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“Out-Innovate – How Global Entrepreneurs from Delhi to Detroit Are Rewriting the Rules of Silicon Valley” by Alexandre Lazarow – a HBR Press Book Review

Start-ups are changing too – the new frontier lies far beyond Silicon Valley. So how can a small Asian low-cost start-up out-mqneuver the Silicon Valley micro-cosmos? How can a small fintech from Phillipines out-innovate the major incumbents, from Apple Pay to Revolut?

“Out-innovate: How Global Entrepreneurs–from Delhi to Detroit–Are Rewriting the Rules of Silicon Valley” looks at the critical success factors. Not only do the small start-ups go at superior speeds to market, but they also:

** Go faster on a global market scale,

** Create superior offerings for the bottom of the pyramid,

** Cost the investors much less and

** Stay lean and hungry.

The author Alexandre Lazarow is no stranger to these non-incumbent start-ups. As a venture capitalist himself, he has travelled around the globe and met start-ups on four continents. He tries to bring with “out-innovate” a new system of doing things within start-ups – one where you do not necessarily need:

– costly and complex support ecosystems,

– highly skilled specialists with prior industry experience or

– incubators well financed

to launch and create a new global product.

As the word goes around, Lazarow debunks the myth that start-ups are like problem.children: difficult to grow up and never knowing what will become of them. However, there are methods easily transferrable from a mature incubator to new companies alone. It starts with fostering, tending the full business stack. Most of the new ventures rely on a single new business idea, usually centered around a piece of software. Lazarow promotes the idea of a horizontal stack, something that I find really powerful.

What is a horizontal stack? “Out-innovate” puts it brilliantly: diversify and connect. Your original startup idea might not survive, but if you reiterate quickly enough your business stack into new offerings, you dramatically increase the odds of getting ahead. Building a horizontal stack means finding new proximity applications of your original idea. Or maybe changing the suppliers until you find the perfect mix for your final product. Or reinventing the product design until customers see clearly what you mean…

You get the idea. Lazarow is there to encourage you to use the big FANG tools for your new business model. After all, to out-grow your competition you must not only find your next blue ocean – you should also build the ship to navigate it. And in doing so, one should generate scale and margins – the constant startup obsession.

One more theme where “Out-innovate” touches a chord with menus building a comprehensive supply chain. We all know it – every great new product needs a channel to the customer. The distribution / delivery structure should be considered from the very beginning in the product’s design. As startups from Jakarta to Sao Paolo discovered, success relies on speed and simplicity. And on something that few startups think about – simply offering a nice delivery experience for your customers. 

My favorite chapter from “Out-innovate” looks at how startups “Reinvent the Finance” at the frontier. The contemporary banks are already re-inventing financial services with help from already well-established new ventures. Despite this wave of innovations, ranging from Paypal to Revolut, the new banking services continue to receive nudges from all corners of the world. With these new innovation nudges, everyone should benefit, from the consumers to the incumbents.

Title: “Out-Innovate – How Global Entrepreneurs from Delhi to Detroit Are Rewriting the Rules of Silicon Valley”

Author: Alexandre Lazarow

Publisher: Harvard Business Review Press

Year: 2020

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