Why You Should Consider Starting Your Next Business in a New Market

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Starting a business in a new market might involve various risks, but it definitely offers just as many opportunities.

7 min read

Opinions expressed by Entrepreneur contributors are their own.

What do cannabis, blockchain and artificial intelligence have in common? You probably guessed it already: All these sectors have only been around for a couple of years, and most of their players are still in the early stages of their businesses. Additionally, they are often associated with regulatory nightmares, countless hurdles from established players and lots of failed companies.

However, it is also known that new markets like cannabis and blockchain are growing quite exponentially, with entrepreneurs and investors becoming millionaires or even billionaires overnight. Regardless of whether you are just starting out or are an experienced entrepreneur, setting up shop in a new market can bring a number of priceless benefits that traditional industries can never match. Here’s why it may be just the right thing for you.

Get an early start

Newly emerged markets represent an opportunity to establish an early foothold in what could turn out to be a massive, global economy impacting billions of lives. As you might imagine, early movers in nascent markets stand to reap potentially lucrative rewards later on and can play a role in shaping the industry as a whole. 

With that said, blazing the trail is easier said than done, but many entrepreneurs thrive on taking up daunting challenges and are accustomed to taking risks that could pay off big time in the future. Those setting up shop in a new industry will likely have to navigate a veritable gauntlet of obstacles, which can range from regulatory challenges, a shortage of skilled labor and a lack of off-the-shelf solutions for many business operations.  

The booming blockchain industry is a poignant example of the potential challenges and benefits of jumping into new, high-potential industries at an early stage. Since it first emerged in 2008, the blockchain technology sector has grown to become a $3 billion industry that is expected to grow at a Compound Annual Growth Rate (CAGR) of 67.3 percent between 2020 and 2025. Early adopters and key growth enablers like Canaan Creative and Coinbase have seen the benefit of their early risk-taking and are both valued in excess of $1 billion. 

Related: Coinbase Snags Top Tech Execs From Facebook, Amazon

But to get to this position, both firms — and the numerous other blockchain unicorns — had to overcome a number of obstacles, which include various social media outlets banning crypto currency advertising and various regulators cracking down on crypto businesses. But as firms adopted clever growth strategies and launched highly sought after products and services, these recent setbacks have done little to slow the growth of the industry as a whole. 

Marco Mottana, who is simultaneously active in two new markets with his company CFX Quantum, believes that entrepreneurs in new industries are usually ideology-driven and are therefore motivated to tackle the obstacles that others avoid.

“Every new industry is its own Wild West,” he says. “The rules of the game have not yet been established — you have to negotiate every little thing ‘manually’ and actually create these rules. My company was and still is confronted with these difficulties, yet my team and I are prepared to take on great challenges since we firmly believe that our technology can contribute significantly to the development of reliable financial instruments.” 

Related: The Identity Of Entrepreneurs As An Engine Of Growth

Innovate and set the standard

Innovation is the key to progress, but many business leaders and entrepreneurs see their creativity and inventiveness stifled over time as their business begins to adopt a more corporate structure and turn its focus to ensuring stable growth for their shareholders and investors, rather than pushing the bar. 

In the context of a new market, innovation is rarely an optional step, because there are undoubtedly numerous other upstarts looking to make a name in

Source: Entrepreneur.com

Continued here:
Why You Should Consider Starting Your Next Business in a New Market

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