

Why Pioneers Have Arrows In Their Backs - spahl
http://steveblank.com/2010/10/04/why-pioneers-are-the-ones-with-the-arrows-in-their-backs/

======
shalmanese
There are statistical artifacts here that need to properly be taken into
account.

First, there is only ever one first mover and many fast followers. Thus, it's
not entirely surprising that at least one fast follower would dominate the
leader.

Secondly, the failure rate calculations are highly suspect due to historical
redactionism. If a first mover fails, it will still be remembered due to it's
contribution to the field. If a fast follower fails, it becomes hard to even
discover that it existed in the first place.

Think of this in terms of car companies. Ford was the first mover but, up
until the 1920's, there were almost a thousand different car companies started
by various people:
[http://en.wikipedia.org/wiki/List_of_defunct_United_States_a...](http://en.wikipedia.org/wiki/List_of_defunct_United_States_automobile_manufacturers)
. 99% of them failed, some had moderate success and a few like Toyota & GM had
enough outsized success to eventually beat Ford. Being a "fast follower" in
this case almost always meant you were dead.

~~~
btilly
Some of the examples are also weak.

Ford was not the first car company in the USA. Daimler Motor Company beat it
by over a decade.

He did not sell the first commercially successful gas powered automobile in
the USA. Alexander Winton holds that honor.

Ford did not sell the first mass produced automobile in the USA. Ransom E.
Olds did.

Ford wasn't even Henry Ford's first automobile company. The Detroit Automobile
Company was. Ford was his third company.

The most common justifiable claim about how Ford was a first mover was the
invention of the assembly line. Even so there is dispute. The concept was
patented by Olds in 1902. According to Henry Ford, Ford's reinvention was
based on William "Pa" Klann's observation of the meatpacking industry's
"disassembly lines", which had been invented in 1867. However Ford certainly
perfected it, and manufacturing has never been the same since.

------
chegra
This is a paraphrase of some of the things Michael Porter said in his
book,Competitive Advantage: Creating and Sustaining Superior Performance -
[http://www.amazon.com/Competitive-Advantage-Creating-
Sustain...](http://www.amazon.com/Competitive-Advantage-Creating-Sustaining-
Performance/dp/0684841460/ref=ntt_at_ep_dpt_2) : There is not much gain in
having a first mover advantage by itself. But, if the first mover locks up key
resources for success then that gives a sustainable advantage. This can be
done by fast followers also. The competitive advantage strategy should be to
capture resources so that competitors can't access them. For instance, he
mentioned Walmart strategy of buying key locations before their competitors
figure out that these location were necessary for success.

Other means of locking in resources may include contracts with suppliers and
with authorities or patents. The main theme is to block competitors from
resources they need for success.

------
bluesnowmonkey

      First Mover: 47% failure rate
      Fast Follower: 8% failure rate
    

This last statistic is a bit misleading. It implies that you can increase your
chances of success by waiting until someone else enters the market. But it
fails to account for those who declined to follow because the incumbent market
leader held such a strong position.

To put it another way: followers only follow if they have some reason to
believe they'll succeed. So yeah, they still do well. It does not lead to the
conclusion that you should avoid being first.

------
tezza
Pioneers always design armour where there _weren't_ arrows before?

~~~
erickindle
Lol. That is all.

------
sinamdar
Case in point for this would be Wesabe. Interesting recent article and
discussion here <http://news.ycombinator.com/item?id=1746832>

------
jayliew
Speaking of fast followers, I've just started reading this book last week
titled 'Copycats' by Oded Shenkar <http://amzn.to/cG7vm3> \- which basically
talks about using imitation slash innovation as one of available tools in your
repertoire. Read up to chapter 2 but so far I like it and recommend it, on the
topic of fast followers.

------
kscaldef
Not to argue the point that Google won in the PPC arena, but it's a little
disingenuous to compare Google's current market cap with Overture's sale price
in 2003.

------
napierzaza
Statistics on how many startups fail because of X is dubious. Who's to say
whether doing the opposite of X would improve any businesses chance at
succeeding. Even a large margin of small businesses fail in the first 3-4
years.

Are the slow starters more successful? Do THEY get as big as the "get big
fast" companies? Don't just shake the fail stick because you can do it in
either direction.

~~~
regularfry
> Who's to say whether doing the opposite of X would improve any businesses
> chance at succeeding.

Well, if you read the article, you'll see that is dealt with explicitly. 47%
of pioneers failed, according to the cited study, as opposed to 8% of fast
followers.

> Are the slow starters more successful? Do THEY get as big as the "get big
> fast" companies?

The example of Ford vs GM would indicate that they can; or at least that
there's no advantage in being first.

> Don't just shake the fail stick because you can do it in either direction.

Only if you can come up with numbers to refute the study, or a better argument
than "I don't believe this is measurable" to render it null. Otherwise you're
just waving a twig in the air.

