Bleeding Edge: Startups Outpacing The Current Limited Market

Bleeding Edge or in simpler terms too good for the current market is not a position many Startups dream to be in. We have all been told time and time again by Business Gurus and Entrepreneurs to always have a MOAT, and innovate a solution which hasn’t been worked on yet, leading to have an advantage and to gain market edge.

We’ve been told to stand out from the crowd of copy cats, and be unique with our Startup. That surely can be an advantage many a times, and many of the Top Entrepreneurs have always been innovators who have broken the barriers. But, we should also not forget that Startups can innovate faster than the market can understand or accept their geniuses, leading to failures.

We will focus more on those kind of scenarios, aka the bleeding edge, where there are perils of premature innovations. This topic kind of reminds us of the famous song of DJ Khaled- Suffering From Success.

What is Bleeding Edge?

Basic definition of Bleeding Edge is that a technology which can be so far ahead than a cutting-edge or leading-edge technology. It usually refers to a technology that is very new and probably very advanced, which is an untested product for the consumer.

Why does Bleeding Edge Fail?

Many a times consumers feel anxious or unsure about bleeding edge, because the product is still untested or has not been adopted by the masses, creating fear in them that this could be a risky investment. It can also be a scenario where a common consumer hasn’t got the resources or tools to experiment this unique technology. Either they don’t have enough spare money to splurge on this experiment, or they don’t have a device or means to fully test these technologies. It is not always the consumer’s fault though, as there can be many reasons which aren’t letting them experience these innovations.

Maybe the economy and purchasing power of the region is too low, or the government hasn’t introduced newer/faster internet means for them, or the taxes for such sector is too high, or there are just scientific and technological limitations in the current scenario. Such innovations could thrive in future, but the Startups who create them don’t have the resources to be afloat until the market is ready for them. This leads to the failure of their products, and many a times it helps a future company to use the same technology and thrive rapidly. We can say that some innovators are just too lucky to be born at the wrong time.

How to avoid Failing?

Many a times you just cannot avoid failing, because the rest of the market is not up to the mark with your innovation speed. Without a steady market readiness, it is difficult to make your product adaptable and in return profitable. You can still avoid failing by temporarily pivoting into something profitable short term, to keep yourself afloat. You can iterate based on market feedback, and listen to what their current needs are. This will eventually help your brand. You can also educate your target customer base, and inspire them to adapt to the new innovation.

Many smart entrepreneurs succeeded educating the masses and showing them a path towards their need. Steve Jobs is one of the great entrepreneur who brought a bleeding edge product – iPhone to the market in 2007, when they were not yet ready for a true smartphone. He focused his target market of tech enthusiasts and professionals who were ready to pay a premium, and experiment the unpolished version of iPhones, while his company kept iterating and improving the future models.

Another way to avoid failing is by not waiting for the market to ramp up their speed, but you yourself create the support eco-system for your bleeding edge product to survive and thrive. Tesla wasn’t the first Electric Car company, there were many small scale bleeding edge companies who tried and failed because the market wasn’t yet ready for an all electric car. The cars were small, their speed too slow, no charging stations, less mileage, etc. Electric cars were to be used more of a hobby, than a daily mean transportation product.

Tesla changed it all by working on almost all the pain points of the existing electric cars, and made their cars more stylish, more faster, more usable and more practical to own. They also didn’t just build cars, they starting installing their own charging stations everywhere, and not wait for others to do it for them. They changed the consumer perspective towards electric cars, which led them to become the world’s biggest car company by valuation.

When Sam Altman and team launched ChatGPT to consumers, they tied up with Microsoft for funding and for using their Azure infrastructure to scale and grow rapidly. They all had bleeding edge which could have pulled them down, but iteration, collaboration and education helped them to succeed and become market leaders.

Case Studies of Bleeding Edge Failures

• Google Glass introduced in 2013 was a bleeding edge, way ahead of their time. They could not succeed in convincing consumer adoption of their product. META is now trying to make their Ray-Ban Meta glasses mainstream in 2024-2025, and we’re yet to see major adoption.
• Vine introduced in 2012 was a bleeding edge, trying to bring 6-second-long looping video platform, when smartphones and cheap internet was still not widely available in the developing world. They shut it down in 2017. Tiktok released a similar mobile app in 2016, which currently boasts 2 Billion+ downloads, and was more popular than Google in 2021. Their video format is adopted by Instagram as Reels now.
• AskJeeves founded in 1996 failed to capitalize as a Search Engine because the technology wasn’t there yet. Google adopted many of AskJeeve’s tools like understanding natural language queries and ranking the webpages, becoming a global market leader they’re today. AskJeeves then became Ask.com in 2006 and shutdown their search function in 2010.
• PalmPilot was launched in 1996 as a technological marvel of touch screen with a pen, similar to what iPhones and iPads later adopted with better iteration. Palm devices which had their own Operating System (Palm OS) was just way too soon to the market, and eventually failed.
• WebTV tried to bring internet to TV’s back in 1995. They were just too soon to the market. Today streaming services like Netflix, Amazon Prime and others thrive due to technological advances.
• WebVan delivered groceries online within 30-minutes, way back in 1999. Investors pressure to grow fast and technological limitations lead to their closure in 2001. Amazon later picked up and became the behemoth it is today, and Indian companies like BlinkIt, Zepto, Swiggy InstaMart are expanding with fast groceries deliveries to doorsteps.

Bleeding Edge is most of the time an unlucky advancement, when the market is not ready to adapt or use your product. Peter Thiel famously advocates strongly to innovate from Zero to One, by building a technology or product which doesn’t yet exist, but we have to make sure to understand the market need, or have the patience and resources to educate the consumer into adopting your bleeding edge technology of the future to make it succeed. It is not impossible, and many great entrepreneurs have proved that they can turn the bleeding edge into cutting-edge, and create a successful startup even in the current times. If they could do it, then so can you!

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Bleeding Edge is a two edged sword, which can lead to your Startup’s failure if not being careful and smart enough. Having an out of the world edge isn’t just enough, if you cannot convince your consumer that they need it, and need it now. Hope this helps, fellow Desi Founder! You can find even more startup tips here.