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Top Challenges in the Changing Business Scenario

To completely understand this post, I suggest first you read my earlier post on “Why this is the Best Time to be an Entrepreneur?“

So what does all of this mean? It means that the windows of opportunity to address new markets are closing much faster than ever before. You simply have less time to get a lot bigger than ever before. Each of these changes will manifest itself into a handful of challenges that every startup will have to deal with.

#1: Competition will show up faster

When you significantly reduce the barriers to entry for new companies to get to market you create more competition a lot faster. Your competition is no longer just a few well-financed companies; it’s every college kid with a big idea and some time on his hands.

For you this means that your window of opportunity to be first to market is tiny at best. You don’t have time to “feel the market out” and see what happens.

While the lowered cost of starting a company is great for you, it’s just as great for your competition. As a result, you need to be prepared for an onslaught of competitors in a very short period of time.

#2: Companies will grow bigger, faster

Telecom companies like Skype grew from startup to 50 million customers in less than three years. Google went from obscurity to a company with a $100 million market cap in just a few years. The rate at which the new generation of startups can grow is astronomical.

This means that unless you are ready to grow madly you are going to get run over by the next competitor. The maturity of the Internet has created a thriving platform for companies to scale quickly and cost effectively. Unless you have a plan in place to take advantage of these opportunities, you’ll wind up being a footnote in the history of your industry.

#3: Number One will take everything

Not only do startups like Google, Skype and NetFlix enjoy the spoils of new market opportunities, they also get all the attention from the people that matter most – customers, the media and investors. If you’re not sure about that, can you tell me who is Number Two next to Google, Skype and NetFlix? If you’re like most people you have no idea.

In order for your startup company to compete (and win, because that’s what it’s all about, right?) it needs to think BIG, grow fast, and take a Number One position before anyone can possibly challenge you.

Oh, and that all needs to be done in about three years, not ten!

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This entry was posted on Thursday, June 14th, 2007 at 2:00 pm and is filed under Entrepreneur Journey. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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Top Challenges in the Changing Business Scenario

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