What Start-Ups Can Learn From Archimedes

As it turns out, Archimedes can teach us a lot.  He was Smart with a capital S. 

“Give me a place to stand on, and I will move the Earth” Archimedes

Or – in other words, “Give me a lever long enough and a fulcrum on which to place it, and I shall move the world."

 

“A lever (/ˈlɛvər/ or UK /ˈliːvər/) is a machine consisting of a beam or rigid rod pivoted at a fixed hinge, or fulcrum. It is one of the six simple machines identified by Renaissance scientists. The word comes from the French lever, "to raise", cf. a levant. A lever amplifies an input force to provide a greater output force, which is said to provide leverage. The ratio of the output force to the input force is the ideal mechanical advantage of the lever”. - Wikipedia

How does this relate to start-ups?  Start-ups are small Davids who are out to conquer giant Goliaths.  In the bible, David defeated Goliath with a lever.  A catapult with a stone is a weapon which turns a near useless stone into a giant killing weapon.

In the business world, there are plenty of levers to use.  Identifying them and using them to your advantage is an essential part of building a small business that can take on Giants.

An example. Microsoft came to dominate PC operating systems through a smart distribution deal with IBM.  IBM at the time were a massive PC manufacturer, Microsoft were tiny.  Bill Gates managed to get his DOS operating system into all IBM machines yet retain the rights to use them elsewhere.  By leveraging the massive scale of IBM, MS DOS became the main PC operating system of its time.

These days, a small online trader can leverage the marketplaces of eBay and Amazon to gain access to consumers.  A gaming company can leverage the user base of Facebook, a SaaS business can give away free products in app stores to acquire customers that they can up sell to paying subscribers.  A travel insurance provider can partner with an online travel agent to gain access to relevant consumers.  
 

Thinking of the world in terms of how to leverage the strengths of others to your advantage is a very useful perspective when you have very little in the way of money or resources.   

Got any other examples?  Please do share your thoughts…

When "No" Matters More Than "Yes"

Back in the 1990's I was Head of Operations for a niche upmarket Tour Operator, Simply Travel.  It was a great company.  We provided quality and authentic accommodation in some of the most beautiful destinations in Europe, we provided the best possible service.  We sold the business to Thomson Travel in 1999 and in 2000 I moved to an online travel start up during the dotcom boom. 

I mention this because I'd like to thank Steve Rushton (@stevemrushton), our Managing Director at the time for some sage advice.

I was busy, flat out.  As I like to get things done well, I was worried that I was not completing everything I wanted to.  Not enough i's were dotted or t's were crossed.  My to do list was never ending.  Steve said that if I had too much work, it wasn't important to finish everything, it is more important to finish the most important work first.  He said something like, "If you have enough work to fill 150% of your time, make sure you choose the most important 100%".

A few years later I was at Expedia.  I was with Dermot Halpin and we were talking about strategy.  Dermot emphasised that it's not what you choose to do that defines your strategy, it's what you decide not to do.  If you are not saying no, you don't have a strategy.

On the same theme, I came across this really helpful post today "A VC's 10 startup secrets he wishes he had known as an entrepreneur".  It's by Micheal Skok (@mjskok), a VC at North Bridge.

The ten tips he goes on to list are very relevant but I'd like to highlight one in particular that all of us can learn from, in business and in life.  He calls it "Don’t be afraid to say “no” more than “yes.”".

So often in life we want to say yes.  Opportunities are around every corner.  It's important to grasp these opportunities.  However, if you are lucky enough to have more opportunities than time, what will define you is what you say no to, not what you say yes to.

Why Geese Fly in V Formation

A few years ago I used to row.  It's an amazing sport which requires intense dedication.  But when it comes together the feeling is amazing.  8 guys and the cox in a boat, moving in perfect harmony in 3D, powering the boat with finesse so it planes over the surface of the water.  It's possibly the ultimate team sport.  If one person doesn't show up, you can't take the boat out.  If one person doesn't train as hard, they are carried by everyone else.

Great teams achieve more together than they could alone. 

I was reminded of this today by an BBC news article, Birds' V formation mystery 'solved'. "Scientists say they have solved the mystery of why birds fly in a V formation, by tracking critically endangered birds that were being trained to migrate".

This wasn't news to me.  Our rowing coach had told us about the V-formation of flying geese as a way to explain to us what real team work was.  The birds (as you can read in the article) take it in turns to fly on the front.  This is because the other birds can benefit by flying in the slipstream of the front bird.  One bird works hard so the others can save energy.  Then they switch.  By doing this, they all use less energy that flying straight into the wind all the time.

It's the same for cyclists.  If you watch the Tour De France or any other pro race, you'll see that the "protected riders" are the team leaders.  They save their powder for the big finish of the day and their teams do the hard work to get them close to the finish with a much energy left as possible.  The team leader finishes the job.  In cycling, even on Sunday club ride, each rider is expected to "take their turn" on the front, dig hard and deep for a few minutes before returning to the slipstream of the bunch.  By doing this the speed of the group increases overall.

Needless to say there's lots of lessons to be learned here for how we can be a great team together at work.  It's fairly obvious, but here are some takeaways...

• take turns on the front
• share the effort
• dig deep when it's your turn
• stay together
• head in the same direction

I leave you with this video for inspiration...

What Can Be Horizontal Will Be Horizontal

When you last took a flight, did you not just sit back for a moment and marvel at how so much complexity had been brought together just so that you could hop on a plane and skip across the planet?

Within the air travel industry, there are travel agents, global distribution systems, airlines, regulators, airports, aircraft maintenance companies, insurance companies, aircraft manufacturers, engine manufacturers, fuel suppliers.  When they all operate successfully together, you get air travel.

Passenger flights are decades into their evolution, it's a mature business.  And - it's horizontal.  Specialist companies support many airlines at the same time, the airline does not own and control all the parts of the value chain.

I'm curious.  What about the web?  How will that play out?

The history of human civilisation is full of examples of networks being built and exploited.

Canals, railways, ports, gas, airports, sewerage, roads, electricity, telegrams, telephones, mobile phone networks, social networks, logistics networks, GPS, the worldwide web.

One could argue that these networks form the most tangible poof of human social progress.  They provide the means for us to advance our society with learning, health, wealth, knowledge and lifestyle.  However, we often take them for granted.  We take more notice of the applications that are built upon these networks.

What's interesting is that in an early stage market, companies can form that create a network and also create and sell the products and services for that network.  It's a vertical market.   Think about how modern mobile phone operators run infrastructure, market to customers, own stores etc.  Increasingly though as the market matures, specialists come in that can supply a horizontal layer and do so incredibly well to multiple companies.

Eventually you end up with horizontal specialists.  Companies that specialise in applications, companies that run networks, companies that run services that connect applications to networks.

The internet is one hell of a network.  I'm really curious to see if horizontal will beat vertical.  What will be the role of Facebook, Apple, Google, Microsoft, Cisco, Samsung, Intel etc in the next 20 years?  Will they try and own as much of the top to bottom (consumer to network) vertical themselves or will horizontal players dominate?  My hunch, just looking at the way that all other human endeavours seem to evolve, is that horizontal will trump vertical.

If that's the case, it opens up all sorts of possibilities for businesses to thrive is as yet under-developed horizontal services or specialist products and applications consuming those services.

The web at 25 years old is the 21st Century Gold Rush.  It's far from over.

It Took 7 Years to Kill The PC Era

The rumours of the first Apple iPhone were around in 2006.  Sceptics posted blogs such as "Why the Apple phone will fail, and fail badly"




For years phones were getting smaller, cheaper and with more and more functionality.  Here was a phone that was more expensive, larger and (for the first release), not that much in the way of functionality.  It didn't even have copy and paste.

I guess the sceptics were wrong.  Apple stormed the market with a new product and the world quickly followed.

I remember a friend bringing a new iPhone to work as soon as they were first launched back in 2007.  He was hooked, loved it! I was intrigued. I liked it but I considered it too expensive to switch.

He was an early adopter.  He bought to be ahead of the curve, cool, hip.  He was also prepared to take a product that wasn't really that great yet (only 2G, 6 hour battery life) and pay a premium.

In our household, the first smartphone appeared in 2009.  That was when the price came down and the network connectivity improved (3G).  I was in the "early majority" group.

Last week, for the first time, every adult in our household now has a smartphone for the first time.  An old phone was being replaced and the standard replacement now for a contract phone is a good value Windows or Android phone.  Smartphones are now in the "late majority" stage of consumer adoption.

This is born out by the stats.  In the UK we have;

62% smartphone penetration
87% smartphone users searching for local information via their phone
73% smartphone users researching products via their phone
39% smartphone users who have made a purchase via their phone

This is information gleaned from Google's Our Mobile Planet Report, which is is a really useful tool to check the above numbers for any country in the world.  You can also drill down by usage, age and gender.

The world has moved on.  The PC era is over.  The mobile era is here.