The Maturity Trough
Not that long ago, idea-to-code was slow & expensive. Launching a startup is much easier. As a result, there is a significant market behavior that is now occurring.
For the longest time, we as technologists could identify a market and create a unique value proposition on the magic quadrant. Depending on where you hit the maturity curve, there was ample opportunity to create a great software business. The noise and fragmentation levels were there, but the cost of development (time+money) was something that everyone faced, and infrastructure was still maturing slowing down the pace of change. But if you look at what is happening today, the process has shifted radically, and market maturity has radically changed. It is a new phenomenon; a maturity trough as I see it.
The maturity trough is driven by three core attributes; commoditization of technology; a flood of new entrepreneurs, and the (r)evolution of software business models (think .99 app, SaaS). The trough is created as a result of options/choice in a market, low cost/free models, cheap apps and believe it or not – cheap websites. These result in massive noise and fragmentation due to competition. As technologists, we often get spoiled with our own culture about how innovative businesses are becoming, but the reality is products are quickly outpacing market maturity. What this does is slows adoption, and actually drives indecision or low commitment – resulting in a maturity trough. Depending on how many companies attack a perceived (perceived because it is in front of the business “realization”) market, the trough gets deeper and wider. Price and solutions are commoditized, and consumers have options to “play” with. The commitment to deploying technology inside a company doesn’t require IT, or integration anymore – it’s now swipe-and-go, go having a double meaning -“it’s easy”, and also meaning – If I don’t like it I’ll try something else. You no longer can expect to have skin in the game from your customers from the onset.
Adoption usually lags behind innovation/creativity. It really is about timing it right – much like a surfer catches a wave. I am not a great surfer, but the analogy really paints what is happening with this maturity trough. Catching a wave is learning the ocean’s rhythm. Being early, you sit far out in calm waters watching the waves crash in. Being late, you get caught up in the churn of the surf. You have to time it right, to catch and ride the wave – see and feel the ocean’s energy and know when to paddle.
In context, Mavericks is the mecca for big wave surfing in the US, huge waves in Northern California. But for a long time, only a few surfers knew about how big the waves got there. It was a closely held secret kept only to a few. But with all things, it became public. Before long, an explosion of surfers, all wanting to surf big waves crowded the waves. Mavericks became complex, noisy – competitive.
Much like surfing, it’s easy to get a board and go out and try to catch a wave. Competition is good. It forces you to really think through your business, product and identify your core differentiators. But the unintended consequences require you to figure out how you can bridge the trough, and create a sustaining business that not only can rise out of the churn, but shorten the troughs distance to adoption. It comes back to the core of business; making it sticky, great customer service, good evolving product, value at a fair price. The essence of building a business.
If you aren’t prepared to enter a market with 25+ competitors out of the gate, you might as well get out of the game. It’s only going to get noisier.