Tuesday, 2 September 2014

Not that disruptive, maybe

We have seen the rise of start ups in the last few years, challenging existing and much larger companies for a slice of their marketplace. 

The speed at which start ups can move is predominantly down to their size, which their larger competitors can rarely match. Other areas of difference are much more difficult to measure but culture and creativity would be in there too.

Given start ups are a threat, the obvious way to eliminate them would be to buy them. There will probably be a price point where this becomes attractive, especially to any investors in the start up. 

If the motivation of the investor is to make money then this seems to achieve the goal, as long as the price and timing is right.

It could even be a strategy of a start up to be bought out, essentially making a nuisance of itself and forcing a competitors hand. 

Maybe larger companies should see start ups as a form of R&D? Start ups innovate quickly, test the market and show a direction for the larger company to exploit. They even come with customers rather than just a bunch of patents.

So, I'm not sold on the word 'disruptive'. Start ups seem to stimulate rather than disrupt.

No comments:

Post a Comment