We recently had the honor of hosting Nasreen Dhanji from Bluesky Innovations, who came in to speak to us about innovation. The message was clear: to build a successful business you must be innovative and how this can be done was the main topic of discussion.
Nasreen highlighted four key ways in which you can be innovative. The ways which stood out most were that to innovate you must eliminate things which are consumer challenges and pain points. You should ask yourself. what does the industry do that no longer delivers value and whether you can eliminate this to reduce costs and create a more lean business?
By targeting innovation, one can move away from intense competition. In “Blue Ocean Strategy”, Chan Kim and Renée Mauborgne call these areas “red oceans”, where there is only bloody competition, as opposed to “blue oceans” where one can separate themselves from their competition through innovation and operate in an ocean of their own. Once in a blue ocean, a company avoids competition and has the chance of creating a monopoly. Peter Thiel, the co-founder of Paypal and first investor in Facebook, made headlines with his article “Competition is for Losers” where he claims that creative monopolies can be good for society.
To exemplify this, Nasreen gave the example of Spotify. Spotify allowed you to stream music legally, whereas you previously customers had to resort to illegal means. Not only was this illegal but it was marred by potential viruses, and it cost the music industry billions. Eliminating pain points for both the paying customers and the artists led to an extremely successful company that had a successful IPO last year. They could have simply competed in the red ocean of illegal streaming, but instead, they chose to separate themselves through innovation.
When thinking of a startup idea, or even if you are already working on one, think innovation!