In the popular imagination, success stories in the tech world are due to two things: a unique vision and exemplary execution. And that often implies that there is a brilliant founder at the origin of it all.
But the reality is often very different.
In the early 90s, there was a book that fascinated me: “Accidental Empires” by Robert X. Cringely.
It is the pseudonym of Mark Stephens, an American journalist, columnist and author specializing in IT and the tech industry, who worked at Infoworld, among others, and the book is one of the first to tell the story of Silicon Valley in an unofficial way, focusing on egos, rivalries, mistakes, strokes of luck, etc. For those who, like me, loved the series “Halt and Catch Fire”, it was inspired by this book.
Suffice to say that at that time, when the internet for the general public did not yet exist, it was my first contact with Silicon Valley from an “insider” point of view.
In short, it was for me a founding work that I have always kept in the back of my mind.
I thought about it again recently when I read an interview with Sam Altman, the founder of OpenAI (An Interview with OpenAI CEO Sam Altman About Building a Consumer Tech Company) where he says, among other things, that OpenAI was not originally intended to be a company, that ChatGPT was launched somewhat by chance, that they had no business model and that they had to set everything up under the pressure of unexpected success.
This led me to delve back into my bookmarks and notes to find everything I had noted in the category “innovation and management mistakes” that ultimately led to unexpected success, and I tried to classify them into broad categories to try to find common denominators.
Then I don’t know whether it’s reassuring or worrying for budding entrepreneurs or investors….
In any case, we knew that leaders could make monumental errors of judgment (Why do leaders and experts make big mistakes when it comes to anticipating the future?) but now we also know that they can land on their feet.
In short :
- Many tech successes have been born out of mistakes, detours or secondary functionalities reoriented towards new uses.
- The pivot makes it possible to turn failure into opportunity, as Slack, Trello or Instagram have illustrated.
- Some products have emerged from unexpected uses, such as YouTube, WhatsApp or Twitter.
- Internal tools or personal solutions, such as Gmail, Shopify or Zoom, have become major products.
- Listening to usage, accepting failure and questioning the initial vision are the common threads of these sometimes improbable successes.
The pivot (or recycled failure)
The “pivot” is common in the world of start-ups, even when one would like the original idea to work. It means nothing more than changing direction abruptly because one has realized that one is going to get nowhere, most often by diverting the product from its original objective or by focusing on just one of its features.
Slack was initially a failed game
Stewart Butterfield is no stranger to the web world, as we have him to thank for Flickr (bought by Yahoo for 25 million dollars in 2005).
He and his team were working on a collaborative online game, Glitch, which turned out to be completely unsaleable. However, during development, the team had built an internal messaging tool to improve remote collaboration. When the game was abandoned, they realized that this simple and well-designed chat tool could be of interest to other businesses.
Slack was launched as a work tool intended to replace email, and was an immediate success. It was bought by Salesforce in 2020 (What about Salesforce’s acquisition of Slack?).
In the meantime, a feature developed behind the scenes may one day have more value than the initial product.
Trello: the prototype for internal use that everyone is fighting over
Originally, Trello was just a prototype developed by Fog Creek Software, a business specializing in project management tools and created on the ashes of the dot-com bubble (ironically the business is now called…Glitch). Its objective was to help visualize internal projects according to a Kanban logic.
The prototype was set up at a tech event, everyone wanted to use it and what was supposed to be just a feature for internal use was launched as an independent product.
Trello was bought by Atlassian in 2017 for $425 million.
Often when an internal tool meets the needs of your employees, chances are it will meet the needs of other people too. In a different genre, IBM Connection, an enterprise social network, was developed first for internal use and then marketed.
Instagram: users sort through the features of a convoluted system
Before Instagram, Kevin Systrom and Mike Krieger had launched Burbn, an application combining geolocated check-ins, messaging and photo sharing, a bit like an improved Foursquare. Too complicated, too dense, too rich, too confusing.
But by observing the data resulting from the use of the application by the users, they understood that they were using almost exclusively the photo function with filters.
They decided to scrap everything except this feature and rebranded the product Instagram, which became a runaway success and was bought by Facebook in 2012 for $1 billion.
Sometimes you have to put your ego aside and forget your vision when users clearly say what they want.
Misuse: letting users take the lead
Instagram is a prime example of users showing product management the way, but it wasn’t a case of misuse: they were using the photo feature to take photos.
But sometimes they totally misuse a product.
YouTube was supposed to be a dating site
Initially, the founders of YouTube had in mind a video dating site, but unsurprisingly, no one (at least at that time) felt comfortable posting video presentations.
To test the system, they uploaded a few ordinary videos that had nothing to do with the primary purpose of the product. As a result, people followed suit and began to use it as a sharing platform for the general public.
The initial idea and the business pivoted towards a video platform accessible to all. It was bought by Google in 2006 for 1.65 billion dollars.
WhatsApp: messaging by accident
Jan Koum initially just wanted to create an app to tell his contacts “I’m at the cinema” or “I’m at the gym”. Simply a status update tool.
Then Apple opened up push notifications: when someone changes their status, others receive an alert. Users then started to use the app to send messages to each other. WhatsApp pivoted and became the popular messaging service we know today.
It was bought by Facebook in 2014 for 22 billion dollars. Ironically, it was Apple that was behind the success of a platform that made its main competitor so successful in the mobile OS market.
Twitter: the public SMS born of a dead end
Twitter was born at Odeo, a podcast platform that went into decline when Apple announced the integration of podcasts into iTunes.
The team was taken by surprise and organized a brainstorming session to reinvent its future. Jack Dorsey proposed a platform for publishing public micro-messages of 140 characters.
The project was first launched internally and, during a hackathon, employees began to use it to such an extent that the tool went viral. Odeo abandoned its original product and put all its eggs in the Twitter basket.
Twitter, as you know, was bought by Elon Musk in 2022 for 44 billion dollars.
Just goes to show that you can innovate under stress in a moment of panic.
The internal tool that became a product
We have seen that a minor feature or an internal product could turn a business around. Sometimes, without calling the business strategy into question, they just enable a new product to be launched.
Gmail: the “20%” project that changed everything, a bit by chance
Paul Buchheit developed Gmail in 2001 as a side project. At the time, Google employees were allowed to spend 20% of their time on personal projects in order to promote innovation within the airline.
He wanted to prove that a web app could be fast, fluid, with an integrated search engine, and… 1 GB of storage, whereas at the time Yahoo! Mail only offered 4 MB.
The product took years to come out and, moreover, it was not even prioritized by the business, which did not perceive its value. But once the private beta was available, word of mouth took effect, everyone fought over the invitations and Gmail became a standard inboxes. The project really came out of nowhere and changed the history of email.
Shopify: selling snowboards… then giving up
Tobias Lütke and a few friends founded an online snowboard shop. As no e-commerce CMS suited him, he decided to code his own. Not only was it a success, but he also realized that other retailers were attracted to the technology.
No more snowboard sales, the business pivots and becomes a successful software company in the e-commerce field.
Rarely, Lütke is still at the head of the business.
Proof that creating for yourself sometimes allows you to do better than the tools on the market.
Zoom and the frustration of a visionary employee
Eric Yuan worked at Weber, which was one day bought by Cisco. Tired of the technical imitations of the tool, he wanted to rethink it to make it more fluid, more modern, more mobile. Seeing no point in such an effort for a tool that had almost a captive clientele, Cisco refused and he left to create Zoom with around forty other employees, making the user experience his hobbyhorse.
The result? Zoom has been a resounding success, helped, it is true, by the pandemic, which has been the best marketing campaign imaginable.
Mistakes that become opportunities
Sometimes we make mistakes, we miss something, we fail. It happens and too bad, we start again. But sometimes a failed product that should never have seen the light of day can become an opportunity.
Post-it: the glue that doesn’t stick
You all know this story and it doesn’t really concern the world of technology, but it’s too good not to be told.
At 3M, a chemist developed a “failed” glue: it stuck… but came off too easily.
Unusable for its intended purpose, the product was destined for the trash, but one of his colleagues had the idea of using it to make repositionable bookmarks.
The first tests were done on song books in his church to mark the pages without damaging them. The product was perfected and its use spread throughout the business and beyond.
Google AdWords: the unacceptable business model
As funny as it may seem today, initially the founders of Google rejected the idea of advertising, which they considered incompatible with their mission of “organizing the world’s information and making it universally accessible and useful.”
But an engineer pushed a prototype: ads linked to queries, without banners or animation. The results were impressive and the mission was ultimately relegated to the background in the face of the economic potential of a technology that would become the economic engine of the business.
Personal need transformed into an economic model
You get what you give. Great successes rarely come from a brilliant idea but from solving a problem, and when you find a solution to your own problems, maybe millions of people have the same ones…
Airbnb: how to turn resourcefulness into a business
Brian Chesky and Joe Gebbia didn’t have enough money to pay their rent. A conference was being held in San Francisco and the hotels were full. They bought three air mattresses, created a website in a hurry, and offered breakfast with the accommodation: AirBed & Breakfast.
The experiment worked. They repeated it and then turned it into a business model.
Another example is Uber, whose founders found themselves without a taxi in Paris while attending the LeWeb conference, which gave them the idea of creating a platform for booking cars with drivers.
Netflix: the myth of the late DVD
The official story is that Reed Hastings came up with the idea for Netflix after having to pay a $40 fine at Blockbuster. He then wondered if there wasn’t a better way to rent movies.
But for once it’s totally false and completely made up, but in terms of marketing, the storytelling is perfect.
The real innovation of Netflix? Using the logistical potential of DVDs, which are smaller and lighter than VHS, to offer postal rental and then unlimited subscription before pivoting to streaming.
It’s very clever, but the story is much less appealing.
Bottom line
From reading all of the above, one can conclude that either these entrepreneurs were very talented or they were extremely lucky.
But I always find it hard to believe in luck. Not when the cases are so numerous and the successes so great.
It makes you wonder if there isn’t a method behind what may seem like an accident. In fact, we find the same constants everywhere:
- The ability to listen to real practices (even when they contradict the initial intention).
- The culture of testing, experimentation and questioning.
- Tolerance of failure, even valuing it.
- The absence of a produced ego: knowing how to throw in the towel, start again and pivot.
I wouldn’t go so far as to say that everything was deliberate, but rather that setbacks are never such for those who know how to learn something from them and, above all, have no ego in relation to their initial vision.
Goldratt wrote a book called “Success is Not a Matter of Luck”. In the end, luck may be the visible side of the method.
