peers.
Three lessons which we learnt from this week’s missions:
How to remain positive when there is chaos and crisis around you, is a craft that everyone needs to build, as we live in an uncertain and unpredictable world. Hence, understanding how to be at your best when things are planned or unplanned is a critical skill we have to build in ourselves to succeed.
There is a difference between learning and education. Traditional education methods delivered by institutions can only teach us so much. But, to remain on top of your game, trying new forms of continuous learning is becoming mandatory. It’s a personal investment you have to make in yourself to be relevant. Expect nobody else to pay for it.
If you are thinking of a start-up that has to be successful like no other, asking fundamental questions around if it’s a new need that you are solving or solving it in a new way is critical. If there is no uncertainty in your idea, then it may be worth taking a relook.