Starting a Tech Business: A Practical Guide for Anyone Creating or Designing Applications or Software

The Chasm and the Hockey Stick

Your early sales are the most thrilling, yet it's important they don't lull you into falsely presuming you're on a reliable sales trend. Many promising tech companies have ended up as a flash in the pan after a few early successes. In a traditional business, if you set up a better lemonade stand, so to speak, than the guy next door, you'll do well, increasing your sales on a linear basis.

Technology has quirks. Depending on your product's novelty, you're likely to see your customer development progress across something like the functions in Figure 8.5. Most importantly, these functions involve a crucial (and perilous) crossover from the early market to the mainstream market, with a related spike in sales.

Figure 8.5 The Chasm and the Hockey Stick

Sociologist and writer Everett Rogers (along with a few others) came up with the idea of a technology adoption lifecycle. Author Geoff Moore enhanced this theory's application to technology by identifying a chasm between early adopter and early majority segments. The basic idea is that you have two segments that will buy a useful product early on when it's still high risk: the innovators and the early adopters. The next segment, and the first big one, is the early majority and it's more averse to risk. This is where the chasm comes into play, transitioning from the early adopters to the early majority. You ...