Timing is everything pt. 2 ⌚
#58
One important slide to add to your pitch deck is “Why Now?”- basically telling any investors why now is the right time for your business to start. We know from #53, timing plays a hugely important role in starting a business and reaching product/market fit easily. Like we know, Facebook wasn’t the first social media network and Uber wasn’t the first ride hailing app. But they came out at the right time, with the right execution strategy and here we are today. Found the extract below discussing markets and different frameworks for analyzing business, Peter Thiel’s and Keith Rabois’. We’ll discuss those in depth later.
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Both frameworks need a compelling answer to ‘why now.’ There’s no chance the business will be a ‘grand slam’ if not.
Keith Rabois says “it’s the founders job to triangulate how to get where they need to get to, with what is possible today with hacks and bridges…Typically if the timing is going to work, the founder has a really compelling answer to what has changed in the world, since there are not many new ideas.”
Charles Hudson elaborates, “I always ask people why could you not do this two years ago? Why not do it two years from today? Why now? For most startups — If you missed your window by two years either way, either you’re going to be late to market and someone else is going to have figured out things and made progress, or you’re going to be too early.”
Don Valentine also echoes the importance of timing. When asked about his biggest failed investment, he says “What didn’t work was the timing of the market…the critical thing is getting a product developed where the timing of the market’s availability and market demand are simultaneous. Otherwise you are spending lots of money on developing a market which people did not tend to spend money on. Invariably, we shut those investments down.”
Valentine warns that it’s important to not be too early. “We are not interested in creating markets. It is too expensive. We are interested in exploiting markets early.” Sequoia invests in most relevant companies in an ecosystem once there’s promise an ecosystem will grow. This was best shown with Apple and the PC ecosystem. “We don’t choose people, we choose markets. Once you choose a market, there is a primary product. We rarely ever invest where there is only one product…So if we viewed the Apple Computer as a system, we had to finance one or more memory companies, disc drive companies. We had to have floppy disks, which needed financing. Disc drives that made the memory information portable…Without memory companies, the PC is nothing. So if you keep digging away at the system, what else do you invest in?…We looked at the system — the Apple computer — made over 15 investments in that category.” Those investments include Electronics Arts, Oracle, Cisco, and NVIDIA.
There are a wide set of subjective changes that make now a good time to enter a given market, including:
Infrastructure changes. Regulation, government incentives, trade barriers, competitor exits, shakeouts in adjacent industries.
Tech changes. Emerging technologies, platform shifts, patent expirations, data availability, exclusive rights.
Business changes. New sales/distribution channels, unit economics (e.g. Instacart vs Webvan), economies of scale, pricing, macroeconomic forces
Customer changes. Shifts in consumer behavior, new communities.
Article List— What I’m reading (10 articles a day x 7 days x 4 weeks x 12 months = 3360 articles a year).
African migration to the United States is the fastest-rising—in spite of Trump: I guess this is more telling on the situation on the ground in Africa. That someone would willingly jump at the chance to be in Trump’s America when compared to African country?
MARGINal: Prof. Galloway at it again trashing We and Uber.
Four Key Product Principles from WeChat’s Creator: If you’re building a tech product, might as well think like Allen who built the first super app.
The Railroad to Nowhere China Built Has Opened in Kenya: Incredible story. After building the road half way, you’re now concerned about its viability? Of course thats after Kenya has signed its mineral rights and whatever else away.
The Fall of the Muni Startup That Wanted to Upend Wall Street: I thought of a similar idea for municipalities in Ghana. Then I thought about how much headache it’ll be to go through the process and how difficult retrieving my cash would be. I advised myself accordingly.
In India And Mexico, WhatsApp Is The New Growth Hack: India, Mexico and every other emerging markets country.
Nigeria’s plans for the OPEC of cocoa unlikely to bear fruit: Chocolate cartel. Sound idea, not too sure if it’s going to work though. I guess we’d have to see who has more leverage over the other. Insufficient cold storage and warehouse facilities would make it difficult for African countries to hold out for long. It’s the cocoa farmers who’d get hurt at the end of the day. BTW, watch the cocoa episode on Rotten on Netflix.
Dakar cocaine seizure shows West African ports are easy transit hubs: LOOL. We’ve come on top oo. But I think we’re no more transit hubs… more of the product is staying on the continent. Cocaine cowboys, you know.
Undercover entrepreneurs: fearful Mexican tech startups shun spotlight: LOL I would’ve done the same thing tbh. Announce my fundraise and next thing you know, I’m being bundled into the back of some random truck? No thanks
Google Snubs WeWork, Signs Toronto Lease With Co-Working Rival: When your friends start to act brand new…
Angola: Where did all the money go? Part 1, a family feast.: This shit needs to be turned into a movie. Imagine. Africa, we do this to ourselves.
Podcast— What I’m listening to (1 podcast episode a day x 7 days x 4 weeks x 12 months = 336 podcast episodes). Broadening my experiences through others’ stories.
American Elections: Wicked Game: Remember when political parties worked together for the benefit of the country? When Democrats and Republicans put their differences aside to focus on building the United States of America? Yea, me either…because it didn’t happen. Listen to this podcast to learn the history of America and how they started with George Washington and ended up with the Don as president in 2016.
Book— 1 Chapter a day x 7 days x 4 weeks x 12 months = 336 chapters. Most books have 10-12 chapters, so 1 year = 28 to 33 books. And my book list is nearing 1000 books. Send help 🌚
Started on aunty Michelle’s book, Becoming. A light break from reading about entrepreneurs building empires. I have The House of Rothschild up next, though. 😆
📱📱Quote of the day
“High expectations are the key to everything”- Sam Walton
Remember folks: “Until the lion learns to write, every story will glorify the hunter.”