Diversification
Diversification can be an important part of the growth journey for a startup. It involves introducing new products, services, or even business models to your existing one in order to expand your customer base and sources of income.
Expansion may include entering new markets, launching innovative products/services, or purchasing other companies.
A Scenario : Understanding Diversification
John is the brains behind a mobile app business that has been flourishing for almost a few years now. He was able to turn it into a stable source of income and the future looks bright for his venture.
John understands that the mobile app industry is very competitive and he wishes to diversify his business activities so as to reduce the reliance on only one source of revenue.
John put in a lot of effort to research and explore different market segments so as to identify any potential prospects. His extensive market research gave him insight into the need for an online education platform, leading him to take up the task of creating one himself & making it accessible through mobile apps.
To kick-off his venture, John recruits a team of professionals with background in developing e-learning websites. He collaborates with educational organizations to supply content for the platform. Additionally, he formulates a business plan and an advertisement plan to publicize the platform.
John has put in a lot of effort and dedication over the past few months to develop his online education platform. This hard work has paid off, as the platform is now ready to go live with a considerable number of users ready to use it, along with the potential to generate revenue.
His choice to diversify his business has proven to be a wise decision. This approach allowed him to reduce the dangers of depending on just one income stream while at the same time expanding his enterprise.
In this scenario, John wisely chose to diversify his business, reducing the reliance on a single source of income and helping him to develop and grow. This strategy of diversifying a startup business can open up possibilities for entrepreneurs, potentially creating new sources of income.
