Tag Archives: Build

A Sober Second Look at Silicon Valley

I, like many other people, have griped about the lack of venture funding in Winnipeg / Manitoba / Canada. Especially compared to the States. For a country with 10% of the population, there isn’t near the same proportion of start-up funding that they have. I can’t believe it’s because there is any difference in quality of people or ideas.

There are some macro reasons and some micro, but we often don’t look at it from the other side. Maybe Silicon Valley is the one out of whack?

I don’t know and it’s up to smarter people than me to debate, but this is a very interesting article that gives a rare perspective of the other side of the dream.

http://blogs.reuters.com/felix-salmon/2014/04/21/the-most-expensive-lottery-ticket-in-the-world/

I don’t think that we should stop working toward a better business environment in Winnipeg, but maybe we should define the goal of what we’re working toward before striking out.

Should Businesses Begin at the End?

Beginning with the end in mind is a best practice that we hear about all the time. When I took my project management course it was pretty much the first thing that we were taught in it. While this likely is a good idea for short-term endeavors, is this really how we want people thinking when they start a business?

In the entrepreneurship classes I took, as well as books I’ve read and speakers I’ve gone to see, the “exit strategy” is a major focus. Essentially when you start a business you should have a timeframe to cashing out, most typically in the form of a sale.

While putting a timeline and dollar value on the sale of the company may be good for investors to see, is that really what is best for our companies or economy in general?

If your thought from the outset is that you are not going to be running the company for more than a few years, how will decision making be impacted? All decisions will be made with the short term in mind, which is never good for any company.

The idea of running a business for a few years then cashing out is nice and clean, especially academically when trying to teach about ownership, it doesn’t translate well into the real world.

I have a hard time believing that the entrepreneurs that I admire thought to themselves, “I have this great business idea that I can run for 5 years then retire.” I don’t remember ever reading the “Starting the Business with an Exit Strategy” chapter in any of their (auto)biographies.

If you want some more concrete examples, just look around. Bill Gates recently announced that he is taking more of a day-to-day role in Microsoft. Warren Buffett is in his 80s and still running the company. Steve Jobs came back to Apple (his baby), leaving behind another successful company. Richard Branson is still running around doing his thing.

All the above listed are rich enough to do pretty much anything they want. So what do they want to do? Stay involved in their companies!

Thinking in the longer term is also better for investors. It keeps the imagination going and the company focused on limitless growth, rather than hitting a number for sale. As a VC, would you prefer to have been an early funder of Facebook (a company that only when public when it had to) or Groupon (who rushed to IPO and is now tanking)?

One of the companies is focused on being around for a long time, while the other was focused on making a quick buck. And the results speak for themselves.

Nothing is Ever Perfect

As a general rule, it frustrates me when people speak in absolutes. “______ is the best player ever,” or “Company x is never going to be able to pull themselves out of this.” As far as I’m concerned, no one can tell the future, and if you can why the heck are you wasting your time talking to me? Go buy some lottery tickets!

For this reason it makes me irate when people describe a product as “the best it’s ever going to be”. To me perfection is unattainable but it is something we should be striving for every day. Case and point, other than in nature, there are always improvements that can be made.

What got me thinking about this for a post is that I happened to see one of my brother’s fishing magazines on the kitchen table while eating breakfast. Since I wasn’t doing much else I decided to leaf through it. What was inside was actually pretty inspiring.

Before I go on, I should say that I’m not an avid fisher by any stretch of the imagination. I only go a few times a year and have had the same rod since my Granddad gave it to me about 15 years ago. I enjoy it, but not enough to consider it a hobby.

That didn’t matter to me, though, because the passion seeping through the pages of this magazine was inspiring. The articles and ads created by people who love (and I mean LOVE) fishing clearly shows that the sport embodies exactly what I stated a few paragraphs ago: The relentless, but futile, pursuit of perfection.

If anything had progressed to the point of perfection, would it not be fishing? Literally one of human’s oldest activities, we have had thousands of years to hone the tools used for fishing. The result of all this time and, I’m sure, literally billions of minds thinking about to improve fishing and it’s still not perfect. There is still new thought being put into it.

I know the pessimistic side of this: That products are developed to encourage unnecessary consumption, and in some cases that may be true. I would say, though, that an avid fisher knows more about fishing than I know about any particular topic and if they are taking the bait (so to speak) who am I to say the product isn’t legitimately better?

As far as I’m concerned, more people need to think this way. Who is so vain to think that something they have been working on for a year or two or even ten can’t still be improved? It may very well be the best product that you can produce at that time, but there is always a way to make it better.