Agile VC: 

My idle thoughts on tech startups

Brand vs product

Lee Hower
January 9, 2007 · 2  min.

In the course of listening to entrepreneur pitches, I’ve often heard a sentiment which never quite sits right with me… “We will build a leading [exceptional, great, etc] brand in order to deliver product/service X.” I’ve heard this notion expressed at least twice in the last month or so, which prompted me to opine here.

A well-recognized and respected brand can undoubtedly be one of the most powerful assets an organization can have. And it’s certainly important for entrepreneurs to think about how to cultivate a company’s nascent brand. But startup brands are by definition built upon the success and attributes of the products or services they provide. The statement above has the cart before the horse.

Think about the most successful and enduring startup brands of the last 20 years… chances are you thought of companies like Google, eBay, Cisco, or others. The power of the Google brand was derived from the success of Google’s consumer search engine, just as the eBay brand came from their success as an online marketplace for small traders and Cisco’s comes from their success making networking gear for enterprises. For startups, brands are less intentionally “built” then they are “derived” from successful products.

It’s true that large companies, with established brands, can sometimes take those brands and leverage them in different markets with new products. A great example of this is Apple who of course leveraged their brand in personal computers to “build” a successful digital music business. We’ll see how they do in the wireless handset business (I must confess, the iPhone looks incredibly cool) and keep in mind they’ve been unsuccessful at leveraging their brand in new markets too (think Newton – PDAs).

Bottom line, if you’re launching or in the early phase of growing your startup just focus religiously on “building” a product that’s incredibly compelling to your customer audience. I assure you… if you succeed in that, your brand will follow.

Lee Hower
Lee is a co-founder and Partner at NextView Ventures. He has spent his entire career as an entrepreneur and investor in early-stage software and internet startups.