Friday, January 04, 2008
2008: Edge Principles - Think Bigger
Why else did almost no value get created in 2007?
A massive reason is that media players aren't thinking big. There's no scope of vision.
Consider one of my favorite lame plays - Honeyshed. A portal for branded entertainment.
Lulz. Are you kidding? Honestly - who cares?
The industry is crashing and burning, it's structural fabric has to be rebuilt, that means: new value propositions, new value chains, new market space, new industry boundaries, new revenue streams, etc.
And, instead, we keep getting stuff like Honeyshed: the same old lame thing.
It's kind of amazing.
Look. You can't be a revolutionary unless you're, well, revolutionizing something. Offering not just something new - but something audacious, big, sweeping, grand, epic.
The size of the things we're focusing on just don't cut it. Even if they're successful - so what? The marginal value they're gonna create is tiny.
Part of the problem is venture guys. They're so trapped in either glad-handing or spreadsheets, they seem to have forgotten what truly radical innovation looks like.
But a huge part of the problem is entrepreneurs. The current crop of entrepreneurs just isn't thinking big enough.
There are no shortage of massive problems next-gen media plays can help solve. Global hunger? Check. Healthcare? Check. Moral hazard across the financial system? Check. The loss of social cohesion? Check. The massive shift of global labour from town to megaslum? Check. Exploding demand for energy? Check.
Simple example. Subprime crisis, global mortgage meltdown, etc. But all Zillow's doing is pricing houses. That's now a knock on the Zillow guys - I think Zillow rocks. But I think the opportunities open to it are far vaster than the opportunities it's pursuing. How about fundamentally redesigning the way houses are bought and sold?
"Branded entertainment" - and all the other puny ideas we've had - are failing to create value because they solve no real economic problems.
In fact, they're non-ideas. Compared to the above - which are very real, very pressing economic problems - they're lame, nothing, nonexistent, tiny.
In 2008, everyone across the venturescape and mediascape, I think, would do well to think much (much) bigger.
In fact, there's a deeper economic principle at work here. In a discontinuous world, incrementalism is deeply toxic. It plunges us more and more deeply into competence traps, and leaves us more and more vulnerable to competitors who are busy revolutionizing industries, markets, products, services.
Hi Umair, it's David G from Zillow.
Great post; info-tainmant is just the tip of the value creation ice-berg.
Real estate is undergoing tangible changes but they are certainly more evolutionary than revolutionary and I suspect the same goes for other industries as well. In retrospect, what most urgently needed to change in real estate was the consumer's level of education and so, access to information (in the form of Zestimates etc.) has been the most well received change offered to real estate consumers. Innovations like Zillow's Make Me Move marketing tool also added value to numerous transactions in 2007 but for the most part, the theme was empowerment through information. This educational phase seems to be a prerequisite to consumers recognizing and using new value-adding consumption opportunities.
FYI: in 2008 Zillow will change the way that mortgages are bought and sold. We will launch a new product in the lending space in the first half of the year. Watch our blog for more details.