Sometimes, a few things happen concurrently that drives home a point, and last week I had one of those moments. Last week, I taught several sections of a marketing class at Duke’s Fuqua School of Business, focusing on new product launches. One question that came up repeatedly was how Apple was so successful despite not following many of the principles I was outlining, particularly on involving customers in the product development phase.
Then, over the weekend, one of my favorite blogs (Both Sides of the Table by Mark Suster) wrote about why you should not try to replicate Instagram’s $500 million raise (read the post, Don’t Try to “Pull an Instagram.” Here’s Why …).
In the case of Apple, they can make product development and marketing decisions without extensive consumer testing and still succeed because they have an incredibly visionary product development team, led by Steve Jobs until his death. The problem is that your creative team is almost certainly not as exceptional as Jobs and Co. Look at the team objectively (including your skill-set) and put together a list of reasons that they are orders of magnitude more talented than your competitors’ (e.g., Zynga’s, Playdom’s, EA’s, Rovio’s, TinyCo’s, Breaktime’s) teams. It is interesting that people always use the example of Apple, which says to me they are the exception and there really aren’t many (or any) other companies that can operate against the rules. If you cannot come up with the case that they are that much more talented, focus on building your business the old-fashioned way (analytics and hard work) to create a great company.
With Instagram, Suster makes the case that the underlying economics make it very unlikely that a company can raise a large round and turn around and have a great exit (again, read his blog post for a very well-reasoned argument). Just as with Apple, you need to look very closely at your situation and see if you can be such an exception or whether you should grow and finance your company in a more traditional manner.
My point is to put your ego aside and focus on the fundamentals that increase the odds of creating a successful company. Statistically, the chances of you being that one-in-a-million outlier like Steve Jobs is, well, one in a million. Rather than count on winning the lottery, lead your social gaming business the right way and you will create a success.