Tuesday, November 1, 2011
There are many ways to fail as a startup, like selling something nobody wants, spending too much on unimportant features, or missing a market’s needs, but one of the most interesting ways to fail is by achieving success past your ability to handle it. The furniture maker who suddenly goes viral and takes thousands of orders that he can’t fulfill and ultimately drowns in cancelled orders and chargebacks. The chain restaurant that expands to dozens of locations in response to demand that turns out to only be temporary. The website that crumbles under the load of sudden popularity. In all cases, a smaller dose of success would have been much better for the firm.
These are all examples of companies experiencing what I call Catastrophic Success: the achievement businesses goals so far beyond your ability to respond that the success turns into a catastrophe.