Lenny's Newsletter - Why now?
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Short answer: Having a strong “why now” certainly gives you a better shot at building a large and enduring business (for the reasons I cover below), but it isn’t absolutely essential. Companies like SpaceX, Airbnb, Pinterest, DoorDash, Instacart, Facebook, and Netflix had little if any why now. But these companies all executed like crazy in a large market, and in many cases succeeded because they rode a new trend later in their life (e.g. Netflix and broadband). Bottom line, if there isn’t a great reason why your startup is only possible now, don’t despair—you still have a shot at building a big business, but know that you’ll need to work even harder. Long answer: With the help of a bunch of smart investors, Twitter, and my own research, I’ve collected why nows for dozens of businesses (see below), and through this research, I’ve come to some unexpected conclusions:
Huge thank-you to Sarah Tavel, Ann Miura-Ko, Bill Trenchard, Josh Elman, Alexander Taussig, Garry Tan, Eric Vishria, and everyone who shared their insights in this thread for contributing their wisdom to this post 🙏 1. A strong why now creates two distinct advantagesWhy do investors look for a why now? Because the odds that you’ll succeed go up. Investors are bet takers, and they would prefer to place bets where they see a higher expected return.
A strong why now—a change in the world—opens up one of two major advantages for your startup: 1. It can unlock the ability to provide a 10x better product
2. It can create a new untapped market need
If you can build a 10x better product, and/or discover a growing untapped market need, you could get away without a strong why now. Which brings us to our second point. 2. You can build a massive business without an immediate why nowPrior to this research, I was sure that you needed to have a strong and immediate why now in order to build a large and enduring business. It was instilled in me through everything I learned about investing and starting a company. It turns out this is not necessarily true. Many successful companies had no strong why now when they got started, and instead succeeded mostly through the sheer will of their founders and great execution:
You could argue that there were macro trends that explain why a DoorDash or an Instacart were only possible in 2013 versus a decade earlier (e.g. increased adoption of smartphones, growing expectation for on-demand services, etc.), but to me, these don’t feel fundamental to their success at that moment in time.
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