Building A Business Around Someone Else’s Could Mean Disaster
By on March 11th, 2011

I have had some really big ideas to build around WordPress. I had wireframes ready for them, had all business plans ready and more. However, when I went to an investor to get funding for it, I came back empty handed. The reason was because though my ideas were not innovative, but no one willing to put much money into it because of the fact that it relied on someone else’s business.

Business

This rejection thought me a big lesson in life and there were several things I learnt from the Investors who rejected my idea. One of the most important lessons I learnt was to never build a business based on someone else’s business. There are quite a few problems. I’ll quote some reasons below:

  • You rely on someone else’s business for your own business. This is the cardinal sin of creating a business in the first place.
  • When the business in question builds something you have built, your business is potentially killed rendering all your hard work and marketing useless.
  • There will be competitors who will try to do better (remember first is not always best in startups) and take off and your business may collapse.
  • The business you are building around could just collapse rendering all your hard work useless.
  • The business you built around could change their terms of use rendering all your hard work useless.

Well, these are just some of the lessons I learnt from a brilliant idea which collapsed like a pack of cards. The idea would work, it would have worked great in the short term, but in the end it would collapse because of the fact that I don’t really have control over how things would work out considering all the above problems I listed out.

Also Read: Is Twitter a Reliable Service to Build Your Business Around?

Of course there are success stories which are built upon these businesses, for example on we all came across Farmville at some point of time. The game was created by Zynga, a company which relied solely on Facebook for it’s income before diversifying and becoming a billion dollar company today. There are more examples like these which will lure you into building around someone else, but there are also 100 times more failures.

Quite recently,  asked developers to stop developing new apps to display Tweets because they wanted to control how tweets are displayed and how information is delivered to their users. This new change has caused quite a lot of hue and cry among the developer community, and for valid reasons.

However, the storm will die and developers will stop developing apps for Twitter, but what about people who already put in years of efforts into developing those great clients? Does everything go to waste? Would the folks behind have to shut shop? Well, most likely the popular clients will survive, but the smaller clients would eventually wind up. In the end, Twitter can block your service like they did recently with UberTwitter and twidroyd and render your app/business useless.

Of course, this does not mean that you should not use Twitter or Facebook as part of your business. However, it is better to limit the amount of functionality they bring to your business. Building your business solely around Twitter or Facebook or for that matter any other service would be disastrous in the long run and is definitely best avoided.

I am not a businessman per se, but I have seen enough in the past 10-12 years to really understand that it is always better to build something and then integrate other services as part of it, rather than building a service around something.

I would be more than interested in knowing your thoughts about this and would love to learn your experiences on developing apps and your feelings about Twitter’s recent move. The comments form are all yours.

Image Credit: Contractor Business Profits

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Author: Keith Dsouza Google Profile for Keith Dsouza
I am the editor-in-chief and owner of Techie Buzz. I love coding and have contributed to several open source projects in the past. You can know more about me and my projects by visiting my Personal Website. I am also a social networking enthusiast and can be found active on twitter, you can follow Keith on twitter @keithdsouza. You can click on my name to visit my Google+ profile.

Keith Dsouza has written and can be contacted at keith@techie-buzz.com.
 
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