Home 10 Micro Trends to Bet on For Your Audacious Startup

10 Micro Trends to Bet on For Your Audacious Startup

Credit crisis. Blah, blah. Cut costs. Blah, blah. Don’t you just love it when you get an alarm call from your hotel at 9.15 when your meeting is at 9.00? At ReadWriteWeb we have been sounding alarms about the economy for a year (here, here, here and here…enough already), suggesting strategies to cope with the coming downturn.

But what about now? This is the time to be audacious. The world has changed, totally and irrevocably. Change is the entrepreneur’s friend.

Forget About Tsunamis, It’s The Little Waves That Matter

I call these Micro Trends. They are not the big obvious trends that everybody is riding – such as mobile, online advertising, search, social networking, globalization etc. If you spotted those 10 years ago, great. Now it is too late. Think surfing. If you see the wave building early on, you get a chance to ride it. If you catch it too late, you get crushed.

How Does The Last Few Weeks Change This List?

For some time I have had a list of Micro Trends on my personal blog. It seems a good time to revisit them to see what might change based on the global credit crisis.

1. Transparency. This wave has been building for a while, but it just got a big boost by recent events. Transparency in financial markets obviously. Then there is Obama’s Google for Government initiative. Some of the smartest recent startups we have seen use a mix of technology, insight and hard work to expose the inner working of industries to eliminate information asymmetry and get lower prices for buyers. You can bet that there will be more.

2. Relocalization. We have already written about this here. Tough times will accentuate this trend. The solutions are not obvious (so Momentum VC won’t touch them), they could be game changing.

3. Reduced power of gatekeepers. This relates to Transparency. Reduced information asymmetry reduces the power of gatekepeepers/intermediaries/tollbooths. The Financial Services industry is the mother of all gatekeepers. The Economist states that in the early 1980s, the financial services industry accounted for 10% of GDP, but last year it rose to 40%. One change arising from the recent turmoil we can be totally confident about is that the current financial services intermediaries are weakened and new models will arise. Who will do a craigslist on the financial services industry (or at least segments of that vast industry)?

4. Micro-trend Slopes replace Chasms. Alex Iskold started an interesting conversation about whether the Internet has made the Chasm adoption model less relevant. Biking up and down slopes may be the better analogy today. Catch a new trend and you can cruise down a slope, picking up speed effortlessly. As trend-spotting me-too ventures join the race (the Internet spreads ideas instantaneously) the slope flattens out and curves uphill. In good times, a bit of pushing gets you over the top and catching another micro trend slope on the way down. If your up slope coincides with a cyclical down turn (and we are certainly in a big cyclical downturn today), you will get a flat tire and have to carry your bike up the hill and mend it at the top. Don’t worry, the other racers will have given up at that point. Starting in a cyclical downturn, make sure you are on a down slope!

5. Changing balance of power between big and small businesses. Yes we have been “banging on” about this for a long time. For the most long-winded description (sorry), read this. This could be the biggest micro trend, even a Tsunami that few people have spotted. Which the current crisis just accentuated. Which the incoming President might actually do something positive about for a change.

6. Self-organizing networks beat command and control structures. This is the story of Enterprise 2.0 – aka, social media meets the enterprise.

7. The end of mass markets. This relates to most of the other trends. Small, niche, specialist will beat mass produced. This is why Etsy may be a big winner from this Web 2.0 cycle. There are probably other opportunities around this trend.

8. Ad $$$ will flow to measurable ROI models. OK, that falls into the no-duh category! But surely Google Adwords is not the only winner in this category? There must be a better ad targeting model out there somewhere? Not better search, you can just use Yahoo Boss for search – that game was totally over well before the credit crisis. But better ad targeting that does not infringe privacy is a big winner.

9. Bubbles will form and pop faster. Bubbles are like booze. With a horrible hangover we say “never again”. But guess what…. They don’t reappear in the same place until a generation that was bruised has moved on. So the big bubble may be a thing of the past. But we will get lots of small ones. That is kind of like moderate drinking, actually quite good for us. My motto is “moderation in all things, including moderation”.

10. The end of 11 point lists. I used to do 10 point lists until a commenter showed me this wonderful Spinal Tap video. Seriously, 10 point lists indicated limits and space on the Internet is unlimited. But then I noticed many people doing 11 point lists. In the spirit of back to basics discipline, 10 point lists will make a comeback.

Image credit: Thomas Hawk

See also: What’s Next After Web 2.0

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