Wednesday, September 26, 2012

Surviving Little Entrepreneurism

In the October 2012 issue of Vanity Fair, Randall Stross writes about Silicon Valley’s Y Combinator, describing events in the spring and summer of 2011 when 2,000 teams competed to become one of 64 “companies” receiving between $11,000 and $20,000 to launch their “business.”

One team highlighted by Stross was made up of three 24-year-olds, recent college grads who pitched an idea for a business that would send “past memories to your in-box.”  Encouraged to “pivot the idea”--the latest phrase for “that stinks, try again”—they then hit upon an idea to create a business that would “organize and rank your Facebook content, allowing you to easily create a printed photo book.”  Yep.  These three would-be entrepreneurs told the Y.C. partners that they “believe in the power of memory, nostalgia,” without, one presumes, having had time to accumulate much of either.  When asked how this idea will “expand” they said they’ll begin building memory books around personal calendars, Foursquare check-ins and tweets.

Now--hold onto your hats--this was one of the teams the Y.C. Partners really liked, so much so that they were willing to fund their “business” (however it came to rest on its pivot) by investing $20,000 in return for 7% of their newly formed “company.”

Welcome to the world of Little Entrepreneurism.

Wednesday, September 5, 2012

Criminal Entrepreneurs

In 1817 a serious robbery using false keys was carried out at the busy Portsmouth dockyard, home to the Royal Navy.  In response, the government offered a reward to anyone who could design a lock that could not be picked.  The next year a local ironmonger by the name of Jeremiah Chubb patented a mechanism that rendered a lock useless if it detected anything other than its own keys.  This encouraged Jeremiah and his brother, Charles, to found what would become one of the world’s great security companies.  It also led them to diversify into a number of other lines, including designing the world’s first burglar and fire-resistant safe, advertised in 1838 as being able to “repel the force and ingenuity of the most skillful burglar.”

This was a serious claim, because like all good entrepreneurs, crooks and criminals are quick to adopt the newest technology and the latest form of organization in pursuit of their ignoble visions.  This makes criminal entrepreneurs a moving target, just like any worthy competitor.