Technology Waves and How to Ride Them

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A few days ago in our team meeting I asked if anyone had ideas for what this week’s Divinations should be about. Someone suggested I write about how to create a viral product launch, since Lex’s launch went so well. My first reaction was that it was a good idea for a column, but readers might not love hearing that step one is “wait for a generational technology breakthrough.” Or, perhaps a bit more actionably, “build something using GPT-3.”

The truth is, Lex’s virality is entirely dependent on the underlying technology wave it is riding. I’ve launched many apps in my career using very similar tactics as I did to launch Lex—none of them went this well. Sure, there’s value in learning marketing techniques, but if you apply them to products that don’t generate “holy shit” moments, you won’t get the same result. Furthermore, it’s rare to achieve that kind of visceral reaction to a product without tapping into a new, rapidly-improving technology.

“That’s the post!” my co-founder Dan said. “You should write about technology waves.”

I’ve seen a lot of technology waves in my time: cloud, social, mobile, wearables, crypto, and now AI. Every time, the same story plays out: there is a long gestation period, followed by a breakthrough story that kicks off a hype cycle. Lots of silly decisions get made, and most of the hoped-for value never materializes. But then the dust settles, the tourists leave, and a smaller group of people keep building; before you know it the technology gets woven into our lives in a boring-yet-useful way.

Astute readers may recognize this story as the Gartner Hype Cycle:

There is no simple “correct” answer for where you want to be in this cycle. In theory it’s best to be the first mover that creates the original technology trigger that kicks off the whole cycle, but often those companies don’t capture the value in the long run. For example, the profits from the PC era mostly flowed to Microsoft and Intel, but those profits depended on ideas that originated elsewhere, like GUIs (invented by Xerox) and spreadsheets (Visicalc).

Sometimes things seem like technology waves but actually turn out to be mirages. It once seemed like scooters were going to be an amazing business, turns out that’s false. At one point people thought chatbots would be the future of all software, that didn’t pan out. Voice interfaces like Alexa are stagnant. And does anyone remember checkin apps like Foursquare?

The most valuable wave to ride is not necessarily the most hyped one. When you’re looking for a wave to ride, the best have three things in common:

1. They’re big, in the sense that they have the potential to dramatically change how people do things.
2. They’re early, and the potential for change has not yet been captured.
3. They have underlying technology that is improving rapidly and is set to continue improving for a long time.

Of course, finding these waves and riding them is easier said than done. This post is about how to do it.