The world around us has been changing dramatically for the last 15 years, but the last six have by far and away been the most exciting, filled with the most opportunity and the most innovative ideas. For the last 12 years I've been fortunate enough to be surrounded by many of the exciting, energetic people who are responsible for these changes, which means I've been exposed to the cutting edge of technology, marketing and digital media. Even today I have the opportunity to continually evaluate new companies and technologies and hypothesize how these will be applied in the general marketplace.
So I thought this week I would share a few of the ways that I evaluate these companies, so that next time you have the chance to meet with their representatives, you too will take away from that meeting the sort of experience that I get to take away each and every time!
First of all, is the idea defensible? This is the first big metric to determine if an idea will be successful. By defensible I mean, can someone else enter the same point in the landscape and offer the same services seemingly overnight? Can you defend your idea and be differentiated from the others who will inevitably enter into the marketplace? I find that defensibility is the most important metric when I evaluate one of these companies and determine if clients or partners might be interested in working with them. It's the USP (Unique Selling Proposition). It's the point of differentiation. It's what makes your idea different from everyone else's. Of course, there's always room for more than one in a category, but I find that I am less interested in companies and technologies shooting for the No. 2 spot. Just my opinion, of course.
The second big evaluation I have is whether the idea is being marketed as the "Next Google/MySpace." My response is that this is not a strategy. Maybe it's my own ambition and excitement, but I believe that you are never setting yourself up for success when you're marketing your idea as simply the obvious evolution of an existing idea from another company. The best ideas are always evolutions of existing ideas and ideas that satisfy a need in the marketplace, but they always have a unique point of differentiation, as I mentioned in my first evaluation metric. You can frame your business in terms of existing companies, but you should be able to define yourself in different terms. If the definition of your idea relies so heavily on an existing concept, than it's possible that you haven't taken it far enough. In these situations I recommend you evaluate the idea further and develop it more in-depth to truly differentiate, and be sure you are satisfying a need that is really there.
One of the obvious questions to ask is, "Who's the team developing the idea -- and are they a proven entity?" The track record for that team is extremely important and goes a long way toward helping gauge the success they will have. If they've done it before, then they know the challenges and can probably do it again. If they have never succeeded before, then you need to know why -- and whether they learned from their mistakes.
The last big question to ask is, "What's the revenue model?" This is an important one because, regardless of the climate of the landscape today, the model needs to be more than advertising-supported. Advertising can create a lot of revenue and can certainly pay the bills, but it should never be the only revenue stream. It's a simple matter of having all your eggs in one basket. The audience is a fickle beast and you definitely need to have more than one stream to pay those aforementioned bills.
At the beginning of this article, I asked if you knew what the best job in the world was. I think the answer is, any that are involved with this industry. You rarely get bored, you never run out of things to learn, and you never stop evaluating what's next. Now that doesn't suck!