Feature or Company?

by iamclovin • 16 years ago

65 25 16 years ago

param• 16 years ago

This advice makes sense to me, and I would personally never want to open something that's a feature for someone else. However, there are startups in this space that get angel/vc funded all the time (Rapportive).

I guess I see the following scenarios could make this work:

1. Build a 'feature' that is complex enough that the other company will see value in just acquiring you rather than eliminating you.

2. Work for early mega-adoption so that you can pivot to larger scope/better product based on feedback

shadowsun7• 16 years ago

I absolutely agree with (1). In fact - now that I think of it - it's probably why products like SuperDuper still sell well after Apple introduced Time Machine.

And that perhaps suggests a corollary: 3. Build something that the other company will never build (even if they could).

E.g: Apple will never make blogging software/a powerful, dedicated feed reader. It's not in their DNA to do such things.

jscore• 16 years ago

Welcome to platform business. Anytime you build on someone's platform, using someone's API, you're at risk.

Microsoft did that well against a little known company called Netscape.

mkramlich2• 16 years ago

Well, they bought Spyglass's browser, and pulled the rug out from under Netscape. The lesson is don't be the next Netscape. Be the next Spyglass.

patrickaljord• 16 years ago

Betting your business on hoping to be the next Tweetie or Spyglass is pure lottery though. Not worth it.

nandemo• 16 years ago

I don't think that's a good parallel. Windows is an actual platform. Microsoft thrives on third-party software that runs on Windows. There are tons of things you can build on Windows without worrying about competition from Microsoft.

Twitter is more like an app than a platform. Building little apps for Twitter is like writing features for MS Outlook. You can be bought by Twitter or MS but it's a risky proposition.

Luyt• 16 years ago

This happens with World of Warcraft, too. Someone makes an AddOn which enhances WoW with a great feature. Then after some time, Blizzard incorporates the feature in the base game, and the AddOn is obsoleted. I've seen this happen numerous times over the years.

maushu2• 16 years ago

Not exactly the same thing. I'm not aware of the details regarding AddOns in WoW but I don't think you can monetize from them.

tl• 16 years ago

There used to be sold addons at one point (it's possible but piracy is extremely easy), but Blizzard made paid addons a TOS violation.

dpritchett• 16 years ago

Not directly, but the addon repositories have good SEO and they run ads.

mkramlich2• 16 years ago

There's two standard responses to this point.

One, that the risk of that happening should have been obvious at the start, so it's silly to feel burned.

Two, if you do build some add-on feature to someone else's platform then the challenge is to do it so well that the company behind that platform offers to buy you. Tweetie was so good it could not be ignored, Twitter loved it, they wanted an app, buying it would save them the effort of writing their own, plus talent is scarce. Thus, they get bought.

pierrefar• 16 years ago

Also, the threat of being competed against may never materialize. Facebook can build so many apps, but they won't build them all.

This, I think, leads to the real litmus test for me: how sure are you that the company is 100% committed to being an open(ish) platform rather than building out its product? The parallels with Microsoft, Apple, and Facebook are quite interesting to explore.

lizzy• 16 years ago

If your plan is for the company behind the platform to buy you, you need to consider carefully the kind of cash they have for acquisitions and how often they do talent acquisitions. The chance is much higher with some companies than others (assuming your product is worthy).

ojbyrne• 16 years ago

Or use the add-on feature as a path to a larger product. I.e. a twitter client could be expanded to aggregate updates across different sites a la seesmic.

houseabsolute• 16 years ago

I wonder how things would have gone if these companies had patented the features they built and then sued Twitter to prevent Twitter from implementing them. You could argue (or, I could at least) that this is what patents were made for.

JoachimSchipper• 16 years ago

Wait, patents are for suing someone who has actually built something (that wasn't too innovative) over something that isn't innovative at all? We are talking about rather obvious things here, after all...

notahacker2• 16 years ago

Patents might have been built to protect unique and game-changing innovations simply being copied by a major plyer in the market, but they certainly weren't designed to stop people from building obvious enhancements to their product because someone else did it first.

The patent review process wouldn't work quickly enough to save them anyway.

Tarski• 16 years ago

Whilst you might not create a stable business out of a Twitter feature, if you can implement a feature that lots of people want for a time when no one else provides it you could make a lot of dosh in the short term.

fookyong2• 16 years ago

as you said, that's pretty much a recipe for an unstable business.

3rd party platform + a feature that everyone wants + makes money... it would make zero sense for the 3rd party to sit on their hands. you're either going to be acquired (lottery) or, more likely, they will implement the feature on their own and you'll be both out of a revenue stream and have a piece of obsolete software on your hands.

good for hackers with ADD and I see nothing wrong with building this kind of thing for teh lulz etc, or to promote your real app.

very strange when you see VC-funded "features" though.

iamclovin• 16 years ago

Even Foursquare/Gowalla look like features which can be out of business by either Facebook/Twitter

OoTheNigerian• 16 years ago

I think the first step is not to name your 'company' Tweet something.

Secondly, Ask yourself who controls the future? All these Tweet Co's that are running for the skies could have created something that integrated with multiple platforms and could create value independently even if not on a large scale (ala Zynga).

What amazes me is that most of these feature businesses do not have even the email addresses \ of 'their users'. In my book, no email, no acquisition.

Feature or Company?

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