Last week it was announced that Gumroad just raised $7 million dollars from KPCB. Gumroad is based on the super simple concept of selling something with just a link. The concept is simple, almost too simple. Though it is potentially very powerful if it becomes the go to way to sell content on facebook and twitter.
When I met Sahil, the founder of Gumroad, 9 months ago one thing that stuck out was him saying that he thought Gumroad had the potential to become a thing. I was intrigued, usually people don’t talk this way about products. Plus he has a track record of working for startups that have become things: pinterest and Turntable.fm. Despite that track record it was difficult for me to understand how this simple concept would become a thing and also why gumroad would take off instead of an inevitable clone or even a preexisting competitor adding this feature.
When I heard the phrase “the potential to become a thing”, I immediately knew what he was referring to but I still have trouble defining it. Becoming a thing is about being the category killer but with a social cred twist.. Instagram became a thing for sharing photos, Kickstarter became a thing for social fundraising, path is on the verge of becoming a thing for sharing intimate moments of your life and Quora is becoming a thing for answering and asking questions. Becoming a thing comes from a combination of having a strong brand, a great user experience and powerful network effects when applicable. Becoming synonymous with the action that your site allows for is the culmination of becoming a thing. This is how startups are able to take off and become successful de facto monopolies.
Certain products become a thing because they are is so much better than the competitors. Google’s ascent to becoming the top search engine is a great example of this. They had an anti-marketing marketing style that became hip and a simplified user experience but where they really shined was in having search results that were much better than their competitors.
Instagram is an example of how having a great user experience and becoming cool can lead to a startup taking off. The company took off because it became a thing. It became cool to take and share photos with the service. Of course the great user experience was part of it and helped the initial spark. Though now, even if a competitor had the same or even a better user experience it’d just be called a clone and almost certainly couldn’t catch up. Using instagram is the modern day (or should I say retro) version of the kodak moment. Instagram says the service is about “a world more connected through photos” and I think the service gives users a photographer’s lens for viewing the world. Many of my friends excitedly say I have to “instagram this” when referring to taking mobile photos.
A thing can become a fad. Draw Something may end up being in this camp. It may endure with some level of popularity but certain things can have short life cycles, especially games. It is difficult to differentiate between what will last and what will fade. I think products that fulfill basic human needs will sustain while a lot of “non-franchise worthy” games will fade in popularity.
So how does a startup become a thing? That is a hard question and I don’t think there is a straightforward answer. Usually it can’t be predicted before hand. This is why some companies can shoot up in value so quickly once they find product-market fit. The following are areas that startups should focus on if they are hoping to become a thing:
- Have well known founders and/or advisors.
- Have a relentless focus on a great user experience.
- Have a strong focus on marketing and building a brand. Recommended reading: The 22 Immutable Laws of Marketing
- Have a deep understanding of human psychology
- Have a focus on authentic growth (think Instagram versus socialcam)