Ready. Fire. Aim?
The Distribution Devolution
Getting new products to buyers
is now an entrepreneur’s
required something that Neo.life doesn’t have:
paper. Then, starting a magazine involved dead-tree
technology: printing, which has been around since
the 15th century. There simply wasn’t a question
about how you would publish (though Wired.com
evolved quickly). Today, it’s far less evident how to
actually distribute a new publication, and it almost
certainly does not involve paper. There are a multitude of options. Do you start a website? Build
an app? Launch a newsletter? Use a platform like
Medium? The answer is not at all obvious.
In many industries, like apparel and food, the
means of production have become radically simpler
and more e;cient while the means of distribution
have become more complex and less straightforward. It’s one thing to create a product using
o;-the-shelf services, but it’s quite another to get
that product in front of the target audience. Digital
technologies have so thoroughly disrupted physical
distribution that it’s often a mystery just how to
connect to the flesh-and-blood humans who would
buy and use your product. It may have once been
di;cult to get your product onto a newsstand or
the shelf of a brick-and-mortar store, but at least
you knew where it was supposed to go, and how to
get it there. These days, not so much.
This has certainly been apparent at my startup,
Iodine. Building the product—a website of health
information for consumers—has been a relatively
obvious proposition. But since we launched, the
constant riddle has been how to get people to use it. Our tra;c has grown as we’ve plumbed the
numbers, but what’s driving any given month’s progress can be many layers deep. Like everyone
else, we look to Google Analytics as an oracle, but there’s only so much divination you can pull
out of a dashboard. And we try to spend our marketing dollars wisely on Facebook, attempting
to identify the right demographic profiles for the optimal click-through rate. But in talking to
digital marketing gurus, I’ve been surprised—and a little bit relieved—to learn that there is no
secret rule book for locating your audience. It’s all grunt work, a constant ground game of trying
to find every possible angle to get your product seen by its intended users.
This has created a third tier of services, after the means of production and distribution: the
means of optimization, the opportunity for (and obligation of ) any entrepreneur to be constantly
measuring and perfecting every variable in the company. If every startup is just a stack of services,
each of those services is a variable, made for constant tweaking and experimentation.
Which just proves that starting a company is easy. But building one is, in many ways,
harder than ever.
THE DIGITAL AGE HAS MADE so much about entrepre- neurship easier. There are services to take care of everything, including human resources (Zenefits), o;ce space (We Work), manufacturing (Alibaba), and fundraising (Indiegogo). If you have a whim and a wallet, it’s possible to assemble whatever you need in a company without actually doing any legwork. This transformation is well documented; virtual companies have exploded since Amazon
launched cloud services more than a decade ago.
But is it possible that things have gotten so easy that they have also,
paradoxically, gotten a lot harder? That seems to be the case. A friend
of mine, Jane Metcalfe, recently decided to start a new business:
Neo.life, a publication dedicated to chronicling new frontiers in life
sciences. If anyone can succeed in what is a very di;cult industry,
it’s Jane; in the 1990s, she created Wired with her partner Louis
Rossetto. One big di;erence between then and now is that Wired
Thomas Goetz is a co-founder
of Iodine, a digital health startup
based in San Francisco. Follo w
him on Twitter: @tgoetz.
LAUNCH 48 - INC. - JULY/AUGUS T 2017