Asymmetry of Motivation, Ability

Many times, when people are explained a start-up concept, they would immediately say that the concept has no chance because some established companies could do it easily. In technology, it’s Google. “Oh, Google can squash that,” or “What if Google decides to do it?” they would say. In reality, many start-ups succeed in the presence of hungry big companies. It’s also true that many start-ups just get washed aside by the big competitors. So how would we know which has a chance and which doesn’t?

In his book, “Seeing What’s Next,” Christensen argues that in order for an up-start to win, they must have either or both of Asymmetry of Motivation or Asymmetry of Ability. A big company like Google, due to is “value,” must focus on big opportunities (it’s social for Google right now); therefore, it will not have the motivation to go for smaller markets. Examples of this asymmetry are some smaller SAAS areas such as data warehouse/reporting and SEO. If start-ups in these areas succeed, they can be acquired by Google but not overthrow it.

Asymmetry of ability is a bigger concern for big companies. Facebook and Twitter, for examples, have acquired abilities and asset (the users, bounded by the network effect) that allow them to survive Google, even though Google has great motivation to succeed in social. Google Buzz did garner some buzz at first, but that has cooled down significantly and it may have become irrelevant. On the other hand, I believe Color, a great idea in localization, does not have either asymmetry of motivation (both social and localization are important to Google) or asymmetry of ability (I think data analysis and creating working algorithms are Google’s strengths, and a start-up cannot overcome this). So unless Color is able to erect some sort of barrier through the network effect, it may just be swallowed up by a company like Google soon.

Google is working hard on social, which should leave a bunch of smaller opportunities available for start-ups.


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