Are you a disrupter or an optimizer?

edmit

Edmit’s current employees are Sabrina Manville, Nick Ducoff, and Christopher Jelly. JONATHAN WIGGS/GLOBE STAFF

In addition to Silicon Valley’s trope that the only way to learn is from failure is the idea that the only way to create a successful startup is to be a disrupter – to get really big you must disrupt some old slow business, the way Amazon has disrupted retail. But exactly what industry did SnapChat disrupt? Or even Google in its early days before it started its quite long path to disrupting the advertising industry? And again, looking at Facebook, what old slow industry did it disrupt? Like Google I’d suggest that it didn’t start out disrupting any industry or market – it created a new opportunity, a new way for people to connect. It wasn’t until the rise of mobile – which Facebook was initially slow to recognize but caught up an lightning speed – and mobile advertising that Facebook, like Google, began to disrupt the advertising industry.

There’s another path to creating a successful business which I call “optimizers” – those companies that spot an inefficient marketplace and make money by taking advantage of those inefficiencies, but leaving the existing marketplace intact.

Scott Kirsner‘s article in The Boston Globe, They’re out to reveal the ‘dirty little secret of higher education‘ is about a startup that doesn’t see itself as a disrupter. Edmit’s goal is to provide students and parents with far great transparency into college tuition and financial aid than has been available ever before.

And, Edmit cofounder Sabrina Manville says, while a lot of attention has been paid to rising tuition prices, the net price that the average student pays has been “very flat. But students and parents have sticker shock. They’re not realizing that schools are more affordable than they look, and schools are turning people away that would otherwise be able to come to them.” Manville was, until recently, an executive at Southern New Hampshire University in Manchester.

So clearly Edmit isn’t out to disrupt the college market, but to provide a comparison-shopping experience similar to what sites like TrueCar or Zillow offer for vehicles and homes.

Edmit is frank about optimizing the higher education market:

Higher ed is, after all, a business, and a key part of that business is enrolling the right number of students to generate the right amount of revenue. “It’s like Goldilocks,” Ducoff says. “It has to be just right. You don’t want to many students or too few. If you get too many, you’ve got to scramble to provide housing, and bring on extra faculty.”

Edmit is creating a much more efficient marketplace for college enrollments, not about creating a new marketplace, like Craigslist did, which in the process totally disrupted the classified market of newspapers.

And Scott Kirsner sees this clearly:

Unlike most tech startups, though, Ducoff and Manville don’t see themselves as “disruptors.” But they do want to change how tuition prices are communicated and understood.

“We’ve banned the word ‘disrupt,’ ” Manville says. “But we are here to make [the financing process] more efficient, which should benefit both colleges and students.”

So I’m not suggesting that as a founder you ban the word disrupt or even ban the ban the idea of disruption. Quite the contrary, there are old, staid industries out there to be disrupted and if you have a breakthrough idea that can disrupt them, by all means go ahead. But there are also plenty of opportunities to make existing processes far more efficient and provide benefits to both sides of that marketplace, and create an successful business for  yourself.

 

Author: Mentorphile

Mentor, coach, and advisor to entrepreneurs, small businesses, and non-profit organizations. General manager with significant experience in both for-profit and non-profit organizations. Focus on media and information. On founding team of four venture-backed companies. Currently Chairman of Popsleuth, Inc., maker of the Endorfyn app for keeping fans updated on new stuff from their favorite artists.

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