3 ms·

Is the traction you're referring to here the type limited to web startups or (if anyone else knows) does this hold true for virtually any startup in any industr

by kyro 13y ago

Is the traction you're referring to here the type limited to web startups or (if anyone else knows) does this hold true for virtually any startup in any industry? I imagine there are a handful of industries where achieving 'traction' may take several years, eg biomed.

spartango 13y ago
On one hand I'm inclined to come out and say, "No, in some industries you simply cannot get traction before going to investors (repeatedly)", given my experience in the biotech industry. Most biotech companies don't get "traction" until even after IPO, because the capital needs associated with making scientific and medical progress are large. Yet, the reality is that even in these companies there's a notion of traction, and it's absolutely critical. It's not measured in terms of users, but instead manifest in scientific milestones. Every time you demonstrate the scientific validity of a piece of your tech, you are de-risked in the eyes of investors. That mirrors traction, even if it's less direct. Another way that biotech companies can achieve notions of traction comparable to tech companies is through intermediate business models, such as operating as a contract research organization or reference laboratory. Despite those parallels, I'd say that biotech traction is still difficult to achieve because most science lacks determinism in the rate of progress.
cynusx 13y ago
Traction is the most important for web startups because technology is not the limiting factor. There are a lot of teams out there that can build whatever. The problem is mostly reduced to market-risk. Traction is a big signal that market risks are mitigated even when that may not entirely be true. Biomed startups have mostly technology risks, the problems are well-known and there is a very defined (and heavily regulated) goto market process. As the comment above mentions, the thing that gets investors excited in biomed startups is mitigation of the technology risk.

by kyro 13y ago

spartango 13y ago

On one hand I'm inclined to come out and say, "No, in some industries you simply cannot get traction before going to investors (repeatedly)", given my experience in the biotech industry. Most biotech companies don't get "traction" until even after IPO, because the capital needs associated with making scientific and medical progress are large. Yet, the reality is that even in these companies there's a notion of traction, and it's absolutely critical. It's not measured in terms of users, but instead manifest in scientific milestones. Every time you demonstrate the scientific validity of a piece of your tech, you are de-risked in the eyes of investors. That mirrors traction, even if it's less direct. Another way that biotech companies can achieve notions of traction comparable to tech companies is through intermediate business models, such as operating as a contract research organization or reference laboratory. Despite those parallels, I'd say that biotech traction is still difficult to achieve because most science lacks determinism in the rate of progress.

cynusx 13y ago

Traction is the most important for web startups because technology is not the limiting factor. There are a lot of teams out there that can build whatever. The problem is mostly reduced to market-risk. Traction is a big signal that market risks are mitigated even when that may not entirely be true. Biomed startups have mostly technology risks, the problems are well-known and there is a very defined (and heavily regulated) goto market process. As the comment above mentions, the thing that gets investors excited in biomed startups is mitigation of the technology risk.