Don’t underestimate how difficult it is to get a first-mover advantage. Twitter, Skype and Facebook are the exception, not the rule.
- Being the first mover isn’t as important as most entrepreneurs believe: first movers can advertise opportunities that attract the attention of larger competitors.
- Being the first to market isn’t as important as staying ahead of the competition.
- Maintaining the first-mover advantage means creating value others can’t imitate.
- It’s easier to serve a small, high-margin niche than to create a first-mover advantage. For example, consider Germany’s Mittelstand, which comprises numerous successful small-to-mid-sized companies. Many of these companies may sound “boring,” e.g. pump producers that target specialized, high-margin markets. But the “Mittlestand” frequently generate high margins over long periods of time, and are sustained by regular process innovation.
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