Thursday, October 18, 2012




We book-writing types tend to think of ourselves as creative people – and artists at that - and, as such, set apart (and above) the crude brutality of routine business. True, typically, we earn less – frequently a lot less – but we console ourselves with the thought that we are doing something we love; and that we have creative freedom.

There is much validity to that viewpoint, and when I left business to write I certainly held such a view, but, over time, I have modified  such arrogance; or have had it hammered out of me though experience.

I still regard much of U.S. style unfettered capitalism as quite as crude, brutal, and mindless as indicated (and not particularly effective at improving the quality of life of the population as a whole), but I now believe creativity knows no boundaries, and I am huge fan of entrepreneurs, the entrepreneurial spirit, and innovation in general – especially when de-coupled from the notion that all that matters is the accumulation of wealth. True, most of us like money, and all of us need it to some extent; but fundamentally it is a false god when seen as the prime motivator. It is a tool in the tool-box of life; but that is all it is.

Really great people are driven by ideas, the pursuit of excellence and the desire to break new ground; and they are exciting both to know and to work with. And many are great fun into the bargain, because enthusiasm is infectious.

Chris Devore runs a Seattle start-up investment house – with his partner, Andy, called FOUNDERS-CO-OP and blogs at

On October 17 2012, he wrote a short, but brilliant, piece which sums up pretty much exactly what I feel as as it relates to software (which is his area of focus) but his observations have vastly wider application; and are incredibly exciting.

Best to read the whole piece, but here is an extract:

“To a newcomer, the economic flows -- or lack thereof -- in early-stage startups can seem completely upside-down. Founders barely get paid, mentors pitch in for free, everyone works like a dog and they all act delighted to be there.

What's going on here? There are good reasons for things being the way they are today, but they require a little explaining...

Over the past 10 years -- thanks to cloud infrastructure and open-source software -- the cost of technology innovation has collapsed. This, in turn, has radically recast the economics of early-stage innovation.

Skilled teams of maker-founders can now build and distribute world-class software with no outside financing required (at least until the business starts to scale). The financing event that used to mark the beginning of a startup's life -- raising a few million dollars in Series A venture -- is now a growth financing event that comes 12-18 months later (if at all).

Because there's so little financial capital at work in the system, early-stage innovation tends to attract people who don't rate money very highly on their hierarchy of needs. From my own experience, early-stage community members:

  • are fascinated by the power of technology to create positive change;
  • love to be in the flow of new ideas; 
  • seek to advance their own thinking by spending time with thoughtful and intellectually curious peers; 
  • self-identify as entrepreneurs and enjoy the company of others on a similar life journey; and/or
  • have accumulated business and life experience relevant to tech startups and enjoy sharing their lessons learned with a new generation of founders.”

Chris’s ending is so powerful it makes me want to stand up and cheer; and the man can write. 

“For me, the early-stage innovation community is the most beautiful, inspiring, intellectually stimulating, emotionally rich and welcoming pocket of modern culture I've ever found. But if Willie Sutton were still around he wouldn't be caught dead working at -- or selling to -- an early-stage startup.”




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