Start. Grow. Exit

Build a platform, not a feature

pexels-photo-218443Many of us use software products every day. Therefore, it’s not unusual that we might find a lot of features that are missing in certain products that we still regularly use. Sometimes it’s very hard to understand why a certain feature is missing as you know that a lot of people would find it useful and it would undoubtedly improve the product.

Now some people might think that this is the perfect starting point for a start-up and so they might try to build this feature set inside the ecosystem of another company (e.g. YouTube, Google, Microsoft, Facebook, …). Their product will add certain functionalities to that ecosystem, and their monetisation strategy is based on charging for the use of the new and improved tools.

I consider this a very dangerous approach: one that rarely works well in the long run. If you build an awesome set of tools and they work, there is a high likelihood that the owner of the ecosystem is going to copy them and make them free. And you can’t really blame the owner of the ecosystem for doing that, as they probably had this feature set on their development roadmap as well.

You might even have an exit strategy in which the owner of the ecosystem will buy your company. This might happen, but negotiating with someone who can build or even just rebuild your product better than you can and who can easily distribute it to their large user base puts you in a really bad negotiating position. They might only want to pay you a price that’s close to what their costs for building that feature set themselves would have been. It’s therefore much better for you to build your own platform instead.

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