Hubspot raised $32M. They are the predominant SaaS player in the marketing software space with over 4,000 customers. Great points about branding and how the internet age works disproportionately in favor for the winner of a space in the OnStartups.com article.
In the industrial age, distribution was done through middlemen. Thus a second and third brand helped the middleman (retailers, distributors, resellers, etc.) keep leverage in the relationship with the providers of goods and services. If Best Buy could not come to terms with HP, they could negotiate with Dell instead to carry similar laptops.
Today, it is a winner-take-all game. Cloud computing technologies work this way. The dominant player gets the spoils because they are number one. Their success reaps success and momentum. Salesforce.com or Google Apps for example leave other SaaS competitors obscure at best.
A Strategy For All Of Us
Here’s the strategy we should all be paying attention to: be number one in a distinct category. If you can’t be number one, redefine your category. There’s not much left for number two.
What is the category you are in? Comment below.