Thread by @parulia

Crappy technologies often win. Why?

My atomic essay for today is also a lesson from Clayton Christensen 👇🏽

I forgot to share the New Yorker CC article that I was reading when I wrote yesterday and today’s post.

It’s such a good read and amazing how spot-on and early he was to these observations!
newyorker.com/magazine/2012/…

But on to the story. Crappy technologies often win 🤮
How?

This fascinating story from Clayton Christensen is about REBAR.

What the heck is rebar? you may ask. Rebar is a form of cheap steel, and supplying it was one of those sticky annoying undesirable markets the incumbents hated to deal with.

But new entrants developed a cheaper process to make steel, and because the overall market was so tough, they started at the very, very low end of the market, rebar.

The margins were terrible so the existing players stayed at the top and ignored the crappy rebar producers.

These new entrants were content to start at the very bottom and do the extra work required for cheap.

And over time, with the cheaper cost and quality improvements they made, they moved upmarket — and eventually displaced their old, high end competitors.

This is THE classic, David and Goliath story of tech.

Other cases where the new entrants started at some boring, unattractive segment of the market? (Cue 80s music 🎶)

📻 Transistor radios
💾 Floppy disks
🚙 Subcompact cars
🖥 Microprocessor chips

...and I bet you can think of others.

Now, I won’t claim it will be easier to raise VC money, based on the sweat equity of being willing to start at the bottom 💪🏽

But with relentlessness and continuous innovation the bottom of the market can become an entry point.

There are doors everywhere; find them🚪