The 'Why Now?' Question: Assessing Market Timing for a New Tech Product
A great idea is not enough. A great team is not enough. A huge market is not enough. For a startup to have explosive growth, it needs one more, often overlooked, ingredient: timing. Why is this a compelling opportunity *right now*? Why hasn't it been done before? Why is the world finally ready for this solution?
The "Why Now?" question is a favorite of venture capitalists, and for good reason. It separates well-meaning ideas from truly timely opportunities. A compelling answer to "Why Now?" can be the difference between a business that struggles for years and one that rides a massive wave of adoption. As a discoverer or investor, learning to assess market timing is a critical skill.
What Creates a "Why Now?" Moment?
A window of opportunity is usually opened by a powerful, external force. This force, often called a "tailwind," makes it easier, cheaper, or more necessary to build a certain type of business today than it was a few years ago. There are three common types of tailwinds.
1. Technological Tailwinds
This is the most common driver of new startups. A new technology emerges or becomes mainstream, which enables a whole new class of products to be built.
- Examples: The widespread adoption of high-speed internet enabled video streaming (Netflix). The release of the iPhone created the mobile app economy. The recent advances in large language models (like GPT-4) are currently enabling a Cambrian explosion of AI-powered startups.
- What to look for: Is the product riding on the coattails of a major new technology platform? Does it do something that was impossible or prohibitively expensive just two years ago?
2. Regulatory or Legal Tailwinds
A change in laws or regulations can instantly create a massive new market. Companies that are prepared for these changes can have a huge first-mover advantage.
- Examples: The legalization of cannabis in many regions created a multi-billion dollar industry for everything from cultivation to retail software. New data privacy laws like GDPR created a need for a new class of compliance and security tools.
- What to look for: Is there a new law or regulation coming into effect that will force companies to change the way they operate? Does this product help them navigate that change?
3. Cultural or Behavioral Tailwinds
This is about a fundamental shift in how people live, work, or interact. These shifts create new needs and new problems to be solved.
- Examples: The shift to remote work during the COVID-19 pandemic massively accelerated the adoption of collaboration tools like Slack, Zoom, and Notion. A growing cultural awareness around mental health has created a large market for meditation and therapy apps.
- What to look for: Is there a major societal trend that this product taps into? Does it align with a new way people are thinking or behaving?
Why Timing is So Important
Being too early is, in many ways, indistinguishable from being wrong. Many great ideas have failed simply because the market wasn't ready, the enabling technology wasn't mature enough, or the cultural behavior hadn't shifted. Conversely, a startup that catches a powerful tailwind can seem like an overnight success, as the market pulls the product from them.
Assessing the timing is a core component of evaluating the "Market" pillar in any new venture.
- Return to the main framework: The Art of Analysis: A Framework for Evaluating Early-Stage Tech Ventures
Listen for the Tailwinds
The next time you watch a pitch, listen carefully for the answer to the "Why Now?" question. Does the founder have a clear and compelling reason why their idea is perfectly suited for this moment in time? If they do, you may be looking at a business that's about to take flight.
Discover founders who have an answer for "Why Now?".