If You Chase Two Rabbits
Founders often ask, when is the right time to expand geographically, add a second product or pursue another customer segment? Most of the time, the answer is not yet, not until the company is quite large, perhaps in the hundreds of employees and the main challenges and questions for the business have been answered well.
When a startup pursues a new major initiative, the company divides all its key teams by two. If speed and focus are the advantages of startups, then this startup has halved its focus and doubled execution time. There are now two marketing messages, two sales pitches, two press strategies, two product and engineering teams. Rationalizing two messages can be a challenge for companies to communicate and customers to internalize. For most small companies’ management teams and employees, this doubling of complexity is overwhelming.
Second, the company risks slowing its core business. If the company is doing well enough to pursue a second product strategy, the business is onto something. Founders should ask whether faster growth and dominance in one market segment builds a more valuable business than smaller penetration of and slower growth in two markets. Most of the time, and particularly in early stage markets, a focused startup perceived to be on the path to monopolizing a market will be more valuable.
Third, the startup’s goals are no longer necessarily aligned among teams. After all, which product takes precedence when cash is constrained, press releases are numbered and customer time is capped? The startup will constantly need to decide which to prioritize - and at early stages, this balancing act is quite a lot to manage.
If you chase two rabbits, both will escape. Pick one and seize it.
Consultant - EHS
9 å¹´Nice article!
Project Consultant - Healthcare at Crown Furniture
9 å¹´Very True.....
Founder | Quality Enthusiast | Team Builder | Test Automation Architect | Public Speaker | Author
9 å¹´Its a good way to perceive things in simplistic way, as chasing rabbits. But when would you say , you have caught a rabbit, to chase another one? I would see these rabbits as targets, once someone reaches a particular target, they should formulate a strategy that, bird in hand doesn't go off (rabbit in this case) - in other words to create a strategy to sustain those targets over a period of time, before they make their minds to chase the bird in the bush.
Senior District Manager/ ABM Industries
9 å¹´Its perfectly natural to be confident in your business model and feel like you can do anything. Its an admirable quality that every business owner and entrepreneur needs to have in order to thrive and succeed, especially when considering how many start-ups surge forward with excitement, grow stagnant, and then fail. But, be careful not to over extend yourself or your people by reaching too far out of your zone of expertise and ability. Indeed, "chasing two different rabbits" means you lose your focus, stress out your people, disenfranchise your client base, lose valuable investment capital, and end up "going hungry".
Mindset Alchemist. Preparing Your Business to Prosper Today & Tomorrow. Meatball maker, yes really.
9 å¹´Tomasz Tunguz, bravo! Given the inordinate amount of time, energy and capital a startup company consumes, 'A bird in the hand is worth two in the bush.'