New Unique Idea vs Market with Lots of Solutions

So, today I read the below thread from Jon Youngfook @yongfook

My view on "launch a unique new idea" vs "enter a market with lots of existing solutions" has flipped over the last few years.

I used to think you needed something new. Be first to market, get all the customers!

Now I think the existing markets are a better bet, here's why...

— Jon Yongfook (@yongfook) April 8, 2024

The text of the thread

My view on “launch a uniquely new idea” vs “enter a market with lots of existing solutions” has flipped over the last few years. I used to think you needed something new. Be first to market, get all the customers! Now I think the existing markets are a better bet, here’s why…

Validation already done - this is often the hardest part of an early stage startup. If you’re entering a big market with lots of existing products, this is essentially already done for you. You get to skip a very time-consuming step. A small piece of a big market can be all you need - and often it can be much bigger than a market you have tried to create yourself.

“Unique / New” attracts early adopter types - this can be good, but it can also result in you attracting users who don’t have a solid business case. Those are the ones who love your product, but aren’t ready to pay for it.

Big competitors don’t have any tech advantage - nowadays we are all using the same tech as big companies.

The competition doesn’t have any specific technical advantage anymore. In fact… Big competitors drop the ball eventually - over time either their products get too bloated, or they move up market (enterprise) and alienate all their SME customers. Seen this happen again and again.

It’s still important to have product-founder fit of course. If you launch something you are indifferent to, and have no way of accessing a customer base for, it’s going to be a brutal slog. So don’t do that.

But as long as you have some sort of spin on an existing big market, and you can articulate that well, and build a good product, I think there’s more room for more competition than people realise 🚀

inb4: “yongfook said to create a copycat” don’t do that! but don’t be afraid of creating a product in an existing big category like CRM, website builders, etc. as long as you have a fresh approach to the existing space.

My comments

I completely agree with Jon Youngfook and huge thanks to him for that amazing thread. I was completely convinced of the relevance of the above during the development of the first version of the LEIpapa platform. For those who don’t know, LEIpapa is the registration agent for issuing LEI identifiers. There are many such registration agents and they all have more or less the same functionality, namely, they help clients register, renew, and transfer LEI codes.

However, this is just the first step for our project since we are building the largest corporate register based on the global LEI system. And, we must pay tribute to the old market participants, they have already validated our first stage as successful.

We are currently looking for investments to implement the second stage of our project, namely, connecting corporate registers and entering local markets. In this version of the application, client pages will also be available (finally!!!), which will be the main competitive advantage of our project.

Thus, it is not necessary to always build something new from scratch and with a new idea. The market is globally large and everyone now has almost the same access to technology, so you have to dare!