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Though there has been a great deal of disruption in the past decade, several industries are still ripe for change today. I was a third-generation retail jeweler for over thirteen years when I saw an opportunity in our industry. It was a significant problem that needed to be solved, which wasn’t addressed by anyone else. It would mean I’d face a very old, large market with multiple entrenched key players. But, there was real potential for success. Shortly after, I left the retail jewelry business and launched my company, BriteCo.
The insurance industry is hugely complex and, surprisingly, hasn’t changed much since its inception in the 1700s. Jewelry insurance hadn’t seen much evolution either when BriteCo was founded. Developing, managing and selling an insurance product differs from most digital or SAAS startups. There aren’t the same clear ways to know your true costs and losses, which can make pricing difficult.
The insurance business requires a deep understanding of the industry, its fundamentals, extensive government regulations and other restrictions. You can’t quickly pivot or flip a switch if there are challenges or problems. The elements of scale are different, with little room for error. We knew this when we started, which was why many early market insurtechs struggled, seeking to acquire more customers without accurately assessing their risks.
Business founders in healthcare, finance, banking, telecom and other vast, longtime categories face similar environments. These industries have the same regulations, restrictions and business fundamentals as insurance. Many founders and startups have failed in these markets because they had the belief or idea that they could “break” the way things are traditionally done or work around these basics.
The reality is that that’s usually not the case. In some instances, maybe, but generally not. Entrepreneurs and organizations tackling age-old, complex industries often learn very quickly that the only way to succeed is to play by the rules in new and better ways. There are often real, legitimate reasons these industries are established the way they are. It may be to protect the consumer or prevent other issues. Disruption isn’t always demolition, destruction or detonation. It isn’t always breaking or bending the rules. More often, success lies in taking the basics and blazing a different path with them.
It can be extraordinarily intimidating, and difficulty is to be expected. Every business and market will have challenges and obstacles, but this can be drastically so in these industries. As with insurance, there won’t always be the same turnkey tactics and strategies or a traditional playbook or roadmap proven to work. You’ll often find yourself inventing the trajectories and approaches you must take. Even if you’re a seasoned or experienced business owner or leader, there will be a lot you’ll need to learn when entering a large, complex or legacy market. The propensity for mistakes tends to be a lot higher. But the rewards can also be higher, with a real opportunity to make an impact and drive incredible new change. It’s why many of us take the leap.
There have been many lessons that we’ve learned along the way that apply to any entrepreneur challenging a legacy market. Here are three of the most powerful learnings we encountered.
1. You can’t always escape an industry’s fundamentals
Large and complex markets typically have specific business fundamentals that can’t be overlooked or ignored. They are often set and in place for good reason. Many startups and organizations have tried to find ways around these perimeters to their peril. Even when it is possible to circumvent some, others simply won’t be moved. Knowing and mastering these market attributes can be far more efficient and effective, with equal success. Disrupt where possible, but know where to pick your battles.
2. You can’t do it alone
Taking on a large, established industry usually isn’t possible to do alone. It typically requires a far deeper knowledge base and expertise across greater ground that can be very hard for one person to possess alone. Before we launched, we had a team in place that was experienced in the many nuances of jewelry insurance, technology, marketing, and business. It has paid off. If your budget is limited, consultants, advisors and mentors can usually help until you have the resources to hire employees.
3. You can’t skip a business plan
The common belief that business plans aren’t necessary doesn’t usually work when trying to take a huge, complicated market. You don’t want to skip it, and it can’t be incomplete or light. Be immensely detailed, especially if you plan to raise capital anytime. We created a very in-depth attack plan covering the smallest of details before we hit the ground running. It has been key to our success, including raising capital before we had a product.
There are no absolutes, of course, but these three takeaways have been powerful as we built and grew our company. Entrepreneurs who want to climb a similar mountain, or those who already are, can apply the same to help increase their potential for success. It can be a delicate balancing act but one that offers unbeatable outcomes.