While the world came screeching to a standstill and most businesses panicked, a few experienced almost the opposite. Deliberately or not, they tapped the nerve of human behaviour in these unsettled, unpredictable times. As a consequence, they’ve achieved unprecedented business success.
No, these are not companies that first come to mind – those providing PPEs, medical equipment, or meeting software. I’m talking about something as ordinary as paint. But first let’s describe a true entrepreneurial mindset.
The role of small data for startups
Most startups have one thing in common. Their founders bumped into a problem, a lightbulb went on, and that sudden inspiration formed the basis of their success.
Consider the two college kids who found themselves in a panic after they inadvertently posted a photo of themselves smoking weed. Oops! Wishing a function existed to delete the photo before it fell into the wrong hands, they invented Snap. Today, users send more than four billion photos via Snap, every single day.
Or how about the entrepreneur who was so annoyed at failing to hail a taxi to Orly Airport in Paris that he created Uber?
What these experiences have in common is something called “small data”, which I define as “seemingly insignificant observations made in our daily lives.” A study of 497 companies in the US, conducted by Lindstorm Company, shows that close to 84% of all startups were born from small data observations.
Every day, each one of us is exposed to myriad instances of small data. If seized and utilised, they have the potential to fundamentally change a company, an industry, or even the way we live. As COVID-19 ravages our world, opportunities to pick up on behavioural changes through small data have never been more abundant.
Those small data you spot might not only identify a completely new consumer need, but they might shape the foundation for products and services we’ve all been waiting for but had no idea we so desperately needed.
As an example, a few weeks ago I was searching for paint for my new house, when I serendipitously came across Tint, an Australian startup founded in the middle of the crisis and now revolutionising the world of paint.
Three university graduates identified a key issue: no colour is ever exactly the same on a screen as it appears in the real world. Setting out to solve the problem, they ended up with Tint. Press a small device against the colour you’ve fallen in love with, a sensor captures the colour’s code, and you send the code to Tint. They custom-mix your paint in their own factory and deliver it right to your door.
“We launched Tint in February,” CEO and co-founder Djordje Dikic told me from his locked-down home in Melbourne, “and I hate to say this, but had it not been for COVID-19, we wouldn’t have been as successful as we are now.” He is fully aware that such a statement, if taken out of context, may sound controversial—as if he’s happy to take advantage of the crisis—but the numbers don’t lie.
I was not the only person locked in my house and going into a frantic renovation mode. People all around the world, stuck inside their homes, spent untold hours staring at their tired old walls and wishing for a new colour scheme. Given the challenge of leaving home and visiting the local paint store, Tint came incredibly handy. It was the perfect device, launching at the optimal moment. It was a lifeline for many home renovators, as they could order the right colour online.
The company tapped into a philosophy I call “Clicks & Mortar” – the idea of a seamless combination of offline and online. What makes the concept beautiful is that it wasn’t born out of a lab, but instead from picking up on small data. The founders spotted an inherent need in the market and adapted a solution to it.
Observe small data points to identify new needs
At this moment, we’re witnessing a profound change in consumer patterns. In fact, we’ve witnessed the arrival of the first-ever “Eighth Entry Point.”
In our lives, we experience entry points, including the first time we go to school, when we get married, our first job and when we retire. Each of these entry points opens up our world to completely new needs — and thus the need for completely new products or services. When expecting one’s first new-born, you suddenly find you have a need for a baby stroller; when you get married, you suddenly discover a need for bed linens and kitchen appliances that you never before noticed.
Every day, each one of us is exposed to myriad instances of small data. If seized and utilised, they have the potential to fundamentally change a company, an industry, or even the way we live.
We’ve always had seven entry points, but now, as we confront COVID-19 and its aftermath, is the first time we’ve had an eighth entry point. And now, with the birth of a new, never-seen-before eighth entry point, is the perfect moment to spot small data and turn them into golden opportunities.
So, before descending into panic, it is important to ask ourselves: What gaps have appeared around us as a consequence of COVID-19? What profound behavioural changes do we notice?
Those small data you spot might not only identify a completely new consumer need, but they might shape the foundation for products and services we’ve all been waiting for but had no idea we so desperately needed. Before now.