A wise businessperson once observed that startups die of indigestion not starvation. It’s a comment not about young entrepreneurs’ penchant for late-night pizza, but about the inability of young companies to maintain a strict focus on a central goal.
Last month, we explored the three key drivers or success factors for companies working to build a market for new technologies. The first of these drivers is focus and market positioning. For any company trying to create a market for a new product or service, the first step must be to devise a plan of attack that focuses on a single, well-defined segment of the overall market. This month, we’re going to delve deeper into the need for focus by concentrating on an emerging market that is attracting a lot of startups and venture funding: wireless communication.

The Wireless Opportunity
The enormous success of cell phones over the past decade is the powerful motivating force driving today’s mobile market. The prospect of linking individuals to the Internet, their computers, voicemail and e- mail — from anywhere, any time and through any device — is drawing entrepreneurs from a wide range of industries. In fact, the San Francisco-based research firm ventureOne Corp. recently reported that venture capital investment in wireless companies hit $1.95 billion in 2000, a 100 percent increase over a two-year period.

Traditional telecom service providers, application providers, software developers, device manufacturers and content providers are all scrambling to stake out territory in this emerging market. The entire industry is anticipating the emergence of third-generation, or 3G, wireless networks in the coming months.

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