Data, per se, and access to actionable insights about customers, markets, and performance, have long been viewed as highly valuable assets capable of enabling outsized market performance and potentially creating defensive “moats” for emerging companies. For those reasons, we see continually increasing emphasis on the ubiquity of sensors in hardware and machines and associated software applications, the deployment of computer vision in locations and facilities, automation in data collection and the application of intelligent learning algorithms for analysis of these new data streams, just to name a few areas. No doubt, this will continue. But we have also come to realize that a company’s superior understanding of data scale effects and their impact on product viability and optimization can be key to a company’s success.
More specifically, understanding the “minimum viable data set” required to create value initially and how to effectively obtain it, and then understanding the “tipping point” at which the cost of additional data accumulation is not worth the incremental value, can each be keys to the creation of successful emerging businesses. Put simply, “more” data is not always better or needed, and in fact can be counterproductive. “Enough” data is required at the outset to yield initial dependable insights for a viable product. And “sufficient” data is required for a complete and mature product, to be sure. But understanding how much data is “enough” to create value at each stage -- and how to get it -- is rapidly becoming one of the key core competencies for emerging companies. And a program simply of ever-increasing data accumulation may result in cost and inefficiencies in analysis that outweigh the incremental value, if any, of an expanded data set.
The “right” amount of data varies by industry, by the nature of the solution, and by stage. We see this directly in sectors such as digital health, logistics, future of work, and even industrial manufacturing and safety. How teams solve these data equations and how they execute against the answers they find will be increasingly major factors in determining their success.