that clouds the focus of analysts at VC firms. It guides the focus, often to a fault, of budding entrepreneurs who attempt to fit their vision into whatever the current flavor of the month (or quarter or year) may be.
Of late, there are terms and categories, memes all, capturing the imagination (and thus the focus and the inclination) of VCs and startups alike. The “Uberfication” of this or that, the blend of mobile and local services, are all the rage. Has Uber-style delivery replaced disruption? Is “disruptive delivery” the new shiny object?
What’s old is new…
Demand-based services, often combined with location, have become an acronym: LODE. It stands for the “location on-demand economy.” By referring to it as an economy, this raises the likely or apparent allure of the category to VCs. Combine local, mobile and immediacy and a “new paradigm” emerges.
Or does it?
A startup that picks up your laundry and dry cleaning, gets it done and then returns it to you. This is neither a new concept nor is it disruptive. Laundry pickup and delivery has been available for six or more decades.
The same goes for delivery of medicine, food and supplies of various sorts. Valet services, such as parking one’s car, getting a ride to the airport, delivering flowers, or cleaning your house or car or office are all emerging in abundance. What was once known as “Dial-A-Handyman” (or a maid or a florist or a Chinese meal or a kid to mow your lawn) has morphed into apps to deliver these services on demand. No longer would one dial for these things when they are simply a tap of the app away.
Some of these services have angel funding, others have received early-stage investment from VCs. Though they aren’t disruptive, new or ground breaking, and may not even be easily scalable, they may become acquisition targets, perhaps to add to a suite of services, especially if a complementary user base should exist.
But even if they are acquired, what value will they have? From a coding or programming perspective, these apps are standard IOS and Android SDK work. These sorts of reservation/pickup and return/bill for services apps have become commonplace.
Marketing trumps technology
Of keener importance in creating value — before even acquiring a user base — is design and marketing. This is where branding, USP and differentiation play an important role.
Branding, marketing, sales and design are not the sorts of topics one reads about in an environment in which technology is the darling of the business press. These critical elements, plus research — the “R” in research and development — round out and support the technology. They contribute to achieving success. Design that is pleasing to the eye is as important as an elegant user experience. Tech creates the user interface, but it is marketing people or product specialists who guide the interface to reflect the designed and desired experience.
Product development must be the result of digital and business strategy. The entrepreneurial big-picture aspiration, “Will it scale?” must grow and be realized via strategy inclusive of all of the pieces of the product pie. No longer is it true that a team of smart coders working 38 hours a day, existing on pizza and Mountain Dew, for almost no money, can create the next ________ (you fill in the blank — everyone has their favorite unicorn, IPO or buyout model in mind).