Resisting The Siren's Song
‘’Half-birds, half beautiful maidens, the Sirens were singing enchantresses capable of luring passing sailors to their islands, and, subsequently, to their doom. Daughters of the river god Achelous and a Muse, they were fated to die if anyone should survive their singing. When Odysseus passed them by unharmed, they hurled themselves into the sea and were drowned.’’ *1
Siren’s were creatures in Greek mythology who lured sailors to their deaths by seducing them with their singing.
The siren’s song that will lure you to your death in business is ‘vision’.
According to Laseter et. al (2007), approximately 48% of companies had failed 5 years in, during the dot com bubble in ’99–04. *2
‘’Approximately 50,000 companies solicited venture capital to exploit the commercialization of the internet.
Within the larger set of initial entrants, however, the five-year survival rate was 48%.’’
During those days it was (and still is) believed that it’s crucial to have the first mover advantage.
You have some vision for the future and then you get there first and get big fast. Doing so will put you in the dominant position in that market.
However, we now realize that’s a fallacy.
Those companies had more market share because others needed to play catch up but very frequently they also stepped on landmines others managed to avoid, translating in them making the journey faster.
And more often than not those landmines killed that business.
It’s crucial to realize that your vision is likely to be a hallucination, which is why we need to test it and why the first test can’t be the final product released into the market.
This problem isn’t just constrained to startups.
In big business, I’d argue it’s even worse.
They’re equally likely to fall for the siren’s song but because they have more people involved, more capital than a startup, more clout and more time, it takes longer to discover that their assumption might be wrong.
In a startup, the lack of people involved increases the speed at which decisions can be made for obvious reasons.
The lack of money restricts the runway in terms of how expensive a product can be and how fast it needs to be launched.
The lack of clout means there’s no prior reputation they can lean on, so they not only have to build something for a small, well-defined group of people, they have to make it something those people truly love.
They can’t ‘’just slap an Apple logo’’ on it and call it a day. (A common criticism I disagree with but serves to illustrates my point.)
But then why don’t we see these failures more often?
Because they’re hidden. Saved by the fact that most companies don’t do disruptive innovation, they tend to be risk-averse.
So the majority of their innovation lies in incremental innovation.
The kind where you optimize an existing process.
But if we look at companies taking a shot at disruptive innovation (a job usually performed by the startup ecosystem) this flaw quickly becomes apparent.
Just take a look at big launches gone wrong:
Apple’s Macintosh with its Superbowl commercial.
‘’ Introducing the Macintosh, Steve was still young, trying to move too fast, and not regulated enough to really create a good product, a successful product.
It was a lousy product.’’
Google with their Facebook and Twitter killer, Google+:
Just as the sirens died if anyone passed them by unharmed, your hallucinations will die if you test it with customers.
The antidote to resist the siren’s song is the same for companies big and small:
Don’t trust your vision, trust your users.
You need to be able to look into the eyes of your users (physically!), see how they interact with your product and get their feedback, iterate and go back.
Sirens. Retrieved from https://www.greekmythology.com/Myths/Creatures/Sirens/sirens.html
Kirsch, David and Goldfarb, Brent D., Small Ideas, Big Ideas, Bad Ideas, Good Ideas: ‘Get Big Fast’ and Dot Com Venture Creation (November 2006). Robert H. Smith School Research Paper No. RHS-06–049. https://bit.ly/2YLKBXF
Ziegler, C. (2013, June 27). Steve Wozniak on Newton, Tesla, and why the original Macintosh was a 'lousy' product. Retrieved from https://www.theverge.com/2013/6/27/4468314/steve-wozniak-on-how-the-newton-changed-his-life