I am a big fan of startups, those who build and innovate. I even like the strategic advice that VCs/ex-founders give about building a business.
However, any writing of the style: "Facebook, Google, Zynga, Twitter did [x] when they were small -> So you must do [x]" doesn't resonate strongly with me. It has this underlying promise of 'if you did [x] you will become Facebook' - which ignores a vast multitude of other factors that went into making an FB. It is worth thinking much harder about how much of [x] is actually right on a strictly case-by-case basis -- depending on what one is trying to build, the problem one is trying to solve and for who.
Sometimes one has to take a different approach and build several features/product bundles in order to sell.
One approach probably is to find some overriding truths that are close to being immutable: such as,
1) make something people want (I haven't seen a counterexample to this yet)
2) nothing happens until somebody sells something (This puts focus sharply on building what will sell)
3) articulating 'why now' to the best available clarity is important in my view (even if to explain why a bigger scope may be needed now than in the past - e.g. if one has to build an HR system today, they would probably need to build a payroll integration as a feature; this wasn't true before 2013-14)
The problem of course with these that they sound super generic that they cease to be of value after a point.
I remember a hamburger restaurant that opened up. It had very good hamburgers and was very popular. The staff were always singing. It was a singing hamburger restaurant. About a year after it opened, I noticed a lot of other singing hamburger restaurants opening up. They all failed miserably -- mostly because their hamburgers weren't very good. After about 2 or 3 years the popular hamburger restaurant folded. They still had really good hamburgers, but the singing was really annoying and eventually nobody wanted to go there any more.
Interestingly, around the same time I heard of other singing hamburger restaurants in other cities. I always wondered if it was some horrible cargo cult fad, or if it was just a coincidence.
Facebook was really fun back when it was all about your profile, your friends list, and posting on other people’s walls (this was before News Feed). Communication on it was more personal and not at all about self-broadcasting or gaining an audience.
For most of us, success is likely to be via something smaller rather than shooting for the moon with some VC-fueled rocket.
Related: Dave Packard's 11 simple rules. (for human relations) (1958)
This is how google "evolved":
1. You can put ads on your site just make sure they look totally different from your content, just like we do on google.com. Their ads where on the right-side only.
2. Then they put ads on the top of the search results but they said: "yeah... but the background is totally different so there is not problem". They used a yellow background.
3. Now most people don't realize that top results are ads. All of them.
There were impossible to beat spread sheets before Excel, impossible to beat word processor before Word, impossible to beat drawing programs before Illustrator (er... I don't know if that's actually the popular thing right now...) Those loosing applications were loosing customers well before feature parity in their rivals.
That's really the secret in competing against the established competition: don't build the parts of their app that suck, and spend a lot more time perfecting the parts that are great than the behemoth can justify. Work with the rifle like precision of a team of 10, rather than the shotgun like vagueness of a team of 1000. Know what's important, what's not and concentrate on execution.
The point he is making is not that you will be the next facebook, but that if you start with a small, possibly non scalable idea that works, who knows what it could turn into. And maybe its better to do this than to try to penetrate the market with big picture bullshit.
If you followed Amazon history you can clearly see diversification was at their core. Amazon was founded in 1994 and they started to acquire other companies sooner than later . For example, IMDB (movies, not books) was acquired in 1998.
Definitely not small.
I think this advice to 'think small' could be refined to include 'find a small edge, then relentlessly exploit it'.
With that they could dominate the market with good servers and pay for good programmers. With that they deliver a very good service "for free", while others could hardly get any money.
They also get some money for clicks and advertising, and also have started dominating the advertising market. But the big money is the hidden support from agencies of the government(s).