Chase a Startup Trend or Stay True to Yourself?

Xiaomi founder Lei Jun famously said, ‘Even a pig can fly in a strong tailwind.’ Many founders consequently chase major trends such as AI, Web3, or the metaverse. Consider Lei’s background. In 1992, newly graduated and twenty-three, he joined Kingsoft. He became general manager in 1998, when Pony Ma was just founding Tencent and Jack Ma was still pitching China Yellow Pages. Riding the internet wave, the two later created China’s representative internet giants, leaving the previously leading Lei behind. Lei is intelligent and hardworking, yet missed the internet wave. Alongside the flying-pig remark, he reflected: ‘There are too many smart, hardworking people. These are only prerequisites, not guarantees of success. What really matters is moving with the trend and finding that tailwind.’ In VC assessment, beyond the team, we always examine industry size. Founders and teams matter, but the industry’s size is an even larger factor in how big a company can become. It implies a ceiling. Suppose one business monopolized 100% of the industry: its annual revenue and profits would define that ceiling. Founders and investors both need to dream. A ‘price-to-dream ratio’ reflects the room for that dream: its size shapes the stage and market value. Choose a small arena and the dream has an obvious ceiling, limiting value creation and enterprise value. Even someone as capable as Lei cannot fight his era or its trends. The wrong direction or arena creates bottlenecks and ceilings. RT-Mart founder 黃明端 also has a famous line: ‘I beat every competitor but lost to the times.’ Yet based on my eleven years in VC, my first advice is not to chase fashionable trends. Industries attracting major media attention have usually already achieved substantial results. Hearing the coverage and only then deciding to enter is, eight or nine times out of ten, too late. Trends are shaped externally; choosing by them makes your selection passive. Without differentiated advantages, the market eventually eliminates you. What happens to a flying pig when the wind stops? YC founder Paul Graham said, ‘Rather than ten thousand people who find your product acceptable, you need a hundred who passionately love it.’ A small initial market is fine if you genuinely solve a group’s problem and make them love and depend on the product, then seek expansion. Google’s founders did not know how large it would become when developing PageRank. Begin with a niche, focus resources, go deep, and monopolize that segment rather than immediately pursuing an all-encompassing platform. If neither a large arena nor a hot trend is the starting point, how do you choose and attract investors? As an investor, I do consider industry size and whether the field is worth backing. A founder can think differently. Start from your own needs, observations, passions, and ideals. Build something you love. Entrepreneurship is hard and frustrating; belief and love are often what sustain ten or twenty years of effort. This conflicts with the demand for a large market. Nevertheless, I recommend being yourself: build for your ideals and dreams, not for fundraising or investors.