SaaS 102 #14 Why Success Is More Likely When You Choose the Harder Path?
“When you’re faced with two courses of action, if one is simple and easy to learn and the other involves a tough path of learning and discovery, choose the tougher path without hesitation.” – Bob Xu, cofounder of ZhenFund and New Oriental Education and Technology
If everything in this world could be divided into four groups according to value and difficulty, they would look like this:
- Easy and low value
- Difficult and low value
- Easy and high value
- Difficult and high value
Everyone wants to reach success quickly, so many people want to do things which are easy and have high value.
But actually, it’s easier to succeed by doing the things which are difficult and have high value.
Why is it difficult to succeed when we do things that are easy but have high value?
Everyone wants to get high returns for simple actions. But many people don’t ask themselves the following question:
“If there is something to do which is easy and has high returns, why should it be me that does it and not someone else?”
Often when it appears that high returns are available for doing something easy, then one of the following two scenarios apply:
Scenario type one: Judgment error
In this kind of scenario, we have misjudged the situation. What we are looking at appears easy, but in fact isn’t easy at all. International package tracking is a good example of this.
It appears to be very easy to many people. Isn’t it just a matter of checking some data?
But actually international package tracking isn’t easy at all. It involves working with data from around a thousand carriers across hundreds of different countries. To make matters worse, each carrier uses different data formats and APIs.
Before they integrate with AfterShip, each carrier resembles a “data island.” And there are thousands of these data islands spread out across the world. If you want to track packages internationally the first thing you have to do is to link all these different data islands together.
This is actually a difficult, but hugely important, task. What we are doing is building a fundamental infrastructure for global eCommerce.
If this was something that was easy to do, everybody would be doing it, and AfterShip would face much more competition.
With all that extra competition, it would be hard for AfterShip to raise 66 million US dollars (an industry record) in a Series B funding, especially if we had only started preparing for the funding round a couple of months in advance. And yet, AfterShip managed to do just that in April 2021.
Scenario type two: Time-limited opportunity
The second type of situation is that this course of action really is easy and really does have high value. But this kind of opportunity only exists within a short window of time. The greater the value, the shorter the time window will be.
People are not stupid. As soon as people find out that what you are doing has high value, and is easy to do, they will certainly start doing the same thing immediately. Soon you will have many competitors, and at this point you will ask yourself:
“Can you really create a big enough competitive advantage to win and keep the leading market position in just a few weeks?”
And a lot of the time, you won’t be able to. That’s because the barrier to entry on the path you are on is too low, so everyone else can do what you are doing, too.
And because what you are doing is high value as well as easy, a lot of people will be willing to invest resources to get a slice of the pie.
An example of this is the community group buying trend which has become popular in China recently. Essentially, community group buying is a method by which large numbers of people within the same residential area (or community) group together to bulk purchase items, often groceries.
The barrier to entry for community group buying is not too high. It’s possible for any Chinese internet company with enough resources and online users to get involved. Not surprisingly, then, Chinese internet giants Tencent, Alibaba, DiDi, Meituan, and Pinduoduo all made entries into the community group buying market.
As the community group buying example above shows, when a market offers high returns coupled with relative simplicity, it quickly becomes saturated with competitors.
Even if you’re the first company to enter such a market, other companies will soon take note and join the market, too.
When that happens, then even if you got a head start of two weeks or a month, will you really be able to keep your place at the top and stay winning until the end?
In this kind of scenario, it might be easy to get started, but the challenges grow as time goes on.
A lot of the time you’ll be winning at the start of the race, but losing by the time you reach the finish line.
Personally, I don’t like to do things this way. I’m not looking for an easy start, but a successful finish.
When we consider a course of action we should think about value rather than difficulty
Once we’ve understood why it’s difficult to succeed by doing easy things that have high value, it becomes much simpler for us to form strategies.
That’s because we no longer need to ask ourselves: “Is this course of action easy?”
We just need to ask ourselves: “How much value does this course of action create?”
For example, we previously faced the choice of whether to focus our SaaS business on the international or domestic market. We chose the international market without hesitation.
Of course, we didn’t take that course of action because we thought it was the easy option.
If we focused on the domestic market, then we could avoid dealing with differences in time zone, language, market environment, and other difficulties. If we were looking for the easy option, we would definitely choose the domestic SaaS market.
But from a value perspective, there is currently more value in the international market. International customers are already used to using SaaS, and are willing to pay to do so.
Another example is building our team. If we were looking for the easiest option, then we would certainly choose to build our team in only one location.
But from a value perspective, working with talented people around the globe will enable us to provide more value to our customers. So we decided to make our team global, with people working with products, R&D, customer support/service, sales, and marketing from around the world.
This is why I often say to our team members, “when we consider a course of action we should think about value rather than difficulty.” Sometimes I will put it even more directly:
“Most things that have value are difficult.”
Summary
Everyone wants to succeed quickly, so most people will want to do things that are easy but have high value.
But there are two traps you can fall into by trying to take actions that are easy but have high value:
- Many things only appear to be easy, but turn out to be difficult once you start trying to do them.
- If something really is high value and easy, then many people will flock towards that opportunity. Even if you get in early and during the right window of time, you might find yourself winning at the start, but losing in the end.
So, when we decide what course of action to take, we shouldn’t ask, “is this course of action easy?”. We should ask, “ How much value can following this course of action create?”
If a course of action can give us the value we are looking for, we should do whatever we can to follow that path.
A lot of the time, following difficult, high-value paths is actually an easier way to reach success over the long term than looking for and following easy, high-value paths.
I'm Teddy, Co-Founder & CEO of AfterShip, SaaS 102 is a series of articles where I share my experience in SaaS startups.
We are looking for great SaaS sales talent and welcome you to join us at careers.aftership.com.
(Article translated by Joseph O'Neill)