From the Blog

Economic tarpits (and 5 ways to avoid them)

Mammoths are grazing, sabre-tooth cats are hunting. But the ground they walk on is warm and kinda sticky. Who will escape the tarpits of the 2009 economy? Here are factors that matter:

  • Sector. I like whatever is badly broken (healthcare, energy, education, healthcare again) or really numbing – I am talking beer, lottery tickets or anything released in the last ten years starring Nicolas Cage.
  • Size. Go small. Why? It means you can be profitable without laying off half your staff and eviscerating morale. You don’t need $50 million from VCs to launch a great business. Perhaps most importantly, medium-sized sales matter measurably to small companies. Whale hunting is fun, but small companies get to live like the good Norwegians – on a steady diet of herring and berries, with a salmon every now and then.
  • Pace of Iteration. Fast. The era of the one- to two-year planning horizon is over. Products need to iterate quarterly, monthly, weekly. Maybe even in an automated way hourly (see Amazon or Google). Launch, learn, re-launch, re-learn, repeat. Innovation = survival.
  • IT involvement. Little to none. We like IT. They’re smart, thoughtful, irreverent (prickly at times) and perform feats of massive ingenuity. We just don’t want to talk to them when selling our services. No one selling to business buyers does. IT has to understand and raise issues of our enemy, complexity. Modern, standards-based SaaS (and in our business, emerging standards from the likes of Microsoft and Google) keep IT at bay.
  • Relationships. Have them. Nurture them. Obsess over them. When times are great, you might sell to strangers. But when times are tough, the relationships you, your team and your brand already have matter more than anything else.

Better to be the bird flitting over the head of the sabre tooth cats than the cats themselves.

That’s my nickel.