Innovations will kill startups profitability and will make the bubble burst in 2008-2018

Posted on February 25, 2008
Filed Under Startups |

My previous post has been widely discussed by different websites covering , 2.0 and I general. It seems that the link between and is a controversial issue.
What I would really like to underline is that will decrease because of and technological breakthroughs. The environment we are witnessing today is much faster than in the past:

• On average, individuals now have eight careers in their working lives.
• In 1990 automobiles took six years from concept to production. By 1997 the process only took two years.
• In 1984 the average product development cycle lasted three years. In 1990 it dropped to18 months. In 1997 it was six months and still falling.
• Most of Hewlett Packard’s revenues come from products that did not exist 24 months ago.
• It used to take 7^14 years for half of a worker’s skills to be outdated. Today, it only takes three years for 50% or our skills to be outdated.

In a nutshell, never before have we seen such fast changes in the economy. This is happening especially in highly advanced sectors like IT.
As a result we will experience huge technological advances and a fast growing number of being launched every day.
To be successful will have to:

1. deliver completely new solutions or significantly improve existing services
2. compete with clones which provide low quality services and spoil the market
3. invest in some to be faster than major companies that can easily copy ideas and optimize them

Therefore only few will be able to last longer than a season.

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One Response to “Innovations will kill startups profitability and will make the bubble burst in 2008-2018”

  1. Dennis on February 26th, 2008 12:32 pm

    Marketing is not as important as word of mouth. Digg ad youtube are now successful as they managed to become popular thanks to people telling each other about them. For startups I would recommend to save money on ads and focus on the core.

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