29 March 2013

Entrepreneurs and Unions and Abuse of Political Power

One take on the issue of unions in today's environment--

Mish's Global Economic Trend Analysis: One Man’s Fight Against Union Power: " . . . Silicon Valley entrepreneurs come from a variety of ideological leanings, but it is accurate to state that most of them support Democratic political candidates. Perhaps this, combined with their extraordinary personal wealth, blinds them to the agenda of unions, despite the fact that public sector unions already control California’s state and most of its local governments and their unsustainable financial demands are contributing to the insolvency of those institutions. If the Silicon Valley business elite want to maintain control of the companies they founded, and preserve the vitality of the new industries they helped create, they should take a careful look at the proper role of unions in 21st century America. Because the rules governing unions and union organizing are at a tipping point. If union-friendly legislation continues to emanate from Washington D.C., and Sacramento, the Silicon Valley may find itself on the front lines of a battle for which they are entirely unprepared. . . . The only way to stop such abuses is to curtail union privileges especially public union privileges. Three Needed Solutions:
  • We need National Right-to-Work Laws
  • We need to scrap Davis-Bacon and all prevailing wage laws at the state and national levels
  • We need to end collective bargaining of public unions"
Read more at http://globaleconomicanalysis.blogspot.com/2013/03/one-mans-fight-against-union-power.html#sSwJUS7uoR71bHXZ.99

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27 March 2013

SXSW - small ideas, ennui, exhaustion, and BBQ

Kara Swisher at SXSW: Too Much BBQ, Not Enough Fresh Ideas | Vanity Fair: " . . . To be fair, it’s hard to resist that with great BBQ places like Ironworks so close by the Austin Convention Center and then the endless food trucks offering ribs, chicken, pulled pork, and more. So you don’t—unless you are a dedicated vegan with a whole lot of self-control. But if you continue on your truth-telling journey, the vague ennui and inevitable exhaustion felt at SXSW is actually due this year to more than bad choices of protein. It’s that there has really been little fresh to see, interactively-speaking—no apps or technology that has jumped out at you and grabbed your attention the way Foursquare or Twitter most definitely had in the past. Maybe it’s because tech is running out of bracing ideas, which is the constant agonizing worry of those in Silicon Valley and the topic of a periodic mainstream-media thumbsucker on the issue that is usually titled: “Is Innovation Dead?” It’s not and really never is, although some fret that in the new app-centric, mobile-obsessed tech culture, perhaps some of the ideas are also shrinking. “There are a lot of big minds chasing small ideas,” said one weary investor to me recently. . . ."

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25 March 2013

How's it going?

The Entrepreneur's Hoax, and Why I Won't Play Along | Built In Chicago: " . . . . So what’s my response when someone casually asks, “How’s it going?” On good days and bad days alike, I say something like “It’s going, thanks. We’re chugging along, making progress every day.” And we are. Moxie Jean is a lot bigger, and we’re ten times smarter than we were just a few months ago. We’ve figured out so many pieces of the puzzle (some painfully and all through trial and error). But truthfully, we still have some big things to figure out, and I ask my friends, mentors and investors for help and advice all the time. I also try to be candid in sharing lessons, wrong turns and times of struggle, mostly because turning events into coherent stories helps me process it all, but also with the hope that other people will know that their own doubts and disappointments are part of the normal life of a startup entrepreneur." (read full article at link above)

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22 March 2013

New Customer Capitalism

Capitalism, After The Election - Forbes: " . . . Instead of blaming the ratios, we need to join theorists like Peter Drucker, Roger Martin and Ranjay Gulati as well as practitioners like Jack Welch who have recognized that the very goal underlying these ratios is wrong. Fixing the goal of the firm on making money for the company and its shareholders used to work but is now “the dumbest idea in the world”. The ratios are merely the means of implementing an obsolete idea. We need to root out this obsolete idea and recognize that the goal of making money for the firm and its shareholders leads systematically at the microeconomic level to the destruction of the firm and at the macroeconomic level the destruction of the economy.
Maximizing shareholder value: the dumbest idea in the world . . . By 2010, when all those elements were in place, the world was ready for customer capitalism. Roger Martin writes:

“We must shift the focus of companies back to the customer and away from shareholder value,” says Martin. “The shift necessitates a fundamental change in our prevailing theory of the firm… The current theory holds that the singular goal of the corporation should be shareholder value maximization. Instead, companies should place customers at the center of the firm and focus on delighting them, while earning an acceptable return for shareholders.”

If you take care of customers, writes Martin, shareholders will be drawn along for a very nice ride. The opposite is simply not true: if you try to take care of shareholders, customers don’t benefit and, ironically, shareholders don’t get very far either. In the real market, there is opportunity to build for the long run rather than to exploit short-term opportunities, so the real market has a chance to produce sustainability. The real market produces meaning and motivation for organizations. The organization can create bonds with customers, imagine great plans, and bring them to fruition.

Similarly in Reorganize for Resilience, Ranjay Gulati writes:

Those companies built around an inside-out mind-set—those pushing out products and services to the marketplace based on a narrow viewpoint of their customers that looks at them only through the narrow lens of their products—are less resilient in turbulent times than those organized around an outside-in mind-set that starts with the marketplace, then looks to deliver creatively on market opportunities. Outside-in orientation maximizes customer value—and produces more supple organizations. Embracing an outside-in perspective—focusing on creatively delivering something of value to customers instead of obsessing over pushing your product portfolio—builds an inherent flexibility into organizations.

. . . Yet customer capitalism isn’t easy for traditional managers to implement because it requires a fundamentally different way of managing. It’s a new ecosystem, a new way of speaking, thinking and acting in the work place. It implies not just a new organizational goal, but also a number of other changes in managerial behavior:
a shift from controlling individuals to self-organizing teams;
a shift from coordinating work by hierarchical bureaucracy to dynamic linking;
a shift from a preoccupation with economic value to an embrace of values that will grow the firm; and
a shift from top-down communications to horizontal conversations."

Read also:

The dumbest idea in the world: maximizing shareholder value

The phase change to the Creative Economy

The identity crisis of American capitalism

Is delighting the customer profitable?

The best-kept management secret on the planet: Agile

The five big surprises of radical management

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20 March 2013

The Pressures on Founders

An article worth reading and pondering--

Should We Talk about the Fact That Jody Sherman Didn't Just Die, But That He Killed Himself?  - LAUNCH -: ". . . . Perhaps we owe it to these three amazing humans to examine if the pressures of being a founder, the pressure of our community's relentless pursuit of greatness, in some way contributed to their deaths? I've always believed that being a founder is an unhealthy pursuit at times, and few have disagreed -- certainly not those who have done it. Read any biography of a successful founder and you'll find collateral damage around -- and certainly in -- those individuals. Startups are a full-contact sport. This is a good time for all of us to pause and think about why we're doing this. And the impact it's having on us and the people around us. I'm not an expert on suicide, but I am an expert on being a founder. Many of the founders I know have been desperate, depressed and overwhelmed in their careers. For everyone that shared this with me, I'm certain 10 more didn't. Could these deaths have been avoided? Perhaps. Is it worth exploring why this happens and if it is, in fact, a trend? Absolutely. . . . ."

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18 March 2013

When US Manufacturing Hits a Wall

MIT Report: U.S. Manufacturing Hits a Wall When It's Time to Scale | Xconomy: " . . . Here’s how the rough timeline broke down: MIT says that “on the whole,” the 150 production companies it studied were able to get financing that bankrolled their early growth in the U.S.—sometimes for up to 10 years. “But many of them, when they came to the stage of moving to full-scale commercialization, could not find finance in the U.S.,” the report says. “As many of them made the transition from venture funding to high-volume manufacturing, they eventually had to look for foreign investors and often moved abroad to manufacture their products.” That’s just a preview of the findings from MIT’s big study, which is expected to publish its final results in a pair of books later this year. It’ll be interesting to track the research as more detail emerges, to see just how significant the exodus was for those companies being tracked. . . ."

see also: 50 Disruptive Companies 2013 - MIT Technology Review

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15 March 2013

Bridgewater Is the Hottest Hedge Fund

Bridgewater May Be the Hottest Hedge Fund for Harvard Grads, but It’s Also the Weirdest - The Daily Beast: ". . . Bridgewater, which has 1,300 employees, isn’t for ex-jocks or day traders. Rather, it tends to attract—and look for—self-styled intellectuals and deep thinkers who like constructing arguments as much as they enjoy constructing portfolios. It’s “the thinking Yalie’s destination,” as one recent Yale graduate put it. Undergrads at Harvard report that the scandal-free firm is more desirable than Goldman Sachs, previously the ne plus ultra for young grads on the make. “Bridgewater is very popular because it is one of the few hedge funds that will accept people right out of college,” says a Harvard undergraduate who interviewed with the firm. “Also, the hours tend to be better. In investment banking you’re working 100 hours a week, and at hedge funds it is more like 70.” (This student may be overestimating the amount of time employees of both investment banks and hedge funds spend working) . . . . "

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13 March 2013

Rigging the IPO

Rigging the I.P.O. Game - NYTimes.com: " . . . . Earlier this week, I tracked down Toby Lenk, the founder and former chief executive of eToys. Back when the S.E.C. was investigating I.P.O. excesses, the government deposed him. During the deposition, he mostly defended Goldman Sachs, even though he had the uneasy feeling that eToys had been taken advantage of. After the deposition, he recalled, the S.E.C. lawyers began to show him some Goldman Sachs documents. He saw that one big firm after another had been allocated shares — and had immediately flipped them, even though Goldman had promised that its clients would support the stock. “That’s when I thought, ‘We really got screwed,’” Lenk told me. Although the experience still angered him, he now has 14 years’ worth of perspective. “Look at what has happened since then,” he said. “If you think eToys got screwed, what do you think happened to the country?” “What Wall Street did to us in 1999 pales in comparison to what they did to the country in 2008,” he said."

And these are the guys (Wall Street) that Washington bailed out with taxpayer funds and Federal Reserve free money!

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11 March 2013

Developing Innovative Ideas for New Companies

The course Developing Innovative Ideas for New Companies by Dr. James V. Green from University of Maryland, College Park will be offered free of charge to everyone on the Coursera platform. Sign up at http://www.coursera.org/course/innovativeideas

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08 March 2013

Venture Capital Returns

chart of venture capital returns
source: avc.com

A VC: Venture Capital Returns: " . . . Early stage investing is hard. You lose more than you win. And when you win, you need to win big. Later stage investing is a bit easier. You can pick winners in that business more easily. But so can everyone else. Each deal is an auction and the winner pays the highest price. So the next time you are bidding one VC against another, maybe you can feel just a bit of empathy for us. We are in a tough business, trying to make a buck to live to fight another day. Just like everyone else."

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06 March 2013

High Wire Artist Philippe Petit's Advice

World Trade Center High Wire Artist Philippe Petit's Colorful Advice For A Career On The Edge | Fast Company: " . . . 5. Improvise. Improvisation is turning away from a well-polished plan within a millisecond because there’s no such thing in life as a well-polished plan. One of my favorite activities is to jump from rock to rock in a running torrent in the bed of a river. When I jump, I do not know where I’ll land. I’m in the air and there are six rocks around me and in a millionth of a second I see that I’d slip on the one to the right because it’s covered with moss, the one to the left is a little too far and I decide to come down on that little flat rock just ahead. But, before landing, I’m planning my next move. Of course, in our twenty-first century full of helmets and knee-pads and “don’t-try-this-at-home,” people will say: “You should go with three people observing you, just in case you fall so they can rush you to a hospital.” But, if you put all your energy, talent and intelligence into an action such as landing on the right rock, then failure is not an option. You cannot slip. You cannot fall. You cannot land in the water."

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04 March 2013

Telecommuters more productive

Marissa Mayer's Guide to Being Productive: It's About Data, Not Politics | Think Tank | Big Think: " . . . Richard Branson, for instance, called the move "a backwards step in an age when remote working is easier and more effective than ever." Other critics have called Mayer a hypocrite for building a nursery for her baby in her office. Not every cubicle-bound Yahoo, after all, has that option. And for working mothers, Maureen Dowd points out, telecommuting is a lifeline to a manageable life. To make matters worse, a Stanford University study that tracked stay-at-employees at a Chinese travel agency was released around the same time the Yahoo memo was leaked. The study found these workers were more productive than their counterparts who hailed from the office. . ."

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01 March 2013

Mistakes Startups Make In Picking A Domain Name

3 Common Mistakes Startups Make When Picking A Domain Name | Morgan Linton: " . . . three common mistakes I’ve seen startups make when picking a domain name: Picking a brandable that nobody can spell – brandables can be great if everyone can hear the word and instantly know how to spell it correctly. You should be able to tell someone your brand name over dinner or drinks and they should be able to get home, go to their computer, and easily access your site. Sun.com is an awesome domain for a lighting company, Suunn.com is a confusing one leading many customers to email you at Sun.com and try to find your site on Sun.com. Using an extension nobody has heard of – the world has become comfortable with extensions like .CO, .ME, .TV, .IO, .LY, etc. However almost nobody in the world knows .AM, .MD, and many other obscure ccTLDs . . . Assuming that one day you will get the .COM . . . " (read full article at link above)

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The 7 Habits of Highly Effective Mediocre Entrepreneurs | TechCrunch: " . . . . persistence is not the self-help cliche “Keep going until you hit the finish line!”. The key slogan is, “Keep failing until you accidentally no longer fail.” That’s persistence." - James Altucher

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