Your Next Successful Business That You Don’t Know About Yet
The news this week is that the Amazon Web Services business unit may surpass Amazon’s core retail business (you know, books, music, etc.) in revenues soon.
It’s the “Cloud”. Amazon started renting out part of the enormous digital infrastructure required to run the online retail part of Amazon back in 2006. For a small fraction of what is would cost them to run web-scale applications on their own, companies can get that capability from Amazon Web Services (AWS). Without much marketing at all, the word spread among other companies looking for a bargain, and business at AWS is booming now.
Define “booming”, you might respond. Okay, try this: AWS hosts more than 1.1 million websites, 9.3 million host names, and over 5% of the globe’s Top 1000 busiest sites. AWS’s S3 (Simple Storage Service) platform has over 2 trillion digital objects sitting on it.
According to Morgan Stanley, AWS will surpass $24 billion in revenue by 2022, but according to the CEO of AWS, that is less than 15% of AWS’s eventual size. For the sake of comparison, Amazon did $61 billion in revenue 2012.
The purpose of giving you the data around Amazon and AWS is to point out a situation that happens with some frequency in business; the core business being eclipsed by a new business.
Here are some examples.
BMW started out making aircraft. Honda started as a bicycle manufacturing entity. Hewlett-Packard started out making electronic meters and measurement devices. Craigslist started out as an email newsletter sent out to software developers. Tag Heuer, the luxury watch manufacturer, started by making utilitarian stopwatches for track events. Samsung started out as a trading company, selling insurance, textiles, stocks, noodles, and more. Abercrombie and Fitch sold camping equipment. The list goes on and on. Sometimes the company kept producing their original products in tandem with the new product, but often, they just abandoned their original product (or sold off that part of the company), and moved forward with the new business.
Our company is also a good example of this phenomenon – we started out doing business consulting over 20 years ago, but now, most of our clients come from the tax, accounting and payroll services we provide to businesses. We still do business consulting, and we’re proud of how well we do it, and our clients love the help we give to them in this regard, but it’s a small part of our overall activities here at the firm.
The point is this. You just never know when another business opportunity is going to show up as you’re going about the daily activities of running your current business. And if that does happen, take a good, long look at it before you say to yourself, “Nah, that’s not what we do”.
Because that thing you don’t do now might just be your next, wildly successful business.