The Speed Fallacy (AKA "Half Assed Product? No Problem! Half Assed Positioning? Big Problem!")

Many 'dynamic' entrepreneurs, CEO's and their VC's talk about 'speed-to-market.' They suggest that you work hard and fast to rush something out of the door.

"Release Early! Release Often!" they say.

"Just put something out there and see what sticks." They advise you.

"Allow the market to lead you to it's sweet spot." They declare.

Or they quote Shakespeare - "There is a tide in the affairs of men, Which taken at the flood, leads on to fortune. Omitted, all the voyage of their life is bound in shallows and in miseries. On such a full sea are we now afloat. And we must take the current when it serves, or lose our ventures."

To me, creating an unnecessary sense of urgency smacks of fear-based thinking. Agreed, sometimes you do need to catch the tide. For example, if you are Steve Case and you're trying to merge your business with a much larger business using your hyper-inflated share price at the peak of the dot-com boom, it does make sense to rush into execution.

But when you are starting a new business, this sense of urgency can be misplaced.

Here's why:

Your most precious and limited resources are your management effort, attention, time, energy, confidence and enthusiasm. The second most important resource is the morale of your team-members.

If you squander these precious resources on an ill-conceived, ill-positioned, me-too kind of product, you may land-up in a challenging situation. Every move you make either takes you away from your positioning statement (and makes you look more like your competitor) or deepens your differentiation. Not only that, when you launch a half-thought through product, you will land up accumulating early-adopter clients. While these people are likely to be quite forgiving, you will still need to maintain them and keep them reasonably satisfied. If you decide to change your positioning and go after a different target market or create a new product, you will land up dividing your attention with the first product and the new initiative. And you'll land up fighting multiple battles with multiple competitors.

A Fool Moves. A Wise Man Travels.

So what should you do?

Understand that there is no rush in coming out with a product. Do it at your pace. And in your own time.

What happens if somebody else beats you to it?
Nothing!

If you understand differentiation, you realize that there are an infinite number of ways that you can position your product to an infinite number of target customer segments. For example, even though Coke launched about a hundred years before Jolt, Jolt was still able to gain market share with it's tag-line "All the sugar and twice the caffeine." or the de-facto tag-line "The soft drink of the elite hacker." Or consider that Google launched it's search service years after everybody had declared search to be a closed game.

In other words, if you do things right, only one of two things can happen:

- The stars line up right and you win big (a black swan event that you do not control)
- Somebody else wins big but you at least win (which can also mean a sizable exit for you.)

But if you hurry up to launch a me-too, undifferentiated competitor, then you land up with a business that takes enormous will-power and effort to sustain or differentiate (evolve into a Star business.)

Also, remember that understanding your customers and the competitive landscape and developing a unique perspective is far more important than working on the nitty gritties of product development, raising finance or hiring people.

When you are launching a new product or service, you need to keep reducing the scope of your offerings to the point where only your differentiating feature remains. For example, if you are launching a new search engine to compete against Google, you need to think of only one thing that Google does not do well and focus all of your efforts on doing that one thing really well. For example, Google does not have a good record for user anonymity. It is known to record everything about everybody using it's services. If I were creating a competing search service, I would say that my search service does not record anything about anybody and make a big story about the fact that Google can endanger your future by recording your search history. With this approach, even though my search service may not get 100% of the search market, we may get 1% of the search market. And this 1% of the market may even forgive the fact that our search results are not on par with Google since they care so much more about privacy and anonymity.

Another thing to remember is to get the order of activities right. You should not worry about hiring people or raising finance if your positioning and differentiation has not been thought through. Your goal should be to create a new category by conceptually dividing the market in an entirely new way.