This post is (hopefully) the first in a series of my musings on entrepreneurship and lessons I’ve learned along the way.
One time, in my younger and more vulnerable years, I was living in Manhattan and got home late at night only to find that I was out of toilet paper. Not a problem – it’s New York, and there are bodegas open at all hours.
I went out, found an open bodega on 2nd Avenue, and asked for toilet paper. They only had one brand: Scott.
So being the naive, impressionable young man I was back then, I thought nothing of this, and bought it. And, long story short, Scott toilet paper is the worst toilet paper that has ever existed. It’s so thin as to be fully transparent, and it has the texture of old fax machine paper. Effectively unusable.
I didn’t think much of this experience until the other day, when I learned that Scott not only makes toilet paper, they actually invented the concept of toilet paper. These people are the Ford Motor Company of toilet paper and yet their product is light years behind the competition, crowded out into a triviality, a late-night bodega novelty for millennials to complain about on their blogs.
Well fear not, faithful reader, I looked into it, and this article from the New York Times in 1991 clarified a lot. It begins that, for Scott, “the beginning of the 1990’s has felt like the death by a thousand paper cuts.” Ouch.
The story, it seems, is a tale as old as time. Incompetence at all levels, layers of management insulating decision-makers from facts on the ground, enough debt to make your average QVC viewer blush, and assurances that, really, their past failures have been bad luck and nothing more. It’s not that everyone is a clown and the product sucks – no, it’s because of weird supply disruptions in the toilet paper market that temporarily decreased the going rate for a roll of Z-grade hygienic tissue.
Indeed! – the article goes on to explain – their first mover advantage had given them a competitive edge in both the toilet paper and pre-moistened wipe categories. But unfortunately, Scott’s engineers had to back-burner their plans to capitalize on these opportunities when existing machinery down at their toilet paper plants started uncontrollably catching fire and breaking.
And as a technology industry guy myself, I recognize this set of symptoms all too well: it’s the big-company, fat-and-happy, shirtsleeves-to-shirtsleeves story. It’s a tale of how companies become addicted to luxuries they never had before, like a sea of available credit, or the resources to put a management layer between the boss and the chaos. As they accept these luxuries, they make themselves less nimble, less agile, now reliant on huge amouts of money and people just to keep running.
They become less culturally willing to change anything, as people become more focused on not losing their cushy position than trying to actually increase shareholder value. They end up with a line of toilet paper that isn’t made to a modern standard, and they wonder aloud why they’re losing market share, despite knowing full well that they’d never buy Scott toilet paper in their own homes.
All these things serve to slow down the big incumbent, and under the right circumstances, it can even lead the market leader to an eventual death. But I’m not writing this to bash big companies, or to propose ways to solve their problems. There are plenty of smart people already focused on that. I knew many of them at Coinbase, and they’re brilliant.
No, the point I’m making is for the entrpreneurs. These are the flaws of your enemy, the gaps in their armor. These are the ways in which you, tiny unknown startup, have a leg up on your much larger competitor. You should milk this for all it’s worth. Respond to issues faster, have a more personal touch, and iterate the product based on customer feedback so they know you’re building for them. Take risks a behemoth wouldn’t take or couldn’t take – whether that’s with your brand image or your product decisions. After all, if you make a mistake, it’s a lot easier for you to course-correct than for them.
And, of course, I just find it generally amazing that the literal inventor of toilet paper makes the worst toilet paper in the whole world.