2nd is Often Better

There is a believe in the startup world that “first to market” is best. That there is a “first mover” advantage instead of an added challenge of pioneering a market or business model.

In my 30+ career, both personal experience and in watching how business works, it certainly looks to me like being a “fast follower” has higher odds of success. With the open question of “how fast” that following needs to be.

For example…

Apple was not the first to sell a PC, music player, or mobile phone. They were the first to produce great PCs, music players, and smartphones.

Microsoft wasn’t the first at anything. Not DOS. Not Windows. Not Word. Not XBOX. Not cloud. Not AI.

Google was not the first or second search engine. Facebook was not the first or second social media.

Ford was not the first automobile company. It was by far the largest for almost half a century, but passed up by General Motors, then Toyota and Volkswagen.

Mars didn’t invent chocolate. P&G didn’t invent soap.

Costco was a copycat of Pricemart, which was a copycat of Fedmart, which also inspired Walmart and K-mart.

Thinking through all the brands I intereact with, both products and services, it is hard to find one that is both successful and a first mover.

I want to say Berkshire Hathway, but it wouldn’t have existing without Graham-Newman Corp, which is why Buffett attended Columbia and where Buffett worked and which led to his investment partnerships. So no, not really a first mover, twice over by that path, and more so as the Berkshire Hathaway business model came about more from Charlie Munger and the SEC.

Falling down the rabbit hole of investors, American Research and Development was the true pioneerr, but their business model didn’t work. Rock and Davis was the first limited partnership, but that partnership survive even ten years. The “follower” VCs like Mayfield, Draper, and Kleiner are still around, 50-60 years later.

Which brings me to the image that triggered this post. Are you old enough to remember Sunshine’s Hydrox sandwhich cookies? Did you knew Oreo — the world’s most popular cookie — is a copycat?

The lesson seems to be that first to market isn’t the advantage it is perceived to be.