{"id":388,"date":"2011-08-03T09:20:47","date_gmt":"2011-08-03T13:20:47","guid":{"rendered":"http:\/\/blog.payne.org\/?p=388"},"modified":"2011-08-03T09:20:47","modified_gmt":"2011-08-03T13:20:47","slug":"lottery-avoidance-have-a-real-asset","status":"publish","type":"post","link":"https:\/\/payne.org\/blog\/lottery-avoidance-have-a-real-asset\/","title":{"rendered":"Lottery Avoidance:  Have a Real Asset"},"content":{"rendered":"<p>If you&#8217;re one of the five people that read this blog, you know I&#8217;ve become negative on many pure-software\/Internet\/mobile entrepreneurial projects. \u00a0Low barriers to entry create a competitive, <a href=\"http:\/\/blog.payne.org\/2010\/06\/30\/coming-seed-crash\/\">weedy ecosystem<\/a> that becomes a <a href=\"http:\/\/blog.payne.org\/2011\/07\/29\/the-entrepreneurial-lottery\/\">lottery<\/a> for many entrepreneurs. \u00a0(Investors have a slightly different situation: \u00a0they can pick break-out winners from a field of options, where entrepreneurs have to start from zero).<\/p>\n<p>So, how do entrepreneurs avoid the lottery? \u00a0There are a number of ways (this is the first in an ad-hoc series of blog posts).<\/p>\n<p>One way is to have a real asset that&#8217;s core to the business, but is hard to copy. \u00a0Amazon&#8217;s product reviews are a great example: \u00a0competing with them means competing with the fact that many buyers go there first to check reviews. \u00a0Amazon built their own review database, but I think there are many data &amp; content assets that entrepreneurs could buy or license (exclusively) as the basis for a new business.<\/p>\n<p>Sometimes, IP can be the core asset, when there&#8217;s real technology with high-quality, issued, in-force patents, and relevant expertise in the team. Given the time it takes to get patents issued, this means the startup is licensing or acquiring patents to get started &#8212; pending applications usually aren&#8217;t worth that much.<\/p>\n<p>(Note that software\/code is rarely a core asset. \u00a0There are lots of smart developers, and software is usually pretty easy to copy.)<\/p>\n<p>The next lottery-avoidance topic: \u00a0deep domain expertise (to be continued).<\/p>\n","protected":false},"excerpt":{"rendered":"<p>If you&#8217;re one of the five people that read this blog, you know I&#8217;ve become negative on many pure-software\/Internet\/mobile entrepreneurial projects. \u00a0Low barriers to entry create a competitive, weedy ecosystem that becomes a lottery for many entrepreneurs. \u00a0(Investors have a &hellip; <a href=\"https:\/\/payne.org\/blog\/lottery-avoidance-have-a-real-asset\/\">Continue reading <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4,8],"tags":[],"class_list":["post-388","post","type-post","status-publish","format-standard","hentry","category-entrepreneurship","category-software"],"_links":{"self":[{"href":"https:\/\/payne.org\/blog\/wp-json\/wp\/v2\/posts\/388","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/payne.org\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/payne.org\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/payne.org\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/payne.org\/blog\/wp-json\/wp\/v2\/comments?post=388"}],"version-history":[{"count":0,"href":"https:\/\/payne.org\/blog\/wp-json\/wp\/v2\/posts\/388\/revisions"}],"wp:attachment":[{"href":"https:\/\/payne.org\/blog\/wp-json\/wp\/v2\/media?parent=388"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/payne.org\/blog\/wp-json\/wp\/v2\/categories?post=388"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/payne.org\/blog\/wp-json\/wp\/v2\/tags?post=388"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}