Friday, January 2, 2015

Recapping 2014, Resolving 2015

This was my seventh year blogging, something about which I might be prouder if the pay were better.

The single best-read post for 2014 was the very first of the "Barnyard of Entrepreneurs" series, Predicting the Futurefollowed by the fifth (A Lesson in Business History). Upon re-read, Future came off as a little crankier than I had intended, but History was more in the spirit of poking fun at how short our industrial and commercial memories have become.  In no event did I even begin to approach the hilarious and creative evil of David Sedaris in his Squirrel Seeks Chipmunk, still one of my favorite books of the new millennium.

The third best-read post of 2014 was the sixth in the Barnyard series, Failure is Success.  Failure, which Mankind concluded sometime back in the Stone Age could be a profitable learning experience, has morphed under Big Entrepreneurship to be a badge of honor--provided you eventually attain success.  Stories proclaiming the value of failure by repeated failures are less easy to find. 
By the way, when I wrote the term “Big Entrepreneurship”—hardly earth-shattering, I know—I Googled it and had not a single hit.  So I stuck it in a post here, like planting a flag on a new continent.  (History suggests that if you want to claim territory, an army is better than a flag.) It’s a concept I have developed much more fully in my working (and still alleged) book on the American entrepreneurial experience, now entering its third (or possibly fourth) year of research and writing.  (Though the mills of God grind slowly, the poet wrote, they do grind.) I am hoping in the meantime that Pat Riley does not add it to “Three-Peat” in his stable of dubious trademarks.

On of my new reading finds in 2014 was PandoDaily’s “Startups Anonymous."  There is more melancholy about Big Entrepreneurship per square inch of copy in this feature than almost anywhere on the Web.  This post says, for example:
It’s really, really discouraging to get up day-after-day trying to figure out how the hell you pay your team enough to keep the product from falling apart, while fighting tooth and nail to keep your family from falling apart at the same time. And after all the years of trying, marginally succeeding, failing, trying again, and again, and again, I’m pretty much unemployable at any other kind of work than what we’re doing – so there’s not any reasonable option I can see that would be any more stable anyway.
If you read on you’ll find his company has generated a whopping $200K in revenue, probably something akin to our entrepreneur’s base pay before bonus had he stayed in school and/or taken a real job doing something productive.  When you are miserable, when company revenue equals the opportunity cost of lost personal income, and when you have no marketable skills or good career options—you have been caught in the gears of Big Entrepreneurship.  It’s all about survival of the fittest, a concept we adore in our capitalist society until we discover whom the unfittest really are.
And, of course, there’s this whole issue of when and even if you get to call yourself an entrepreneur.  In my second post on Big Entrepreneurship I argued that personal characteristics are largely irrelevant; to be called an entrepreneur, a person must demonstrate enough impact in the market to break a traditional business flow, an idea that simply channels economist Joseph Schumpeter.   If anything, Schumpeter himself sets the bar exceeding low (in his example of the manufacture of a Deerfoot sausage) which to me is simply stealing market share with a substitute product and hardly entrepreneurial at all.  But Big Entrepreneurship muddles small wins with innovation of lasting value, conflating shopping apps with electric cars.  This confusion crops up in the endless articles about really bright kids who are just tossing away futures of genuine impact for what seems an easy path to riches, aided and abetted by really bright investors who cannot possibly have the entrepreneurs’ best interests at heart.  Try Marwan Roushdy, who went from connecting people and emergency hospitals to yet another photo-sharing app, backed by all the usual suspects.  (See Swipe and the Silicon Valley Idea Machine here.)
These stories are a dime-a-dozen, I’m afraid, in the Age of Big Entrepreneurship.
Other Posts
The other posts of 2014 that did well were The Education of a (Diminishing) Baby BoomerThe Outsiders: The One Thing CEOs Need to Do Welland any post that included travel and picture-taking, like:












and the last official post of 2014: 



I suspect there were a few too many gravestones in this year's crop of posts, but the working model for my book research continues to be that I learn most when I spend half my time with living entrepreneurs and half with dead ones.  You can meet swarms of living entrepreneurs at every cocktail party in this grand old land, but you need to visit a graveyard or two to meet face-to-face with the dead ones.
The 2014 post that got the most likes but was hardly the best read, When the Two Richest Americans (Ever) Met, was yet another indication that the mysteries of blog readership remain mysteries to me.  Meanwhile, my single best-read post of all-time, which racked up 1,000 hits in December 2014 alone six years after I posted it is Historical Postcards and the Battle of New Orleans.  Go figure.


Death and Tipping Points

In a world where clickbait titles announce that everything is stunning (a favorite adjective of Wired, I’ve noticed) and pivoting paradigms are being constantly disrupted, I pay particular attention to death, doom and destruction.  For example, a prominent literary agent declared this year that “if Amazon is not stopped, we are facing the end of literary culture in America.”  Literary culture.  One of my LinkedIn "Influencer" articles (a platform in equal parts provocative, obtrusive and unedited), told us that "The world is coming to an end. . .Well, hopefully not in the apocalyptic sense disaster movies are so fond of portraying, but the corporate world and the way it innovates is doomed, if not already in its death throes."  In 2014 I also read that casual dining is dying, commuters will soon become extinct, the social media manager is (almost) dead, Facebook is cooked, the college degree is doomed and (of course) the Web is dying.  That last one, like the next recession, will keep being reported until it’s true.  And just this week I read in the Atlantic that "the new paradigm" (of which I'll spare you the details) "may finally destroy the very notion of 'art'."  (I'm hoping at least it doesn't die before we see the Goya exhibit at the MFA this weekend.)

To pause in the melodrama for a moment, I’m pretty sure 2014 was a tipping point in one very significant way:  For the first year ever, I'm sure that I read as many negative as positive articles about Silicon Valley.  The import of this increasingly negative press on America's Great White Hope is only, I think, that the Digital Revolution is maturing.  That means it’s taking on all the old trappings of conventional, traditional business: monopoly, consumer mistrust, theft, inequality, corporate tax dodges, sweat shops, insufferable white males, bad cafeteria food and the like.  In the specific case of digital innovation, too, we also have grave privacy concerns, endless hacking, the trolls of travesties like Gamergate, and the recent understanding that, in Schumpeter’s terms, if innovation is about making sausage, we might very well be the sausage.  Books like Nicholas Carr’s The Glass Cage suggest that we are willingly and happily relinquishing control to our machines.

But There's Hope

An especially hopeful idea to end 2014, however, was described in Adrian Wooldridge's "Going Physical" article in The Economist's recent "The World in 2015" edition.  Wooldridge believes that the most successful companies in Silicon Valley will increasingly be those that connect the virtual and physical worlds.  "The rise of intelligent devices," he writes, "will allow the Valley to rediscover its roots as an engineering centre."  That suggests a fundamental shift in the balance of power, and perhaps the decline and fall of Big Entrepreneurship.  "Social-media giants like Twitter and Facebook will look like old dowagers.  New giants will emerge at speed to displace them in the public imagination.  The great survivors from the Obama era will be Apple, which has always focused on making devices, and Google, which is moving swiftly into the new world."

Woldridge's conclusion will be music to the ears of every old Rooster in the barnyard:
Intelligent devices will provide the Valley with a new-found seriousness.  Social media companies essentially dealt with virtual candy-floss: nice to have but, for the most part, hardly essential.  The new generation of entrepreneurs will deal in devices that can save lives.
These encouraging words suggest that American entrepreneurs will, in Silicon Valley's next iteration, retake their own narrative.

Some Other Stuff From 2014

One of my favorite readings of the year was The Motley Fool’s 122 Things Everyone Should Know About Investing and the Economy.  Perhaps the best of the 122 is J. Paul Getty’s keys to success: 1. Rise early  2. Work hard.  3. Strike oil.  Of course, what he meant as a joke has become, under Big Entrepreneurship, a formal career path.

I have learned in a world of endless choice that our information filters must continually evolve.  Two I adopted in 2014 were the New York Times’ “What We’re Reading” (always fantastic articles) and Tyler Cowen’s terrific Marginal Revolution.  The best book I read in 2014 was Thomas Kuhn's The Structure of Scientific Revolutions, not easy but truly worthwhile.  But the single best thing I read in 2014, which had almost nothing to do with entrepreneurship or any of my research, was John McPhee’s essay "In Search of Marvin Gardens."  I became a fan of McPhee’s when friends gave me Oranges, an entire book about, well, oranges.  It was fantastic.  McPhee's essay on Monopoly intertwines his own obsessive playing--"Go.  I roll the dice--a six and two.  Through the air I move my token, to Vermont Avenue, where dog packs range"--with a tour of the old Atlantic City, pointing out the squalor of the landscape: "The dogs are roaming (some are limping) through ruins, rubble, fire damage, open garbage."  It is an entirely new way to see an entirely traditional setting.  Readers also learn that Marvin Gardens is the one property which is not actually in Atlantic City (who knew!?) but in Margate, New Jersey.  In fact, (correctly spelled)  "Marven" Gardens was built in 1920 as "a citadel and sanctuary of the middle class."  

I mention this essay for the simple reason that it contains a line that captures how every entrepreneur should feel on his very best day: "My cash position may be low," McPhee recalled during one of his games, "but I feel like a rocket in an underground silo."

That is the definition of potential energy.

So, let me second that:  No matter your own cash position this year, or how far you might be from striking oil, may you awake each day in 2015, work hard (as J. Paul Getty prescribes), but never feel anything less than like a rocket in an underground silo.