Tuesday, October 09, 2007

Dealing with small start-ups: The good, the bad, and the ugly

Network World

Wide Area Networking




Network World's Wide Area Networking Newsletter, 10/09/07

Dealing with small start-ups: The good, the bad, and the ugly

By Steve Taylor and Jim Metzler

Over the past two or three decades, both of us have spent a lot of time dealing with start-up companies. In the next couple of newsletters, we will deal with what we see from our side of the buying cycle as the good, the bad and the ugly of dealing with these companies. We’ll also eagerly await to hear from you about your experiences.

We’ll start with the good.

Probably the best thing about start-ups is that they tend to bring innovation to the marketplace. While there may be some notable exceptions, as a rule, if there’s a revolutionary new idea or even a “better mousetrap” that makes life easier, the first products come from a small company. (Of course, by the time the idea becomes mainstream and you find it in a product, the start-up may have been purchased by a larger company.)

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So one of the most exciting parts in our experience of working with start-ups is that we’re constantly fueled with new ideas. And since a lot of our analyst practice involves providing second opinions on new product ideas and helping predict whether these new products will successfully meet a burning need, this provides the excitement and the knowledge to stay on the leading edge of developments. Of course, we’re sure that many of you – especially those of you who have the energy to adopt “leading edge” and even “bleeding edge” technologies – find the same excitement there.

Another benefit of working with start-ups is that they tend to be rather well funded – at least if they’re lucky. For the customer, this often means that there are plenty of price incentives to work with them, especially if the customer is willing to help with testing and/or to be a reference account. And, of course, well-funded companies are attractive for analysts to work with to help define strategic directions and messages.

But, as we’ll note in the next newsletter, there also can be some downsides. For instance, if you are buying from a start-up because of their way-cool new technology, you need to protect your company (and your job) by making sure that they have enough funds to be around for 2 or 3 years, “just in case.”

In the meantime, let us know about your experience with start-ups and we’ll start gathering the feedback for you.


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Contact the author:

Steve Taylor is president of Distributed Networking Associates and publisher/editor-in-chief of Webtorials. For more detailed information on most of the topics discussed in this newsletter, connect to Webtorials, the premier site for Web-based educational presentations, white papers, and market research. Taylor can be reached at taylor@webtorials.com

Jim Metzler is the Vice President of Ashton, Metzler & Associates, a consulting organization that focuses on leveraging technology for business success. Jim assists vendors to refine product strategies, service providers to deploy technologies and services, and enterprises evolve their network infrastructure. He can be reached via e-mail.



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