Building Ecosystems, Not Just Products

When you analyze successful consumer and small business products, they succeed as a part of eco-systems and not just stand-alone products.

Consumers and small businesses don’t buy products, the engage in an ecosystem. Facebook is an ecosystem. It is a network of users, groups, businesses and advertisers. Email is an ecosystem, smartphones are an ecosystem, even computers are an ecosystem.

This is a very important question for people who are building technology products. What ecosystem do you belong to?

An ecosystem is a closed group of users or apps with a large number of connections. Once you identify your ecosystem, it is easy to find if your app has a demand. It is also easy to promote your app in an ecosystem, and crossing the chasm from early adopters to mature users is much easier.

Photo: Abhishek Singh

But this only works if you are not looking to be a dominant player in an ecosystem. For example, if you want to make a Facebook app and not a new Facebook.

If you are working on a product that will be the dominating part of an ecosystem, then you have to build your ecosystem. For example if you are planning to disrupt the ecosystem of a popular accounting application like Tally, you have to build a new ecosystem that has all the elements of the Tally ecosystem.

This is worth saying again, you have to build an ecosystem and not just a product.

It is easy to see why Tally is so popular. Accountants know it already. There are training institutes all over the country that teach Tally. There is a ready pool of people you can hire who already know Tally. It has a wide number of “partners” that can help you setup and configure Tally and there are a wide number of plugins available for Tally.

So if a new business has to select an accounting system in India, it is most likely Tally. For the United States, its probably Quickbooks and so on.

So how do you build your own ecosystem?

First, its important to identify the problem you are trying to solve. An ecosystem has at least an order-of-magnitude higher scope than just a product. Second, its extremely hard, time-consuming and resource intensive.

An ecosystem has so many parts that it is crazy to understand just the scope of it.

  1. The Product itself: With the features, user interface, technology stack etc.
  2. Ways to use the product: installers, cloud, virtual machines, docker, vagrant.
  3. Users: Potential users, trial users, paid users, free users, young users, old users, business owners, managers, system administrators.
  4. Contributors: Translators, enthusiasts, evangelists, helpers.
  5. Developers: Core team, bug reporters, third party developers, customization specialists etc.
  6. Service Providers: Consultants, developers, trainers, testers.
  7. Training resources: Videos, manuals, forum, articles.
  8. Developer Tools: Collaboration, continuous integration, platforms, libraries, documentation, videos etc.
  9. Promotion Tools: Website, blogs, case studies, social media accounts, advertising, PR.
  10. New user on-boarding: Domain specific features, defaults, setup.
  11. Localization: Translations, accounting, statutory rules, service regulation.
  12. Roadmap: Feature requests, technology shifts, strategy.
  13. Maintenance tools: Monitoring, releases, upgrades, deployment.
  14. Communication: Support, Email, Forum, Chat.
  15. Events: Demos, meet-ups, conferences, talks.

When you start thinking about all these factors, it is almost impossible to think and come up with a plan. You have chunk each factor one at a time and try and make some progress. This may seem hard, but there is no other way of doing it.

Core Values

I think to build an ecosystem, you must have a deep motivation on why your ecosystem is better than the existing one and why various stakeholders will switch from their ecosystem to yours.

Merely a better product will not do. Dvorak is a better keyboard layout than QWERTY, but the costs of unlearning QWERTY to Dvorak are very high, hence users and manufacturers are all locked in to the QWERTY ecosystem. The product and or ecosystem has to offer a lot more for users to switch and they must be complete.

Dvorak Keyboard Layout (photo: TypeMatrix)

Products are hard enough. If you are clear on your core values and stick to them, and have loads of patience, only then you should attempt to build ecosystems. Otherwise, its better to work within another ecosystem.

10 reasons why I spend a lot of time in the product ecosystem

As product entrepreneurs, every hour of our time is important. We run businesses that can succeed or fail depending on our choices. One of those choices is the time we spend on the eco-system.  Yet I have chosen to spend a lot of time on the ecosystem. Here is why.

1)      Learn from mistakes and successes: How much ever you say that you are doing something unique, you will be surprised to see that there is someone else doing something similar. They have made mistakes and they have had successes. Learning not to do their mistakes and learning to emulate their success is vital for your success. Learn every day.

2)      Networking  is exponential:  At first glance networking seems one to one. But if you are genuine, you would be surprised to find that networking can be exponential. Talk to someone, that person talks about you to someone else and soon its viral in a social sort of way. You never know how the stone that goes out comes back positively.

3)      Sharpen your knife for free: Get that UI feedback, or sharpen that go to market strategy. What you thought was the best based on your own thinking may turn out to be second best before you got that good opinion.

4)      Proactive helping gives joy: I find joy in sharing something to someone, which would save that person from huge mistakes or a lot of effort. Along the way if someone helps me back the same way, I will be happy, but not expect it.

5)      Winning awards is much more than being egoistical:  Your customers are looking for third party endorsements from reputed organizations. They may not ask you, but seeing one on your site gives them comfort. Win some for you and your company

6)      Collaborate to win the market: Many of us attack the same market. How often do you get an inquiry that you cannot use. Share it with someone who need it. You will get one back some day. If we organize ourselves well we can even create a market.

7)      Big brother isn’t so difficult with an ecosystem: Learn how to deal with the government. Taxes, banking, laws and much more can be handled much more easily by working with others in similar situations. It is not just learning how to handle a situation, but also acting jointly for getting something done.

8)      Mentor or be mentored: You will be surprised at the number of senior people willing to spend their time with you without expecting anything back. Years of experience, yet ready to help you with your problem. Remember to give back why you are ready to mentor too.

9)      Get Funded, find a partner, or even find a solution: The ecosystem is a magnet for all kinds of people  – investors, solution partners, suppliers and everything in between. Mingle around, be open and gain from it.

10)   Make friends along the way: The moment someone realizes that you are helping not for monetary gain, but because you just want to help, you make a friend. Business acquaintances are aplenty, but a friend is rare. I’d love to nurture them.

I’ve met many people who have inspired me along the way. Surprisingly most of the people who inspired me are not ones who speak from podiums, but people who open their hearts out with their passion. Cheers to the software product ecosystem – whatever shape or form it is!!

Guest Post Contributed by George Vettath, Kallos Solutions. Image Courtesy – NPC, Zinnov, Martecker