Deep Dive: The Full-Stack Way, A Startup Game Changer

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Today’s Deep Dive: 👨‍💻The Full-Stack Way, A Startup Game Changer👩‍💻

The Full-Stack Way, A Startup Game Changer

In a modern world where everybody strives to bring out new ideas, develop their creativity, and simply innovate, many are taking a step to generate income in the process. How? Startups.

Startups have seemingly become quite a movement in the U.S., constantly rising and impacting the nation’s economy. We see plenty of different types of startups, whether or not we realize it, starting from small and often buyable startups focusing on lifestyle and hobbies to large and scalable startups that often concentrate on the tech sector.

The rise in startup numbers has made the United States the leading country for most startups, being home to 75,056 startups as of 2023.

Nowadays, a different, important trend of startups has emerged, the full-stack startup. What are full-stack startups, exactly? And how do they benefit not only themselves but others surrounding them?

Full-Stack Startup

The term was first invented by tech entrepreneur and American investor Chris Dixon. Dixon believes the startups that warrant the status “full-stack” are ones that develop and build a complete, end-to-end product or service all on their own, non-reliant to partners in their activities.

By that definition, it seems that we are actually surrounded by quite a lot of full-stack startups. We had just never realized it before since we didn’t know a term that specifically entails them even existed. An example that could be familiar to some is Apple. Unlike Microsoft, for example, which relies on partners for assemblage and retail, Apple designs its own chips, OS, phone hardware, apps, packaging, and retail experience.

A similar approach is taken by famed ride-sharing apps Lyft and Uber. Instead of building and pitching software to existing taxi or limo companies to better their services, Lyft and Uber created a whole new experience, providing a similar service from scratch on their own.

From only a few examples, it is probably already apparent that full-stack startups work. Apple has become one of the biggest tech giants in the world, being part of the Big Five, and many can say that Lyft and Uber rides have surpassed traditional taxis’.

So, why aren’t more startups taking the full-stack approach?

Cost

Going the full-stack way can most certainly be beneficial, mainly seen in how successful those utilizing the full-stack approach have become. One big thing this approach entails, however, is the ability to take care of every aspect of your products or services, and this can undoubtedly be more than challenging.

To properly manage a full-stack startup, you would have to be able to explore more than one core competency. Software, hardware, and design developments, as well as consumer marketing, supply chain management, and regulation, are all in your hands.

Consequently, founders and teams that can exercise various competencies need to be developed, and that can be not only tricky but also time-consuming.

Having to handle a multitude of complex aspects to build your business will also require a great deal of capital. Aside from the far-from-simple process of funding, by being capital-intensive, your company may take longer than usual to reach the inflection point needed for growth and need to get more creative to achieve said point.

Building a full-stack startup would require you to go the extra mile, for sure, but the result might be worth all the hardship.

Benefit

Exploring and developing a variety of competencies, as discussed above, can make your business one with multiple products, giving you not only flexibility but also a bigger value. By mastering all the different products, services, and as a result, the operational processes and components your business entails, you can continue to grow and attract a sizeable market.

In addition to this, once you create a successful full-stack startup, it would be difficult for other startups in the same field to challenge and compete with your business.

Aside from benefiting your own business, creating a full-stack startup can greatly influence the startup ecosystem by increasing competition and technology adoption and becoming an infrastructure.

By launching your full-stack startup, you can become a catalyst that increases competition. Founders and teams looking to build startups the full-stack way may try to adopt similar technologies, potentially creating a new generation of startups. Building a full-stack startup in a certain sector can also attract a new set of markets and companies pursuing the same field.

An example would be Elon Musk’s SpaceX. The emergence of SpaceX in the commercial space industry has resulted in a number of businesses having their products and services viable to get to space. The hardship that the SpaceX team had endured gave relatively smaller companies a similar chance without having to go through the same technological and economic hindrances.

Although proficiency in technology seems to be a necessity when it comes to building full-stack startups, the approach can be applied in various industries.

Industry Application

Aside from the examples previously mentioned, the full-stack approach has been seen in other industries, as well, such as defense, freight and transportation, construction, and education.

Anduril, a company in the defense industry, focuses on building products for defense by detecting, tracking, and intercepting unmanned aircraft and autonomous drone systems. Instead of starting as a supplier of defense primes, they have instead become defense primes themselves.

Flexport, a company that built software to organize and coordinate shipments, chose to become a software-powered freight forwarder themselves instead of selling software solutions to other freight forwarders. Startups adopting a similar approach also include Intramotev and Fleetzero. 

At the moment, the full-stack approach in the freight and transportation industry entails building entire vehicles instead of being suppliers to original equipment manufacturers.

Different examples of full-stack startup approaches can be seen in the construction industry. Cover, a residential construction company, runs and owns the end customer relationship and production capacity. Assembly OSM focuses on scalable, sustainable, and inclusive automated residential construction.

Lastly, in the education sector, exists a startup pursuing the full-stack approach called Campus. Campus is a national community college that allows students to complete their first two years of college completely online.

Building a full-stack startup is a challenging and arduous task that opens up founders and teams to a whole new level of achievement by impacting not just yourself and your team but also professionals who may pursue a similar goal. A new wave and generation of startups may emerge if you just start.

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