There is little doubt about what has been the most frequently used denomination during year 2014 in the world of aspiring entrepreneurial ventures striving for global applicability. Yes, you guessed it right; we are talking about “Uber for X”.
The usage of the line “Uber for X” currently borders to a cliché, and we are many who are already feeling a little sick to our stomachs whenever we encounter this description of a new company. However, in all our loathing, maybe trends like this are just something we have to accept as the entrepreneurial landscape evolves to something truly valuable for customers?
Sometimes a business model comes along which disrupts and impacts the world almost beyond example. It has happened many times through history and will with all certainty happen again. The funny thing is that we have seen quite many extraordinary novel models in the last decade, where Silicon Valley is always eager to declare that “this is the future” with an authority that makes the earth tremor.
However, we live in a world when the critics and naysayers oftentimes get the most viral attention for stepping out of the worshipping choir. We perceive similar behavior to be characteristic of geniuses: “the one who dared to think differently”. But is it really a sign of genius to attack everything that appeals to a broader group just by intrinsic spine reflex or having a feeling of what will go viral?
The last years the wheels of business model reinvention and quick copying has begun to spin faster and it is undeniable that many concepts do make a huge impact and survive in some refined form or another. Simply, it seems as the digital revolution carries implicit attributes which are bound to unleash continuous boost of serious creativity followed by a tiresome wave of wannabes. In any case, this is the way industrial dynamics work and probably always will work. Variation, replication and selection are some fundamentals in evolutionary economic theory. It only seems as if the pace is escalating.
We have for instance seen the breakthrough business model of iTunes and the ecosystem of Apple products emerge the last decade. Successively, we have also seen industrial disruption by music and video services relying on premium and freemium models. What is called “the sharing economy” also broke new terrain and probably impacted the startup community in unprecedented ways. Following in the wake of this phenomenon were variants of related business models of which the one of Airbnb probably gained the most attention. These are some current examples and we are sure that we are forgetting some, but you get the picture (oh yeah, crowdfunding…).
Many are the thinkers and digital contributors who have put their thoughts about concepts such as “Uber for X” into taunting texts and articles. Where is the creativity? Where is the novelty? What many journalists fail to see is that the terminology is just working as an efficient categorizer which makes concepts easier to grasp more quickly. The business landscape is still largely similar to what is historically has been and the same forces are at work. It is just good old industrial evolvement as usual and we have to live with it.
Actually, if we were not so quick to criticize a venture we would might not miss out on the ones which actually have potential, no matter what our gut feeling tells us at first. After having quickly grasped the larger picture of the business model we can begin to ask more important questions, such as how the company is really differentiating and setting itself apart from the competition.
It is easy to argue that investors are throwing money at useless copycats in redundant fields of application of a disrupting and apparently universal concept. Of course, when it comes to hyping a certain business model this is always true to some extent – but there is a reason the money is called risk capital. A few years ago we got knocked with concepts fitting the “Spotify for X” description. Similarly, a little later we got overwhelmed with the “Airbnb for X” equivalent.
Drawing from previous encounters with “Y for X” descriptions, we need to zoom out and (as always) put history into perspective before we condemn concepts labeled as “Uber for X” and devote ourselves to ignorant and automated bashing of alternative applications of the business model. Many of them have actually left a lasting legacy in a variety of fields.
Of course, the business models themselves might have severe negative impact on society and its inhabitants. Whereas some of the recent examples of disruptive business models just changes the competitive business landscape in the Schumpeterian spirit of creative destruction, some others might have more disastrous implications. For interesting examples of why the business model created by Uber might not be inherently good, see this article from The Economist and this one from QUARTZ (for instance).
However, what we are saying is that the issue regarding whether the society benefits from a disruption or not is a whole different question which we are obviously aware of; see for example the Mistbreaker article “What do Low-Wage Strikes Imply for Robotic Development”. This article merely regards if it is wise to despise concepts just because they wear a certain label. Might the behavior of condemning the replication of a concept, just because of its redundant nature, mislead readers into biased judgment (or lack of judgment)?
Sure, sometimes the critics really have a point and when some startups actually builds their businesses as consultants for creating a “Y for X” venture, even the most open-minded individual feels a feather tickling down the throat. For instance, the company Near-Me acts as an advisor for creating your own “Airbnb for X” and another one called Mowares helps you build your “Uber for X” equivalent. However, both companies ask the business community a very valid question: “why do people starting sharing businesses need to reinvent the wheel?”
A widely distributed poem (yes, a poem) from QUARTZ provides a great little moment of neatly packaged entertainment and source of contemplation. The poem is “made of descriptions of startups as an ‘Uber for’ something by the tech press”. The number of company types mentioned is large and the message is easily receivable. The question is if they are all inherently the same just because of their overall description, or if some of them actually have success attached to them.
When focus is shifting away from the label and redirected towards the real offering things get more interesting, as we implied earlier in this article. For instance, as Forbes highlights there is a plethora of new startups describing themselves as “Uber for alcoholic beverages”. The article makes an interesting case about how a company called Saucy is trying to set itself apart from its competition. Seemingly, there is a battle within the niche of a niche ongoing – and the reality is that somebody is probably going to win it.
Powerful and innovative business models does not only challenge the old way of doing things, but also create whole new playing fields. Thus, one needs to disaggregate the area of inspection in order to make a valid prediction of a company’s success or failure. The exercise of constantly being able to zoom in and out is something the tech press needs to learn from economists and investors. A valid judgment of a company can only be made when multiple perspectives are taken into account.
Note: Yes, we realize the paradoxical nature of this article in terms of “stepping out of the worshipping choir” – but nobody is flawless