A classic case of a new business using another to build a bigger one
Anew business model has appeared in the past decade, creating opportunities for thousands of new businesses. Unlike traditional business creation in which a company starts to provide a product or service that competes with others in its space, this new business springs from another business and forms a symbiotic relationship.
More specifically, the new business serves customers on another business platform. The best known example is the app developer for the iPhone, and now Android, operating systems. Facebook, with vast legions of users, is a communications platform so big it has been responsible for the launching of hundreds, if not thousands, of businesses.
Then there is Vancouver’s BroadbandTV, a service tha lululemon outlet t manages and claims content for thousands of content creators on YouTube. BBTV now leads the world’s third largest multi channel network.
Founded by chief executive Sharhzad Rafati in 2005 when she was only 25 years old, BBTV now boasts more than 12,500 channel partners, achieves more than 1.2 billion views from more lululemon outlet than 100 million subscribers and has almost 100 staff.
As a new computer science graduate from the University of British Columbia, Rafati started her company when large c lululemon outlet ontent owners were trying to determine how to monetize their content that was being “shared” read pirated over the Internet.
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Her technology was ingenious: It scours YouTube for fan uploaded content, then links the uploader to the IP holder, secures ads for the content and splits the revenue between them, while taking a fee for the service. BBTV also licenses content from independent creators and distributes it through its own consumer portals.
BroadbandTV is, in essence, a classic case of a new business using another to create a large business of its own piggybacking on a platform, so to speak. Rafati has become quite the expert on how to create a new business model from another business model.
“I launched BBTV at a time when major content owners were struggling with two big questions: How do I protect my content from being all over the Internet? and how do I unlock the value of the Internet to monetize my content?” she says.
“The reason we focused on YouTube is because it became evident fairly quickly that YouTube would become the dominant leader in online video.
“It was ground zero for the democratization of video content online. They did a great job of not only giving fans the ability to upload video in a frictionless manner but they also provided companies such as BroadbandTV with tools that allowed us to create new innovative business models that could assist content owners with protection and monetization services.”
BBTV was among the first to recognize this opportunity, and, lest one think that this was just some lucky moon shot that worked, solid business principles also had to apply. Rafati points out that the keys to a startup are still the vision and core idea, which in BBTV’s case was to help content owners be more successful online.
“If you are clear on how you want to help your core customer, you will find the right medium and strategies by doing your homework on the marketplace,” she insists.
While she says a startup’s dependence on a larger entity is nothing new, Rafati does acknowledge there has been a change in the business world with the advent of large ecosystems created by companies such as Google, Apple, Facebook and Amazon.
“Clearly there are perils in building any kind of interdependence but you be hard pressed to start any business without some form of dependence on another entity,” she acknowledges.
“I believe the key is to consci lululemon outlet ously select partners and ecosystems that you believe in and that are being managed properly. Continuing your market research and being ‘in tune’ with the ecosystem and how it evolves is absolutely key so that you don compete with your own platform partner.”