Business Today - Dec 2022 - Jan 2023 issue

In-Depth
veloping within a fast validation cycle and using
small groups of early beta test users which
would act as early adopters of a larger market
segment.
For established companies, it’s better to consider
these, when using startup tactics and lessons,
as more of an evolutionary step rather
than a revolution. Most are already operating
according to a successful business model and
provide effective products/services to customers;
it is about creating fresh opportunities for
revenue and growth through new market entry,
and unlike startups, companies with a solid
position within their industry face less risk.
Startups born in economic downturns show
the importance of value-added products
Both the local and global economies are
dealing with heightened inflation - creating
the biggest macroeconomic challenge in the
modern era of central banking — with Egypt’s
inflation reaching a five-year high of 18.7% in
November 2022, according to the latest data
by the Central Agency for Public Mobilization
and Statistics.
On top of that, there is a 98% chance of
a global recession as we move into 2023, according
to research firm Ned Davis (NDR) —
NDR’s recession probability reading has only
been this high twice before, in 2008 and 2020
— while the Organization for Economic Cooperation
and Development (OECD) expects
the global economy to avoid a recession next
year.
With this amount of uncertainty, companies
may decide to slow down on new businessbuilding,
however, startups tend to shine during
this time, looking at it as an opportunity to
break into markets with fresh offerings.
Many of today’s biggest disruptors were born
out of recessions and succeeded by providing
clear value to customers, and new twists to classic
industry models.
The Great Recession (2007-2009) witnessed
the creation of Airbnb and Uber, both of which
began as ideas to earn money during a difficult
economic downturn. The biggest takeaway
from their climb to success? Delivering services
and products that create value, whether it is
monetary (Airbnb’s hosts and Uber’s captains)
or convenience for end customers.
Another lesson gleaned is developing a
product/service with a strong focus and differentiation
rather than investing in launching
the new digital marketplace or solution
that combines the best of several competitors’
features and offerings, making it too broad
and difficult to differentiate from others in
the market. Focus on developing a great initial
product with innovative technology at first,
with a list of possible follow-on products that
can be commercialized down the line to stay
ahead of the competition.
Generally, a sustainable competitive advantage
requires value-creating products, processes,
and services that are unmatched by today’s
competitors, and simplifies the customer’s
journey; it is also important to plan content
and new services/products to maintain your
position as you scale.
Startups tend to lean towards a “focusing
on the foundations first, and then optimizing
later” mentality, a mindset that companies
should consider to keep up with the rapidly
changing business landscape and the continued
influx of disruptive startups.
While successful startups’ rapid growth,
scalability, and high adoption rates are great
to look at, keep in mind that these innovative
companies/grown-up startups also run the risk
of being disrupted by a new generation of agile
upstarts that will use the same techniques
and business models to their advantage, emphasizing
that the importance of understanding
the journey to reinvention and innovation
will always be continuous.
Successful business-builders
look to integrate new
technology…while accelerating
decision-making by
making it autonomous
Many of
today’s biggest
disruptors
were
born out of
recessions
and succeeded
by
providing
clear
value to customers,
and
new twists
to classic
industry
models.
www.BusinessTodayEgypt.com January 2023
49