E-commerce News and Insights
Mar 26, 2018

3 Advantages of Being a Startup in an Established Industry

3 Advantages of Being a Startup in an Established Industry

I never spent time in an executive role at a global shipping company. But I did have to deal with shipping as an obstacle when I was running my e-commerce business. My co-founder and I were making daily trips to the Post Office because we didn’t have a scalable way to run our shipping on autopilot.

So we built a V1 of the technology that aimed at chipping away at the problem we saw. And now, we’re continuing to improve upon it. Since we’re out-of-the-box as a company and as founders—and we’re bringing a completely new perspective to the market—we get a lot of questions. The most popular being “why should I take you seriously?”

I love that question because it’s totally legitimate. It pushes me to build a stronger, more relevant company and to stay true to the integrity of our product. Here’s what excites me most about the opportunity to bring something new to the table.

Startups Can Tackle Big and Small Problems

While larger, more established companies need to focus on their core business operations to stay stable, my co-founder and I have an opportunity to explore a growing niche. Established industries aren’t always the best equipped to solve their own problems. The distance between “cubicle” and customer is often too far. But we’re building the product that we needed when we were in our customers’ shoes.

It turns out, this due diligence put us in the right spot. With a V1 of our product, we worked out a way upstream. We started out by talking to e-commerce companies and recognized that others were in the exact same boat as us. Eventually, we found our way to bigger customers—all by staying focused on the tough challenge of making shipping more cost-effective and sustainable at scale.

Startups Can Help Small Companies Compete

Amazon has made it tough for smaller e-commerce companies to keep up with what their customers want. Everyday consumers don’t understand the nuances that go into offering perks like free and fast shipping—something that Amazon makes commonplace. What’s happening behind the scenes is actually more sophisticated: Amazon operates multiple types of businesses, which makes it possible for the company to offer free shipping at low to no cost.

Meanwhile, other types of businesses can’t afford this luxury and perk. Free shipping has the potential to be a major money drain. Big players in the shipping industry are focused on fellow big players. By solving a pain point for an up-and-coming market, however, we level the playing field for all companies.

That’s why big companies end up working with us, too. Our technology makes it possible for more e-commerce businesses to compete in today’s fast-moving information economy.

Startups Can Build Close Relationships with Customers

All companies are held accountable by their customers. But as a startup, we’re often held to a higher standard purely because we haven’t been around that long. We get it—we need to prove ourselves. That’s why we stay close to our customers by conducting regular interviews with them; something that bigger companies may not have the time, interest, or resources to do themselves. With an ear to the ground, we get to see the results that we’re driving, directly from our customers. With every conversation, we discover even more opportunities and low-hanging fruit to improve e-commerce.

As a first-time founder, it has always been important to build a business that makes real money. As newcomers to an otherwise crowded space, we’re under added pressure. But we don’t back down because of a little friction. Being newer means tackling challenges with a fresh eye.

This insight originally appeared in my column in Inc. You can find the full article here. For a deeper look into my experience as a founder, check out my article on starting a startup.

Shippo is a multi-carrier API and web app that helps retailers, marketplaces and platforms connect to a global network of carriers. Businesses use Shippo to get real-time rates, print labels, automate international paperwork, track packages and facilitate returns. Shippo provides the tools to help businesses succeed through shipping.

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Laura Behrens Wu
is the CEO and co-founder of Shippo

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