On August 23, 2013, my Harvard Business Review article, The Problem with Incubators and How to Solve Them, was published. At the time, there were 7,500 incubators and accelerators in the market.
There is a very real knowledge gap in the early stage start-up game, on both sides of the table. First-time entrepreneurs lack the seasoning to captain a steady ship through turbulent waters. Inexperienced friends and family (and, increasingly, crowdsourced investors) lack the ability to gauge the viability of a business, or to mentor naïve entrepreneurs.
This knowledge gap, I have come to believe, is best filled by savvy incubators. However, there are over 7,500 business incubators around the world. Most of them fail.
I don’t know what the number is today. I do know that the phenomenon has now spread globally.
I just did a search on LinkedIn for “Business Coach” and found over 175,000 results.
A similar search for “Startup Mentor” yields close to 125,000 results.
Well, if I could have a word with all the mentors and coaches that are out there, this is what I would say.
In the One Million by One Million online curriculum, almost eight years ago, I decided to put in a line as a joke: “We’re working on a chip that can be implanted in your brain and it will transfer ALL the entrepreneurial knowledge from my brain to yours. However, this chip is not quite ready yet. So, in the meantime, please study the curriculum and learn the methodology of entrepreneurship that we have designed.”
Well, little did I know that this would cease to be a joke by 2018.
In fact, in the next decade or two, perhaps, this sort of implant will become the future of education.
As I noted in my recent article SaaS Companies: You Have an Unprecedented Opportunity, there is an amazing level of potential for corporate innovation in the current environment, both internal and external.
Any company that has built a substantial business in any software category has core competency within its folds. It has highly capable engineers who have developed some degree of domain knowledge in their sphere. It has product managers who are in touch with customers. It has sales engineers who are in regular and even closer touch with customers. It has sales people who know the customers and the competition well.
Last week, I was on a panel at the Silicon Valley Directors’ Exchange (SVDX) on Robotics and AI: How will Boards Embrace Tomorrow’s Technologies?
One of the issues we discussed was what happens to displaced workers who lose their jobs to AI.
These days, Silicon Valley is not the darling of the world anymore. Rather, it is facing a techlash for all sorts of issues. The foremost among these is automation and the prospect of robots destroying the livelihoods of people en masse. Of Artificial Intelligence becoming a threat to humankind.
All over Silicon Valley, in Board Rooms and in private parties, the Future of Work is a much-visited topic. Almost every major company has an AI product or an AI-enabled process initiative under exploration. I have spoken with numerous entrepreneurs who actually have software products in the market that are replacing 4000-5000 jobs at each of their customer sites.
The current market is full of really interesting SaaS companies that have built up at least $100M in annual revenue run rate (ARR). Some have gone public. Some are waiting in the wings. There are also many more that are in the $50M to $100M ARR range.
They serve different segments. Some serve verticals. Some horizontal enterprise functions. Some large niches. Some enterprises. Some mid-market. Some SME.
Together, the SaaS market is a healthy, robust, exciting cauldron of innovation.
Unlike Social Media, Search or e-Commerce, SaaS is not an oligopoly. [ref: An Oligopoly, After All This?]
And these SaaS companies that have achieved critical mass in their own segments now have an unprecedented opportunity of scaling to become much larger businesses by broadening their footprints.
They can look within, and look outside to identify the growth levers.
Let me explain.
Tech is becoming an oligopoly of a handful of titans dominating the subcategories: Google (Search), Facebook (Social), Amazon (Commerce). Then there is Apple (Device). In Software, the picture is a bit more encouraging with Microsoft, Oracle, SAP, Salesforce.com, IBM, and a whole host of other fast growing SaaS companies still maintaining a healthy competitive dynamic.