Editor’s note: Mrinal Desai is co-founder and CEO of addappt, developer of an iPhone address book app that your friends maintain. He was also the first business development manager at LinkedIn. Follow him on Twitter @mrinaldesai.
Curly: Do you know what the secret of life is? [Holds up one finger.] This.
Mitch: Your finger?
Curly: One thing. Just one thing. You stick to that and the rest don’t mean shit.
Mitch: But, what is the “one thing?”
Curly: [Smiles] That’s what *you* have to find out.
For startups, a lot has been discussed about how to play the market: mobile first, web second. Many startups present themselves as mobile-first operations. Larger companies like Facebook are now saying they are a mobile company – not surprising since their mobile DAUs for the first time surpassed the desktop web DAUs.
These discussions about whether to be mobile or web first mimic discussions that take place about companies in the retail space: Should we open stores in BRIC countries, Europe or Latin America? And then should the store look like those at home or built locally to fit the culture?
But what exactly is it about the mobile market that changes the rules of the game and why might this be the best thing for startups?
Mind Share – Being First With A Differentiated Product
The size of the screen, the pattern of time availability and our “location” in the real world lead to a more single-task orientation than when confronted with the desktop web. One does one task at a time on the phone, and it tends to capture undivided attention for that short time span. Accordingly, the device aligns itself to bursts of one-task activities – there is less time (and room if you consider the screen size) for distractions.
I want to get somewhere and I need directions, and I don’t want to easily get distracted with news or a game. It’s lunch time; I want to eat and want to know which restaurant I should pick, so I pull up reviews – I don’t want to easily get lost in my email at that time. If I am responding to an email, it is going to be short and I am not going to switch to another app until I am done (I might on the desktop). I have downtime waiting in line, so I cut ropes, slash fruits or crush pigs with my nimble fingers. I am in bed, and I want to catch my news quickly. It is all about making decisions quickly. Mind share enables that.
This has led to an inherent difference from the web – the “one-thing” mobile app ecosystem versus the “many-thing” web. You have to look no further than the growth of the app economy where four out of every five minutes on a phone are being spent on an app. Or consider Apple’s recent announcement of 40 billion downloads, half of which were in 2012 alone.
On web, mobile or any business, companies always work hard to differentiate with that one thing with which they want to capture the user’s imagination. When you capture imagination, you get attention, and when you get attention, you get engagement, which leads to loyalty. Whether it is on mobile, web or consoles, everything else must be built and extended to protect that one thing – Gmail, Google+ and YouTube are all examples of Google protecting search. Facebook Camera and Poke are efforts to protect photo sharing on Facebook.
But what has changed with mobile is that no (large) company has been able to pull off a “fast follow” to unseat the incumbent startup who has mind share with that one differentiated thing. Some just chose to acquire the mobile startup instead – Twitter bought Tweetie and Zynga bought Words with Friends, for example.
The best thing that can happen to a startup in the mobile space today is a big company copying it.
It became evident with Facebook’s recent attempt to Poke a hole in Snapchat’s market share. Or Facebook pursuing Instagram; Twitter or Yahoo/Flickr adding filters to pursue Instagram users; Facebook (killed Places after one year of launch) or Yelp chasing Foursquare with checkins; or Apple’s iMessage and the continuing growth of WhatsApp. With almost 263 million monthly active users, Rovio comes very close to the 311 million MAU for all of Zynga. Furthermore, now we are starting to see startups that had the first-mover advantage grow even further when a larger company tried to do the same “one thing.” The barrier of entry is that mind share.
It was and is still very different in the “many-thing,” non-mobile world. We saw Myspace come from behind and dethrone Friendster and then Facebook come from behind to remove Myspace. Gmail followed fast and took on Hotmail and Yahoo Mail successfully. Internet Explorer decimated Netscape and now Firefox and Chrome are giving IE a run for its money on the desktop. Microsoft persisted with Xbox and is a leading console now. RedBox, Hulu and Amazon Prime Video are nipping away successfully at Netflix.
Before, every startup when raising capital was invariably asked the dreaded questions, “What if Microsoft or Google built this?” and more recently, “What if Facebook built this?” Now in mobile, if that is the question your startup is asked, you are in luck because it implies that you are first to market with a differentiated product. And if a “fast-follow” attempt happens, it will probably validate your product further, highlight your effort and help you gather even more mind share leading to further market share. Believe it or not, the best thing that can happen to a startup in the mobile space today is a big company copying it.
The first-to-market differentiation, that one thing, is of paramount importance, though. It was filters for Instagram, ephemerality of photos with Snapchat (the complete opposite of Instagram and Facebook), cross-platform free messaging with WhatsApp, Checkins for Foursquare or user experience with Tweetie. As Curly says, you have to find out that one thing first.
It is hard to build a consumer service, or any good business, anywhere and in any industry, but if you are first with that one thing right on mobile, a larger company being interested in what you do might be the one best thing to happen to your startup.
[Image: Jack Palance in City Slickers]