New York City - long a hub of financial, media and creative markets - has recently developed a unique tech and web startup scene. Companies like foursquare, Tumblr, GroupMe and Etsy have all blossomed in the Big Apple, attracting talent scouts from the likes of Google and Facebook to seek out ventures incorporating in New York.
While innovative, market-making startups like Etsy and Groupon tend to receive the best investment offers (Groupon reportedly spurned a $6 billion buyout offer from Google), they don't always end up the winner. Neither Google or Facebook was the first in its respective industry, and the same goes for Amazon.com, Target, Subway and Nike; they all just did it better.
Researchers Stanislav D. Dobrev and Aleksios Gotsopoulos of the University of Utah and Boston University, released a report this week confirming this trend, finding the most successful companies in new industries are often second, third or fourth to market - or even later.
"Contrary to the accepted idea of 'first-mover advantage,' the best time for a startup to enter a new industry is after other companies have already gotten there," writes J.J. McCorvey in Inc. magazine. "Because basic practices, such as lining up suppliers, have not yet been established, first movers perform poorly at these tasks."
Tags : incorporation news, ny, small business management
Posted: Apr 8th, 2011