It’s very hard to avoid the startup kill zone, as large corporations can take charge of the market and pressure small startups into mergers and acquisitions. Typically, by ensuring your business idea is unique, you can lessen the chances of this happening.
However, this advice also comes with contradiction. If your small startup is so niche, big corporations can replicate your business model with minimal overhead costs if they really are interested in what you offer. Startup companies are one of the biggest drivers in innovation and economic growth throughout the world. By limiting how many startups are bought out, we can limit the amount of control and market share bigger corporations have on the world.
What Is The Startup Kill Zone And Is It Real?
The startup kill zone is very real and can be easily described as when a new and innovative company is shaken or could be put out of business by big corporations. Over the past 11 years, we’ve seen more than 500,000 mergers and acquisitions, with companies such as Google, Amazon and Facebook leading the train. This limits the amount of competition in the marketplace and allows big corporations to easily have a bigger grip on market share every single year.
One of the most notorious startup killers is Google. Every year, Google buys out small startups to include/add their technology under the Google brand. Many companies do this for two reasons: to kill or to adapt. Killing a small startup reduces competition and innovation, which is terrible in the eyes of many. However, big corporations also buy small startups to merge their ideas and technology into their own brand, which Google, Facebook and Amazon are very popular at doing.
Why You Should Avoid the Startup Kill Zone
You should avoid the startup kill zone because it limits innovation and increases competition. In the business world, competition is healthy and grows our economy. Without competition, bigger companies can easily take control of the market. Small startups also give people the opportunity to flourish, increase growth for job opportunities and decrease plateauing.
How to Avoid the Startup Kill Zone
Big corporations, usually tech firms, are known to put small startups out of business or intimidate them. They typically offer a massive amount of money to acquire or merge startups to destroy competition and gain more control of the market. However, it is possible for small companies to avoid getting squashed. Here are four ways to avoid the startup kill zone to keep your business and dream alive.
1. Predict Trends, Not Chase Them
To drive innovation and shake up the market, it’s essential for your business’s product and service to stand out. You can create new products and services by predicting trends in your market and capitalizing on the opportunity that lies there. This will make you an expert in your niche and drive the market in a different direction, making your business stand out.
This tip also involves recognizing when you have a good idea and when you have a bad idea. As difficult as it may be to accept, only about two out of 10 business ideas are actually worth taking to the market. The other eight are either too soon, too late — or just not a good idea.
2. Focus on Execution, Not Perfection
Many small startups fail to get going because they worry too much about being perfect. Putting all your energy into being a perfect company hinders your productivity into actually getting things done to grow your business.
3. Be Careful About Fundraising
Raising funds for your startup is no easy task to complete. Not only is funding hard to obtain in general, but it allows outside parties to enter your business and tinker with it. When you’re securing funding for your small startup, deeply consider who you get investments from.
4. You Don’t Have To Take The Money
If you ever receive an offer from a big corporation such as Google, Facebook or Amazon, it’s very easy to take the money and have them run off with YOUR dream. Many entrepreneurs have a goal of being bought out by a big corporation, but if you want your dream to stay alive with the passion you have for it, then you don’t need to sell.