Are you starting a service or technology company?

• 1 min read

You can describe any new startup as either a service company or a technology company.

The easiest way to tell is whether you could carry out the service pretty well on the end of a phone with enough people. In this case, technology isn’t essential until you need to scale beyond the point the economics of manually doing the job make no sense. These are your marketplaces. They connect people and make clunky processes efficient. Think Airbnb, Uber etc. At scale, tech is just as essential to be a real differentiator.

On the other hand, a technology company can’t exist without the underlying tech. It’s something that is possible now that wasn’t before. Stripe, AWS, Mighty, Descript, products built with GPT3.

The main point of differentiation between the two is when the tech matters, pre or post product/market fit.

It’s easy enough to wizard-of-oz a service company. It’s much more challenging with a technology company — often impossible.