Developing Startups

May 27th, 2010 | By | Category: Featured Articles, High Tech, News

An article in the Jerusalem Post the other day caught my eye. It was a piece covering Israeli startups in the gaming industry, or more specifically the 3D gaming industry.  It is not every day that I notice coverage on Israeli startups, and not due to a lack of Israeli startups. It is well known that Israel has the largest number of high-tech startups in absolute terms after the United States. I have worked intensely with Israeli startups, and it never ceases to amaze me the ingenuity of some of these innovations. Of course, it makes me extremely proud to be able to live in Israel and assist these companies in “changing the world”. I would just love however, to see more focus and coverage on more of these smaller companies, which are doing incredible things.

Reading that piece by David Shamah got me thinking why some of these companies are never given a second glance. While most startups are trying to get off the ground, run by some brave entrepreneur who has thought up some great algorithm, or development, marketing and PR is often put on the back burner. Many consider the marketing stage to come after its development and therefore ignore its relevance at the planning stage.

A recently published study by the Reputation Institute of the world’s top reputable companies (see the full list published in Forbes) places Google at the top. It is no surprise that Google managed to outrank companies such as Sony, Apple, Microsoft and even Disney. Google has inspired trust and loyalty in millions of people around the globe. Like the other companies ranked in the top, Google is known to have very strong internal values. I thought it was interesting however that, in its recently filed 2009 10-K report to government regulators, Google stated, “Our user base has grown primarily by word of mouth. Our early marketing efforts focused on feeding this word-of-mouth momentum and used public relations efforts to accelerate it. Through these efforts and people’s increased usage of Google worldwide, we have been able to build our brand with relatively low marketing costs as a percentage of our revenues.”*

The potential of Israeli startup companies is widely recognized, and attracts the interests of numerous investors, including many of those listed above in the Global Reputation Pulse 2010. While I appreciate the fact that much of the technology developed in Israel is geared towards the “larger companies” that have bigger markets and more resources. I do not think that a “quick exist” should necessarily be a startup’s primary goal.

Concentrating on developing technology is essential. Without it, there would be no startups. However, as important at the initial stage as developing a business model, is creating a marketing and communications strategy to go with it. In today’s age of social media and ‘word-of-mouth’ technology tools, creating a buzz is well within reach. As Google reiterates, it has “no plans to move away from relying on word of mouth to drive interest in its products.”

* Point of interest: Only now, about 12 years later, has Google only recently embarked on mainstream advertising campaigns, having launched its first Super Bowl ad in February.

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