When I was … In the open market of the 1990s, our CEO handed out recently published books.Cross the crackI told the executive team to read it to understand why scaling soared in speed. We’ve gone from zero to $ 60 million in revenue in four years, published with a market capitalization of $ 1 billion, and then got stuck.
I noticed that the author, Geoffrey Moore, was trapped in what he called “chasm.” This is a difficult transition from visionary early adopters who are willing to put up with imperfect products and mainstream customers who want a more complete product. This framework for marketing technology products has been one of the standard basic concepts for adapting to the product market for 30 years since it was first published in 1991.
Why have the eye-popping optimistic VCs and entrepreneurs have fallen below market size across the technology and innovation sectors in recent years?
I’ve been wondering why venture capitalists and founders make the same mistakes over and over again. This mistake has become even more apparent in recent years. Despite our overwhelming optimism, we continue to misunderstand the potential market size. The market size has proven to be much larger than we all dreamed of. Reason? Today, everyone is an early adopter. The Peter Drucker mantra-innovate or die-is finally here.
A clear example of our investment portfolio is the database software company MongoDB. Looking back at this series A investment note on a disruptive open-source NoSQL database startup, the opportunity for a company to disrupt an industry subsegment and successfully capture some of the potentially growing markets: I was impressed with the bold prediction that there would be. In the future, annual sales will reach $ 8 billion.
Today, we recognize that our products are appealing to most of the market. It is projected to reach $ 68 billion in 2020 and approximately $ 106 billion in 2024. It is projected to generate $ 1 billion in revenue next year. The expanding market will probably continue to grow for years to come.
Another example is Veeva, a vertical software company that initially focused on the pharmaceutical industry. When they met the company in a Series A round, they showed us a classic hockey stick slide and claimed to make $ 50 million in five years.
We overcame concerns about market size when we and our founders concluded that they could achieve at least hundreds of millions of revenues with the help of pharmaceutical companies and expand from there to other vertical industries. Boy, we were wrong! Five years later, the company submitted the S-1 and generated $ 130 million in revenue. Today, the company is projected to reach $ 2 billion in revenue execution next year, with a focus solely on the pharmaceutical industry.
Veeva is a pioneer in “vertical SaaS”, a software platform that serves niche industries, and has become a popular category in recent years. Another example of vertical SaaS is Squire, a company that my partner Jesse Middleton’s Angel invested in as part of a pre-seed round before joining Flybridge.
After 30 years, ‘Crossing the Chasm’ is due for a refresh – TechCrunch Source link After 30 years, ‘Crossing the Chasm’ is due for a refresh – TechCrunch