This is the second post in the How To Become A Billionaire series. In the previous post, we discussed the most essential characteristic to reaching the 10 figure club. Each post is looking at what it takes to develop the billionaire mindset. Today, we are going to look at the importance of being a disruptor in order to get rich.
Trait Number Two: Billionaires Are Disruptors
What is a Disruptor?
A disruptor is an individual that turns an existing market upside down through a form of innovation, creativity, or ingenuity. Disruptors are new entrants that displace the leading companies in an existing market. This can be by creating a new product or service. It can also be done by just creating a better service. A disruptor can simply come up with a new way of doing things.
Harvard Business Review defines disruption as:
“a process whereby a smaller company with fewer resources is able to successfully challenge established incumbent businesses. Specifically, as incumbents focus on improving their products and services for their most demanding (and usually most profitable) customers, they exceed the needs of some segments and ignore the needs of others. Entrants that prove disruptive begin by successfully targeting those overlooked segments, gaining a foothold by delivering more-suitable functionality—frequently at a lower price. Incumbents, chasing higher profitability in more-demanding segments, tend not to respond vigorously. Entrants then move upmarket, delivering the performance that incumbents’ mainstream customers require, while preserving the advantages that drove their early success. When mainstream customers start adopting the entrants’ offerings in volume, disruption has occurred.”
New technologies are disruptive. New services are disruptive. New products are disruptive.
Google is a disruptor who destroyed Yahoo’s search dominance and transformed the whole search engine market. Netflix is a disruptor who destroyed Blockbuster and created a new way for consuming content. Wikipedia is a disruptor who destroyed Encyclopedia Britannica by offering free online encyclopedia information. Microsoft destroyed the word processing market killing off typewriters and word processors with its Office products like Microsoft Word.
Disruptors must be innovators and destroyers. Disruptors destroy what does exist and creates something completely new that never existed before. Disruptors simultaneously destroy and create.
Uber’s Disruptive Innovation
Travis Kalanick and Garrett Camp created a disruptor in 2010 by the name of UberCab. The two men set out with a mission to reduce the cost of passenger transportation. The two founders sought to provide a low cost transportation alternative to traditional forms of transportation like taxis and limos.
Today, Uber is the popular peer-to-peer ride sharing company that has completely disrupted the passenger transportation industry. The entire passenger transportation industry has been thrown into disarray based on Uber’s business model which allows ordinary individuals to become drivers anytime and anywhere. Passengers can book a ride quickly and efficiently using a mobile app or website. Payment can be taken using a credit card and the entire cost of the ride is known in advance.
Ride sharing is low cost, has fewer barriers to entry, and has fewer regulations (so far) than traditional taxis. The taxi cab industry with its medallion fees and higher costs has been struggling ever since Uber has entered the transportation market. Uber now has roughly 70% of the passenger transport market. Uber has become so popular that the company has entered the food service delivery and bicycle sharing business. In under 10 years, Uber has completely transformed the way that people think about and utilize transportation on a day to day basis.
Become a Disruptor
Becoming a disruptor involves thinking differently. You have to envision opportunities that others are unable to see. Disruptors understand the importance of thinking outside of the box. If you want to be a disruptor, start thinking outside of traditional mainline ways of thinking. Ask yourself the following questions:
- What new service can I offer that would completely redefine the way that people use an old service now?
- How do I improve a current service already being offered?
- What can I do more efficiently than others in a market?
- What new market can I create that does not already exist?
- What new product can I create that would make existing products obsolete?
- What is a better way to fulfill a task or need that current companies are failing to fill?
Find lower cost ways of offering services that already exist. Provide value to consumers by developing a way to reduce cost. There is always room for an efficient low cost provider in any market.
- Transform an existing market
- Anticipate future demand in a market
- Create an easier to use product or service.
Disruptors are risk takers who are unafraid of challenging the accepted norms and are willing to embrace radical change. Disruptors are change agents who bold enough to challenge conventional wisdom and tackle the dominant players in an industry. Disruptors are able to overcome the voices of the doubters, skeptics, and negative naysayers who are rooting for them to fail. Disruptors understand that it takes an optimistic mentality to achieve what others believe is impossible.
We now live in an age where anyone can be a disruptor.