Hyper Focus and you will go farther

This is the Chapter 18 of my e-book Silicon Valley for Foreigners, that can be downloaded for free on www.siliconvalleybook.com or purchased for $2.99 on the iBookStore and Kindle. A new chapter will be posted on this blog every week.

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In many emerging countries, founders face abhorrent conditions to run startups. It takes ages to open a business, there is no supportive ecosystem for entrepreneurs, corruption is rampant, the legal system does not work, Internet is slow and expensive, logistics are a mess, and most people do not have the means to afford popular products.

Emerging entrepreneurs learned from inception how to survive amongst the chaos. The chaotic environment faced by their startups led them to become jacks of all trades, masters of none. Focusing on just one product was never an option.

When I lived in China, in 2009, I was flabbergasted to witness local entrepreneurs running totally different businesses at the same time. A small developer in Shanghai was simultaneously developing games, designing user interfaces for set-top-boxes, building hardware gadgets, and consulting to large organizations. This startup, incredibly, ended up having an exit years later with a Frankenstein business model. “This is the Chinese way,” they said.

However, when startups begin operations in more structured markets such as the United States, Japan or Western Europe, they realize that being jacks of all trades, master of none has a short life span. Entrepreneurs from emerging countries are learning, the hard way, that what was good for their countries is not enough to build a global company.

The problem is that competition in the digital realm is very asymmetric and favors a winner takes all approach. Google and Facebook, for instance, have 65 percent of the online advertising market in the United States. In the games market, with more than a million apps available on all platforms, the top five gaming companies are responsible for more than 40 percent of the industry’s revenue.

There are so many examples, from Uber to Tinder to Airbnb, where one player dominates an entire category. Thus, it is imperative for startups and large tech companies to focus on the core business model and become leaders in any given category.

In mature markets, entrepreneurs got used to focusing on being the best in a very tiny space. If startups are number one in a category or even a sub-category, they can expand their market inside out. Amazon, for instance, began selling books, then CD/DVDs and years later moved slowly to other categories. Snapchat rose to prominence focusing on disappearing messages for tweens.

In Silicon Valley, the concept of focus transforms into hyper focus. Here, startups may begin their life as mere product features. In 2012, for instance, Facebook acquired faces.com, which had an advanced facial recognition technology that was integrated into its site and mobile apps.

Instagram was initially a way for bad photographers to publish good pictures with their smartphones. Its main feature was filters, which was something Apple or Google could have easily copied. To the surprise of many, Instagram executed flawlessly and became the number one app in the space in a short period of time. After amassing millions of loyal users, it decided to focus on creating a real photo-centric social network.

As markets get more sophisticated, they also become more competitive, and that requires entrepreneurs to hyper focus. Hyper focus leads to simplicity and simplicity helps entrepreneurs to direct their scarce resources into great scalable products that people love. When people love something, they will come back. And the more often they come back, the faster entrepreneurs will find a repeatable business model that will propel their startup to world dominance.

When creating a global startup, this simple lesson from the Silicon Valley ecosystem can really make a difference in your chances of success. My advice is to unlearn doing many things simultaneously and focus on being the best at just one thing. Hyper focus is the capacity of saying no to great opportunities.