Just Managing: The Ironic Economy
The approach of a new year marks a good time to take stock of
the prevailing ideas driving the Internet Economy. Never before
has the power of ideas been so valuable in the economy, yet never
before has the value of these ideas seemed so hard to pin down.
Doing business in the Internet Economy brings to mind the concept
of irony - those factors that make it possible to do business are
the very ones that threaten to destroy what you have created. I've
heard the so-called new economy dubbed "The Internet Economy," "The
Entertainment Economy," "The Experience Economy" and more. This
year-end, my working title is "The Ironic Economy," because the
migration of matter to the Net has created a number of philosophies
that were thought to be fleeting. Here are a few of the truisms
that, ironically, have endured:
1. The biggest benefactors of new media ... are old media.
Current slump notwithstanding, the surge of the Internet has proved
to be the biggest blessing for the old-fashioned magazines that
get sent through that quaint postal system. This week Fast Company,
one of the oldest "new economy" magazines in a niche that includes
Business 2.0 and yours truly The Industry Standard,
was sold for $360 million, with another $150 million thrown into
the deal should it hit certain targets. And going forward, despite
a decline relative to last year, look for millions to be spent by
dot-coms on advertising in this year's Super Bowl.
2. The more technology provides, the more companies find themselves
competing over what technology cannot provide.
Many of the most spectacular failures of the past year were due
to bad managerial decisions. Sure, it's easy to attribute poor judgment
to companies that have tanked, but it's pretty hard not to gawk
at the outrageous death-wish spending of a company like Boo.com.
3. The newer the idea and the bolder the vision, the more experienced
and risk-averse you must be in order to make it work.
Any Nethead can come up with an idea that will change the world.
But the most influential and enduring Internet companies, such as
Amazon, Yahoo and eBay, have managed to deliver on
their promise by bringing in smart and seasoned talent for key spots.
4. The more open, democratic and accessible the Web, the greater
the need for editors, filters and info-czars.
Basically, discernment trumps access. It's far more interesting
to read a smart critique of a homepage than it is to read the actual
homepage. Most of the best and smartest features on the Web are
the result of smart intervention by people who make sense of the
Internet's information glut. Two great examples are TheStandard.com's
Media Grok and Jim Romenesko's MediaNews site. Both cull news about
the media for the benefit of folks in the trade.
5. Trust is the most important ingredient in making an Internet
startup work - and yet trust exists the least where it is discussed
I won't belie this point by saying more.
6. The more that work and family blend, the less you have of each.
This I know from experience. As one of the millions of free agents/independent
contractors who work at home, I know the greatest thing about working
at home is that I can see my kids at almost any time. Likewise,
the worst thing about working at home is that I can see my kids
at almost any time.
7. Temporary-ness creates permanence.
The more things change, the greater the opportunity to build something
enduring. One of the most successful types of new companies are
those that are lessors of temporary consultants to growing companies.
Marion McGovern has created a thriving San Francisco-based company
named M2, which matches up independent consultants with companies
seeking temporary high-level expertise. Her success is made possible
by the accelerated metabolism of the economy and is fomented by
the rich-gestation climate of the Internet world.
8. The dematerialization of matter hasn't materialized.
Despite the claims that physical goods are being threatened with
surrogate digital clones, the need for books or CDs or even plain-old
letters hasn't abated despite the easy availability of virtual versions.
Just about every physical thing that the Web has stripped away gets
replaced by something else.
Read or print the Intro
and Chapter 1.
Read the book reviews at Inc
Read the publisher's press
this book from Amazon.com.
the companies that Tom discusses in the book
Hear a recent lecture by Tom on the Startup Garden
Buy my book and I will send you a worksheet and list of local
and industry resources for your startup. Simply send me an email
with your zip code and type of company and I will email you the free kit. Thanks!
Managing – articles that Tom wrote for The Industry Standard and some
written for Inc., Fortune Small Business, Harvard Management Update, and other
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books and web sites about starting your own business.