Most entrepreneurs want do something disruptive--to waltz into an industry vertical, shake vigorously, and rise like cream the top.
Disruptive innovation, the sweet-sounding term coined by Clayton Christensen, is sexy, desirable, and awe-inspiring. But here's the question. Is it attainable? Can you plan for it? Or is it something that only chance and luck can create?
Most startups cannot be disruptive. Why do I say this? Because nine out of ten startups fail. It's hard to argue with the stark truth of statistics. Another reason that most startups can't be disruptive is because they don't understand what it takes to be disruptive. The pathway to disruptive innovation is filled with fast-failing, big-dreaming aspirants...and a lot of detritus.
How did the disruptive companies do it? What is their model? Their secret to success? Read on, and you'll discover the four concepts that have pushed startups enter the wild world of disruption.
1. Innovation: Disruptive companies are one of a kind.
An infographic featured in Mashable explains why most tech startups fail and why precious few succeed.
At the top of the "succeed" list is Shopkick. Why did they mushroom into a $30m company overnight? "The app is the only one of its kind," says Mashable. Forbes paints a picture of their disruptive rise to stardom, explaining, "The idea was a total outlier at the time."
Disruptive companies don't mind being outliers. In fact, they have to be.
As an example of this, how many Ubers, ridesharing apps and companies, were there before March, 2009?
None. It was one of a kind--a new mold-shattering concept.
That's why Uber raised funding like mad, rose to international notoriety, and put "sharing economy" in the modern vernacular. Now, there are Uber wannabes on every major boulevard in the world.
Uber thumbed its nose at the entrenched taxi industry because it was inherently different from the taxi industry. It was one of a kind. It is disruptive. Ergo, it is worth $40bn.
2. Marketing: People want what disruptive companies have to offer.
Disruption starts with an axiom of marketing: Get the right product in front of the right people.
If you want learn how to be disruptive, just look at companies who have failed in the attempt and do the opposite.
There is one glaringly obvious reason why most startups go down in flames: "They make products no one wants." That's not just my assessment. That's the analysis from Fortune who pored over 101 post-mortem essays. From their investigation, a whopping 42% of the defunct companies admitted that the market didn't want their product.
Let's take Tesla as an example. When Elon Musk invented his electric car, he was staring up at an army of Goliaths--Toyota, VW, Daimler, BMW, GM, Honda, Hyundai, Nissan, Ford. Were these centuries-old automotive companies really going to let an upstart electric car change their business model, enrage their executive leadership and make their shareholders nervous as heck?
It's such an obvious truth, almost embarrassing for me to write it. Ask yourself the simple face-palming question: Do people want to buy this?
If the answer is, "maybe," "I don't know," or "probably not," then you on are a fast track to being undisruptive. Change course now.
3. Business model: Disruptive companies make things affordable.
Clayton Christensen coined the term "disruptive innovation," so he's qualified to tell us what disruption is about. What does he point to as the disruptive business model?
Listen to him repeat this in his Bloomberg article:
- [Disruptive companies] made computing more affordable.
- Cars were toys to the rich until Henry Ford made the car accessible so millions of people had access to it.
- Toyota...made cars so affordable that the rebar of humanity, college students, could own one.
- This phenomenon that I call disruption is one that allows a larger population, people who historically didn't have enough money to buy a product, to afford something like it.
- The low end wins so frequently.
There is a place for high-end products, but that's not the sandbox that disruptors are playing in.
4. Attitude: Disruptive companies are led by delusional and disagreeable people.
Everything that I explained above is crap if you leave out this final and most important point.
Attitude is everything, especially for disruptive entrepreneurs.
Malcolm Gladwell, the genius who elucidates disruption for the masses, discusses this issue with eye-popping clarity.
We talk about the importance of technology and knowledge and resources, having the kind of money to make it happen. But we don't talk about frame of mind, attitude--the kinds of attitudes that lie behind provocateurs.
Ah, those provocateurs! They have the enviable trait of "being disagreeable." Most disruptive entrepreneurs aren't the smooth, sweet-talking, urbane, sophisticated cosmopolitans who appear on national talk shows and purr about their success.
In fact, a lot of them are kind of disagreeable (but agreeably so). Gladwell describes such person: [A disruptive entrepreneur is] completely indifferent to what people said about him. [This is] the first and foundational fact to understand these disruptors. They are what psychologists call disagreeable--they do not require the approval of their peers in order to do what they think is correct."
Are they friendly? Maybe. Are they fun to be around? Probably. Are they sociable? Meh. But here's the thing. They don't give a darn care either way.
Daniel Kahneman states that the entrepreneur possesses "delusional optimism." That's the attitude you must possess if you want to defy the burnout rate. Why could Steve Jobs applaud "the crazy ones, the misfits, the rebels, the troublemakers, the round pegs in the square holes...the ones who see things differently?" Here's why: "Because the ones who are crazy enough to think that they can change the world, are the ones who do."
But delusional? That's a strong term. Yes, but look at it this way. Let me put a question to you: Would you like to start a business. Spend millions of dollars. Maybe go bankrupt. Waste years of your life. Undergo intense stress. And, oh, you only have a 10% chance of making it.
Want to disrupt the world? Change your attitude. Be disagreeable. Be delusional. Now, you're ready to disrupt.
Are you ready to pivot? Your startup doesn't need to become part of the 90% mortality rate. Disruptors are winners. The path to disruption isn't easy, but it's attainable.
- Innovate something unheard of.
- Be confident that people crave it.
- Make it inexpensive.
- Be comfortable being disagreeable and delusional.
Take those four bits of advice. Smash them together. Mix them up. Swish them around. Go be disruptive today.
How are you going to be disruptive?