I have been involved in a variety of businesses. MapQuest was certainly the most successful. I have other businesses that had varying degrees of success and a few that just never went anywhere.

With a handful of these under my belt, I uncovered one key strategic understanding that I need to know when starting out. Will this business be riding an existing wave (following a tailwind) or will we be swimming upstream (fighting a headwind)?

There is no right or wrong answer per se, but the method of attack is different with this understanding in mind. I strongly believe that you need to build your launch strategy around this answer or put your startup in jeopardy.

What are examples of a tailwind? Cloud based services 3-5 years ago was a tailwind. Cloud-based services 10 years ago would have been a headwind. I saw this first hand in one of my customers.

In 2005, I was CEO of a document management software company with a product for K-12 school systems. One of our clients (and my favorite) was a fast-growing school district outside of Fort Worth, Texas. We worked closely with the superintendent, the leader of the program and the CIO. When we started our relationship, the thought of hosting highly confidential and private data outside of their server room was a non-starter. When I pitched them the cost-effectiveness of working with my hosting provider and doing this "in the cloud", the CIO gave me one look and we were done with that concept. I was fighting a headwind in terms of a SaaS solution.

We had to purchase the server, set it up, deliver it to them, and set it up inside their server facility. We had to put people on site. It was a complete pain in the butt and frankly cost them a lot of time and money to do it this way.

Three months later, the CIO told me that he wished that we had gone the hosting route. The headwind had shifted to a tailwind. It was the last on-premise server we ever installed.

Up to that point, our business model had to include the purchase of servers, our configuration & installation, and all of that manpower. That was the way our customers wanted to consume our product.

Successful startups need to reduce as much friction as possible in order to achieve their goals. If you want to lead the migration or pivot of an industry by positioning yourself to attack a headwind, you best be prepared to say no to many customers who are not ready to work within your model.

Given enough time and resources, you can establish a leader position but you must have the time and resources to do so. Don't think you have enough of either? Then find a tailwind.

Published on: Apr 30, 2015