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Ognjen Regoje

I make things that run on the web (mostly).
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You can't fork a company

There is so much duplication of work in tech. For a community that touts its efficiency it’s incredible just how inefficient it is as a whole.

There is no functional mechanism for an individual to approach an established player in a market and pitch an improvement to the process and then test and execute that improvement.

There’s no fork functionality for companies.

A marginal improvement on an existing concept spawns an entirely new company that has to start from scratch.

Here are some examples.

Specialized job boards: for remote work only, nomads, older people, or startups. All of those are just booleans in existing job boards. But they all need to redo the entire base concept first. They all need to re-build having users and posting jobs and applying. 99% of the system is just duplication. The improvement is definitely marginal, it’s not an entirely new business by any stretch.

Travel sites: flights, cars, hotels, all are duplicated. I don’t remember seeing a trully new concept in a long time. Hipmunk is exactly an example of duplication of work. Their big thing was sorting by agony (if I’m not mistaken, that’s what they called it). It was a combination of price, time, stopovers, etc. Great idea, but not a thing to build a business around. Now, lots of flight sites have exactly that.

HRM and CRM: I’m grouping these even though they are very different. The symptom is the same. There are incumbents. And then there are newcomers whose main value proposition is a different design.

What is there?

A lot of companies have half-baked incubators and competitions that look good on promotional material. But they often don’t really take it seriously or agressively enough. I’ve yet to hear of one that integrates the winner directly into the core business as a matter of priority.

An argument can also be made that creating a new company and then getting acquired is the way capitalism accomplishes this. That’s only partially true. I’d guess most startups fail due to issues that existing businesses have gone through. They made mistakes doing the work that’s already been done. The failure might or might not reflect on the innovative part, but there isn’t a way to tell.

What should be done?

I’d set up an incubator that has deep ties to industry leaders. Membership would include a commitment to an annual budget. The cost would probably be a couple of middle management salaries, and unused money would be returned, of course. Members would also have to commit to allowing new ideas to be integrated into the existing business.

The incubator would vet pitches and decide if they’re suitable for any of its members. It would also be the one design the initial integration — how the existing business would provide support — in an impactful but not overly distruptive way. It would also lobby on behalf of the startup to actually get that integration done.

The new startup would be an independent entity and would answer only to the incubator. The incubator would be involved in ensuring that the startup roadmap fits the existing business.

Projects would run on a fixed timeline with clear and measurable objectives. At the end of that, a decision is made to either ‘acquire’ the startup or discard it. A year or two, with the support of key market player, would be plenty of time to find out if a concept is feasible. The acquisition would appropriately compensate the founder and allow them to continue working on the project.

On the other hand, for pitches that don’t quite make the cut as a full-blown business the incubator could make a hiring recommendation. Designing a formula for calculating agony is clever. It might not be enough to start a business around but having that person work for the business would be very valuable.

These suggestions might seem counterintuitive an as if they’re cannibalizing the parent organization, but that’s the entire point of The Innovator’s Dilemma.

In the worst case though, this could be a high level interview for someone that might be able to immediately function at a high level of the organization.