Entrepreneur vs Inventor
A Far Side cartoon I saw years ago illustrates the difference between an inventor and an entrepreneur: two caveman were standing around what apparently was the first fire ever sparked by mankind. With their hands in the air and a look of sudden surprise on their face, one shouts "Hurray, I discovered fire!" while the other shouts: "Hurray, I discovered insurance!"
Of course, this is not historically true, since insurance was invented in Italy in the 14th century and only became widespread after a major fire occurred in London around 1666 (interesting, isn't "666" the number of the devil?).
The point is simply that it takes a sharp knowledge of human psychology (fear, doubt, insecurity, etc.) as well as mastery of mathematics (in this case, actuarial science) in order to create customer value.
Okay, here's my little insight: The Internet is like fire!
People today, at least in the developed world, take Internet for granted. It is as normal and common as a matchbox or lighter (although nobody has approached me in public and asked, "Excuse, would you have an Internet connection?").
People take the Internet so much for granted that they are missing tons of opportunities for MAKING SERIOUS MONEY FROM IT.
Here's a great example of elegant Internet entrepreneurship: in the mid-90s, two engineers presented a business idea to a panel of venture capitalists, but were turned down. As they walked toward the door, an investor asked: "Do you guys have any other ideas?"
They looked at each other and blurted out that they actually were thinking about offering a free email service to people, who would have to subscribe, and so on and so forth.
The rest is history: they created Hotmail, bought two years later by Microsoft for hundreds of millions of dollars!
Yes, technology played an important part, but isn't email quite simple? The value I think was in the humongous user base which was built almost auto-catalytically, that is, by itself and automatically, through sociological momentum (i.e. a Hotmail user would email someone, and an invitation to join Hotmail would always appear at the bottom of the email, so the recipient of the email would become a Hotmail user too -- sounds very much like viral marketing).
In short, the business design was quite brilliant.
So in your case, how will you make a lot of money from the Internet?
Of course, this is not historically true, since insurance was invented in Italy in the 14th century and only became widespread after a major fire occurred in London around 1666 (interesting, isn't "666" the number of the devil?).
The point is simply that it takes a sharp knowledge of human psychology (fear, doubt, insecurity, etc.) as well as mastery of mathematics (in this case, actuarial science) in order to create customer value.
Okay, here's my little insight: The Internet is like fire!
People today, at least in the developed world, take Internet for granted. It is as normal and common as a matchbox or lighter (although nobody has approached me in public and asked, "Excuse, would you have an Internet connection?").
People take the Internet so much for granted that they are missing tons of opportunities for MAKING SERIOUS MONEY FROM IT.
Here's a great example of elegant Internet entrepreneurship: in the mid-90s, two engineers presented a business idea to a panel of venture capitalists, but were turned down. As they walked toward the door, an investor asked: "Do you guys have any other ideas?"
They looked at each other and blurted out that they actually were thinking about offering a free email service to people, who would have to subscribe, and so on and so forth.
The rest is history: they created Hotmail, bought two years later by Microsoft for hundreds of millions of dollars!
Yes, technology played an important part, but isn't email quite simple? The value I think was in the humongous user base which was built almost auto-catalytically, that is, by itself and automatically, through sociological momentum (i.e. a Hotmail user would email someone, and an invitation to join Hotmail would always appear at the bottom of the email, so the recipient of the email would become a Hotmail user too -- sounds very much like viral marketing).
In short, the business design was quite brilliant.
So in your case, how will you make a lot of money from the Internet?
posted by Super Peter at 1:01 AM
<< Home