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The 6 Most Valuable Letters oif All Time by Dave Chase Building Consensus by Jody Levinson Entrepreneurship in Philanthropy by J, Gregory Dees and Paul Shoemaker Zachary Price on Keeping Your Email Secure and Private Ken Helleburst and Mark Sher on VOIP for Business Kim MacKay on Compliance Management Larry Sivitz on SEO PR Art Vacca on Choosing a Co-Lo Partner Lawson Abinanti on Positioning Your Message Michael Lisagor on E-mail Etiquette Dave Chase on CRM Systems Dave Chase on Email Marketing Shannon Zastrow on Content Management Systems Vivek Bhaskaran on Conducting an Online Survey Peter Christothoulou on Paid Inclusion Karen Howe on Streaming Media Carl Robinson on Picking Top Talent Charlie Gillette on Distributing Knowledge Anywhere Cris Hagen on Strategic Team Building Tracy Corley on Making Your Brand Promise Dan Japhet on a Balanced Media Diet Dave Chase on "Interactivity" Joe LePla on Tight-Budget Branding Jim Brosseau on Software Solution-Finding Marilyn Holt on the New Rules of Fundraising John Jerome on Viral Marketing Marilyn Holt on Raising Small Money Ian Lurie on Relationship Marketing Muriel Guilbert on Virtual Press Tours Curt Rosengren on
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The 6 most valuable letters of all time
By Dave Chase, Altus Alliance Fred Wilson once commented on whether technical innovation or business model innovation was more powerful for a startup. He cites examples of both being drivers. I'd argue that business model innovation is more durable. Mark Leslie (a rare CEO who took a tech company from $0 to over $1B in sales) has commented on the fact that execution risk for most startups has shifted from technology to go-to-market as development tools have gotten so much better. Consequently, technical innovation has become much easier to replicate. One only has to look at a couple of the most sustained successes in tech over the last few decades to see how busines model innovation has been very durable -- IBM and Microsoft. Having competitive (though not always the best) products was clearly important but not sufficient to drive their long-term success. For IBM, it has been their world class sales & marketing machine that allowed them to weather their darkest days yet still have over $60B in revenue. With Microsoft, they've had two monster successes that boiled down to 6 letters encapsulating their business models that each changed the rules of the game in their market space and proved to be very durable. Windows -- The 6 critical letters were O-E-M and I-S-V. There's little doubt that OEM'ing Windows to hardware companies rather than taking the path to maximize short-term profits as Apple did in the 80's and 90's by controlling both the OS and the hardware was instrumental in their success. Secondly, their investment in and success with ISV relations dwarfed any of their competitors. The byproduct was many customers had no choice but to go with Windows as that was the only platform that their applications ran on top of. While Microsoft certainly has taken a beating for the issues that come along with a platform that has infinite combinations of software and hardware vs. a limited set with the Mac, they have happily taking that beating as they ran to the bank with trainloads of cash. Office -- It boils down to 6 letters again -- b-u-n-d-l-e. Initially they just did "marketecture" (initially there was no integration between Word, Excel & Powerpoint) by slapping three products in the same box for a combined much lower price than buying WordPerfect, Lotus 123 and Harvard Graphics. Over time, the products became more integrated but they changed the discussion within I.T. shops from individual productivity apps to having an Office suite. Their competitors were slow to move and then got severe indigestion while acquiring companies to compete with office. There were 6 other letters that were also critical in Office's success -- S-e-l-e-c-t (another business model innovation). Select was the name of their volume licensing program with enterprises that made Office very difficult to unseat. Each of those 6 letters for Windows and Office have probably generated more combined profits than any other product over their lifespan in the computer industry. [24x7] |
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