Business Design!

In part, this blog is an attempt to understand the internet age in a business context…or the business age in the internet context. My hope is to design a business, not plan one.

Lots of companies (and personalities) are using social media as lukewarm promotional tools. Some are experimenting with “crowd sourcing” and other ways of interacting with customers. But all of the popular efforts are largely retroactive. That is, they are established companies trying to figure out how to engage their customer base. What happens if the company is started this way? My reasoning for starting a company live and on-line is twofold.

First, I want to test a new model for business development: the DIY company. Today we see a huge resurgence in the popularity of DIY. I say resurgence because back in the day, you couldn’t just order stuff of the internet, or even get it at the local super store down the street. You had to make it yourself or find someone to do it for you.

Technology has been a boon for industry in terms of driving down prices and increasing color choices, but I think that has really alienated us from the all of the goods we interact with on a daily basis. Milk comes from cartons and not cows right? However, technology has turned a corner and become so cheap and so sophisticated that the individual (as opposed to the corporation) can now take direct advantage of the benefits. I say "DIY company," because technology makes it possible for one person (in this case me) to have the resources of a an entire traditional organization. 

While people in the US are undoubtedly losing jobs to globalization, I think focusing on that is unproductive because it doesn’t move towards a solution. I think the world (and business) is shifting towards localization. In the future, it won’t make sense to ship goods around the world because they can be made so cheaply and easily right where they are needed. I also think as resources become more scarce (and hence expensive) people will remember why high-quality goods make sense. They last, they can be repaired, we know the people who made them, we know who is accountable, and quality products are simply a pleasure to use because they function splendidly.   

I propose an experiment to test my hypothesis about local, micro-manufacturing. Just a decade ago, you had to have the power of industry behind you to start a company. Even the simple task of reaching customers required millions of dollars in marketing and advertising. Want to offer them a manufactured product? Tack on a few million more to start a factory and buy the machines you need to make your product. Don’t forget the staff of engineers  that possess the critical knowledge you need to design the product. Today, all you need is an internet connection, a CNC machine, and 1200 square feet of space.

Second, this whole idea of “entrepreneurship” is shrouded in mystery. In business school I sat through plenty of lectures from some stunningly smart people who started their own successful companies. I was especially excited when one of them said, “Today, I’m going to tell you exactly what it takes to start a company and how I did it.” Holy smokes! That is some serious intel right? Well, let me sum up his description (and every other description you will hear): I had an idea, got some people together, wrote a business plan, maxed out our credit cards, designed/engineered our offering, got funded, made capital investments, did up some marketing, created some advertising, and here we are! Oh, and I forgot, “it’s really hard.”

Talk about a letdown. I don’t know what I expected to hear, but something more than chapter headings would have been informative. The funny thing is, this is all anyone can tell you about starting a business. I think that when these business people look back, it's easy to forget the little (but critically relevant) things that happened throughout the process. I hope this experiment turns into just that: a day-by-day record (okay maybe week by week) and firsthand account of starting a real product company in 2011.