hat are some of the factors that make it possible to create a trillion dollar company? What are the lessons from Apple?
Here’s a look:
#1 – Build An Ecosystem
Tien Tzuo, who is the co-founder and CEO of Zuora, recently took his company public. The shares have since gained 117%.
However, before launching Zuora, Tien was one of the early employees of Salesforce.com. “One day I got a call from Marc Benioff,” he said. “He asked if I wanted to meet Steve Jobs.”
But there was a problem: Tien was on vacation in Italy and it would be nearly impossible to make the meeting.
“So this turned out to be my only opportunity to meet Steve,” said Tien. “But Marc gave me a run down of the meeting and the main takeaway was that Salesforce.com needed to create a platform to build cloud apps. This would mean having strong barriers to entry because of the network effects. A platform would also allow Salesforce.com to quickly gain footholds in many market categories, without taking on large expenses.”
The result was that the company wasted little time in creating a platform, called the AppExchange. It would prove to be a critical factor for the success of Salesforce.com, which now has a market value of over $100 billion.
#2 – Obsess About The Customer
With a small amount of outside capital, Eric Yuan has turned his company, Zoom (which is a cloud-based conferencing system), into a powerhouse. Keep in mind that he has been able to fight large rivals like Cisco.
According to him: “Reaching a trillion-dollar valuation requires a customer-first focus and a long-term commitment to running your business independently—it took Apple 42 years to get there. Don’t get distracted by competitors who are willing to compromise on the customer experience for short-term gain.
You need to stay true to your personal vision to create a better product and the industry’s best customer experience–even if you have to make decisions that are less profitable in the short-term, such as by pivoting on a product road map or letting an unhappy customer out of their contract. In the end, a happy customer is the best investment you can make in your business because word of mouth will make or break any company in a competitive industry.”
#3 – Be Unconventional
Data analytics is a crowded market. But for Frank Bien, this is fine. His company, Looker, has been gaining traction in the industry because of its unique technology infrastructure that has been built from the ground up. There are currently over 1,400 customers, with big names like Cigna.
As for his take on Apple: “My advice to entrepreneurs that want to create the next trillion-dollar company is don’t think about a trillion-dollar valuation. Think about what you can do to create something useful, something that will turn customers into champions and that will inspire employees to do the impossible. For us at Looker, we figured out how to do the opposite of the conventional – even though people said it wouldn’t work. When you know you’ve got something special, ignore the haters, and the people who say what you want to do is impossible.
I remember how skeptical people were that Apple, a computer-maker, could make a successful phone. Apple knew better. And they didn’t stop there – they figured out how to keep delivering value to customers through new apps and services and devices so that the phone became less and less important. They created super advocates who are extremely loyal to the brand. That’s key. So do the opposite. Make stuff that works and that people love. Keep creating value. That’s pretty much the formula for success.”
#4 – Go Big
Nir Polak is the co-founder and CEO of Exabeam, which is a next generation SIEM (Security information and event management) company. He recently snagged a $50 million investment that was led by Lightspeed Venture Partners. Some of Exabeam’s customers include Levi Strauss & Co, ADP, Hulu and Safeway.
And regarding his view on Apple: “To build a trillion dollar company, first start with a really big market. In the case of Apple, perhaps the biggest of those was the smartphone market, which is measured in the hundreds of billions. Then you need to disrupt that market – build an amazing product that’s radically different and performs better.
Like an intuitive user interface that responds to gestures. And then, you need to delight customers to the point where they not only love your product, but tell everyone they meet how much they love it and spread the word for you. There’s no better marketing than happy users.”
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