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Nothing More Than Smoke And Mirrors

Startup announcements get lots of attention in local and national media. There is something about the optimism, the energy and the audacity of startups that makes for a good story.

Except that too many of these stories are nothing more than smoke and mirrors.

Take for example Elon Musk’s Hyperloop announcement. Here is the multibillionaire behind SpaceX and Tesla, sharing his vision for a transportation system of the future. The description of transport pods zipping “from New York to Los Angeles in 45 minutes” is the stuff of science fiction movies. (Why does it make me think of the transport tubes in Logan’s Run?) For sure, it makes a great story. But does it deserve so much press? After all, even Musk admits the price tag is huge, there are major technical hurdles, and no one is stepping up to start work on this project tomorrow.

The Hyperloop hype sounds like too many of the startup articles I read in my local paper: great ideas that lead to nothing more than a landing page, a Kickstarter campaign or a “pre-order” site. This is nothing more than “vaporware”, or premature announcements in the hopes of gaining traction (or investors or pre-sales).

Vaporware is not a good thing. It raises expectations, sets up false hopes and when you delay or fail to deliver, can destroy your reputation. The biggest danger of vaporware, in my opinion, is that it locks you into a positioning that makes it really hard to pivot out of when you need to. And as you launch your Minimal Viable Product, the odds are that you will need to pivot (major change to your target market or the value proposition) or at least iterate (changes to the functionality or design).

Startups love launch parties, but I find they tend to do them too early. It’s very tempting to go for the big launch. It makes you feel that you’ve accomplished something, while the reality is that you have done nothing other than make promises.

I admire Apple’s strategy. Instead of doing a big announcement then waiting months or weeks for the product to be available, they launch and the product is available in store right away.

The media is very hungry for some good news to act as a buffer for the otherwise depressing headlines. But don’t buy into this. When everyone is chasing the media’s startup hype machine, the smartest strategy is to quietly deliver. Assemble an “R&D Team” of early adopters, launch your Minimal Viable Product, get feedback and iterate until you have it polished and revenue-positive.

Focus on shipping your product and delighting your customers. Then when you have some real-world stories about how you’ve rocked your customer’s world, you can have that launch party to celebrate progressing to the next stage of your business growth. You will have deserved it!


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