How to innovate, find a niche and survive economic downturn

Rough seas make stronger sailors.

A few days ago I was invited by Black Ark, a subsidiary of Chinese tech consortium CEC to give a talk at an innovation summit in the heart of HuaQiangBei in Shenzhen, as part of a hi-tech fair.

Sun Wei — Black Ark GM

It’s always a pleasure to share ideas and thoughts with a crowd of professional hi-tech makers because people creating physical products that combine both hardware and software must master so many skills from design to engineering along with supply chain and logistics. Therefore, most of them have a very good understanding of the World we live in and master multiple facets of different industrial processes.

I’d say it’s even more insightful during major pivotal economic and social events like the one we are living these days.

How to survive economic downturn in the midst of a bear market along with a new cold war which is not saying its name.

That’s a big topic 😊

But let’s learn from our own experience and what we have seen through the rear-view mirror of history. Bear markets always follow major historical events.

The 3 biggest bull markets over the last 30 years:

  1. Pre-Dot Com Bubble Burst (1990–2000)
  2. Pre-Global Financial Crisis (2002–2008)
  3. Pre-Covid Crisis (2010–2020)

Too big to fail

Economic downturn usually favors big corporations because they have enough cash runway to go through severe financial crisis. It’s way more complicated for startups.

That’s the reason why I recommend anyone working in a tech startups to be very cautious in terms of technological bet for the next 18 months. I’ve formalized it with that Tech Sex Appeal matrix. Everyone wants to work on something New and Hot but that’s not how survival works ;)

Apple and Google disrupted the mobile phone industry in the midst of the Global Financial Crisis

The iPhone went on sale 15 years ago today and sold 2.2 billions units to date making it the most successful tech product of all time.

“Today, we’re introducing three revolutionary products. The first one is a widescreen iPod with touch controls. The second is a revolutionary mobile phone. And the third is a breakthrough internet communications device.”

The very first iPhone in history made its world debut on June 29th, that was exactly 15 years ago. A few months earlier Steve Jobs introduced it pretending 3 products, an iPod, a Phone and an Internet device up to unveiling the iPhone along with the best tagline ever: “Your life in your pocket”.

Obviously the iPhone totally disrupted the entire mobile phone design industry and beyond. One thing the product team missed during the keynote was the future importance of the camera feature, creating a complete side industry through social networks. Steve Jobs actually introduced four revolutionnary products in one that day.

The iPhone is also key breakthrough in my personal career. When I look at the last 15 years, late 2007 is also the time I moved from France to Shenzhen as an “industrial migrant”. My industy was moving there and I had to be part of the trip.

That’s actually hard to summarize 15 years in 1 slide from my arrival in Shenzhen by ferry from from HK airport to Shekou, to some phone designs, Omate, getting married 😊 meeting cool people, launching Oclean, becoming a father 😊 la FrenchTech 🚀

At that time, the company I was working for (Cellon / Avantech) was still designing 2G feature phones in France mainly for Philips China and later on Fly Russia. The kings of that era were Nokia, Sony-Ericsson and Motorola, and the challengers were mainly South Koreans alike LG and Samsung.

It was the early days of the 3G and Chinese makers were still very exotic with TD-SCDMA protocol, Oppo was an unknown MP3 player company, Huawei was focusing on networks, no consumer in the West knew these brands yet. ZTE was the only one doing serious white-labeled handset business with Western telcos at that time.

Actually something even more disruptive happened on September 2008 when Google announced its first Android phone, the HTC Dream, a.k.a the T-Mobile G1 along with the Android Open Source Project (AOSP) that would lead to a new breed of brands we are familiar today such as Xiaomi, Oppo, Vivo, One+ and even the new kids on the block, Nothing and the Solana Saga smartphone.

HTC Dream also known as T-Mobile G1. The mother of all the Android smartphones

So if we look at it, the Apple and Google events was in the midst of the global financial crisis (GFC), a period of extreme stress in global financial markets and banking systems between mid 2007 and early 2009 and we could easily consider it was the worst time to launch a new disruptive product category but on the long term, all of that did not matter. It worked pretty well for both Apple and Google and even plenty of new companies.

But that same period destroyed many innovative companies that could not go through the GFC and its aftermath.

Takasu Masakazu (Switch Science / Nico Tech Shenzhen) & me on June 17, 2022

That’s probably the reason why we may see amazing new technologies coming soon in the midst of this quagmire that will be part of our daily life 15 years from now by 2037 😊

In the meantime, the only requirement we must assign to ourselves and to our companies is to survive. Therefore, stay safe my friends and keep innovating!

me and Dr Ludovic Krundel

Laurent Le Pen

@llepen

--

--

Founder & CEO at Omate @OmateOfficial #IoT #Telecom #Wearable. Co-Founder at Oclean @OcleanOfficial #Healthcare.

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
Laurent Le Pen

Founder & CEO at Omate @OmateOfficial #IoT #Telecom #Wearable. Co-Founder at Oclean @OcleanOfficial #Healthcare.