A REAL-LIFE EXAMPLE OF TAKING ADVANTAGE OF YOUR SIZE
(taken from Seth Godin's ebook The Bootstrapper's Bible)
(Or, how id software completely redefined the computer game market and made millions.)
The software company that calls itself id is a classic bootstrapper. It makes violent computer games that run on home computers. Its software is usually developed by a group of 2 to 10 people, then published by a big company like Electronic Arts. It costs a huge amount to make a new product (sometimes more than a million dollars) but amazingly little to make one more copy (as low as 50 cents).
So the idea in computer game software has always been to spend whatever it takes to make a great game, then spend whatever it takes to get shelf space in the software stores, then hope and pray that you sell a lot of copies. One hit like Myst can pay all of a companyʼs bills for years to come.
Id became famous for a game called Castle Wolfenstein. As an encore, the four guys who founded id decided to follow their own rules in playing against the big companies. They did it with a game called Doom. They brazenly broke the first rule of software marketing—they gave Doom away to anyone who wanted to download it. Free. Millions of people did. It quickly became the most popular computer game of the year. It didnʼt cost id very much to allow someone to download the game, but the company wasnʼt receiving any income at all.
In stage two, id offered a deluxe version of Doom with more levels, more monsters, more everything. Partnering with a big guy (GT Interactive), it got the software into stores around the country. And sold it directly by mail order. With a user base of millions of people, id got to call the shots. Instead of being at the mercy of the gatekeepers of distribution, it was courted by distributors and retailers. By inventing a completely different business model, a model in which it had nothing to lose, id redefined a business and won.
Take a look at all the attributes listed in this chapter. Id took advantage of the seven that help the bootstrapper and steadfastly avoided the five that help the big company. By redefining the game and playing on its home field, it trounced companies valued at more than half a billion dollars.
Hereʼs how id used the seven bootstrapper tools:
1 NOTHING TO LOSE. The method used by id threatened to destroy software distribution as we know it. Which was fine with id, but not so fine with the guys at the big software companies. Thereʼs no way in the world they would have had the guts to do this themselves.
2 HAPPY WITH SMALL FISH. Because id didnʼt spend any money on advertising, and because it had developed the game itself, it didnʼt need Doom to be the best-selling computer game of the year to be happy. Even 30,000 sales would have been enough to make the venture successful.
3 PRESIDENTIAL INPUT. Id had total consistency. The game was designed, marketed, licensed, and managed by the same four people. No miscommunication here.
4 RAPID R&D. There were no budget committees, no marketing schedules, no organizational charts to get in the way. (Itʼs interesting to note that it took three times as long for id to create Doomʼs sequel. The gameʼs makers had apparently forgotten what they had learned about rapid R&D.)
5 THE UNDERDOG. Consumers love to root for the hippies at id. It makes them more likely to spread the word and to buy (not copy) the final game.
6 LOW OVERHEAD. Thereʼs no question that high overhead costs would have wiped these guys out.
7 TIME. They knew they could ship when they needed to, instead of when shareholders demanded a new influx of sales. Because they controlled time, they could use it to their advantage.
Send us YOUR bootstrapping examples at people.hungry [at] gmail.com. Let's hear it!
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