Are Micro StartUps the Next Great Thing?
I’m sure you’ve heard of Twitter, the micro blogging startup from Obvious in San Francisco. Twitter has a simple purpose, allow users to post small blurbs of text (tweets) to the service which are read by an individual user’s followers. It’s a sweet service and does one thing really well. More than a status or presence message, and less than a blog post, Twitter fills a void in the 2.0 space. The product emerged in an organic fashion and given the rather simple and inexpensive development pathway (read Ruby on Rails) did not require a traditional start up approach.
Guy Kawasaki has launched an RSS aggregator called Alltop that resembles Twitter in that it also does one reasonably simple thing quite well. Both of these services are great examples of what I think is the next hot business trend: the Micro StartUp.
Venture capital has clearly adapted to this trend as can be seen with the emergence of the Y Combinator and the Founders Co-op among others. The business model is radically different from traditional VC models in that the initial investment is in the range of $10k to $20k instead of low to mid seven figures. Business plans are eschewed in favor of the ability to rapidly produce a functional application. Business models are often left in flux in favor of achieving first to market status. I’m still not sure how Twitter plans to monetize their service.
I’ve been preaching about opening access to content production with wikis and blogs and how this represents a radical power shift in the publishing industry. I think the micro startup phenomenon is evidence of a similar trend in the arena of idea realization. How cool is it that a small group of people can launch a product to a global marketplace with a tiny budget and a project life cycle that is measure in weeks rather than months or years?
Given that both the technology and business case for much of what we’re doing in the web2.0 space is still emerging it really makes sense to me that we try small steps that can be easily realized rather than grand unification projects that often spend longer in development than the projected life span of the product being developed.
I’m thinking this is cool.
