Category: Growth Series

Coin showing ancient roman general and pirate

The Pirate’s Advantage

March 5, 2021 /

I’ve a friend who is in the early stages of developing an innovative app.  Recently, he was disheartened when he was looking in the app store and discovered that someone had already built it.

I’ve been there several times.  You think you’ve identified an opportunity or unexploited idea and get really excited.  And then a couple weeks into working on it you stumble across someone who has already done it.  Fuck!

In our current age, it’s incredibly difficult to find unexploited opportunities.  

There are massive incentives to create solutions and few barriers to do so.  Products continuously spawn in this fertile environment- all the way down into the crevices of every microscopic niche and razor thin vertical.

First mover advantage is not going to happen for most of us.

But this isn’t bad, because there are some real advantages to being a Johnny-come-lately.  Not only should you not be dejected by our high competition environment, you should embrace it.  

Because it’s ripe for pirates.

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Michelangelos David

Optimizing for Profit

February 26, 2021 /

In the book “Built to Sell” John Warrillow explains how approaching your business as if you’re going to sell it will help you to maximize the value of it- regardless of whether you actually intend to sell the business.

Pretend for a moment that you were going to try and sell your business within the next quarter.  What would you change?

It’s like getting divorced- all of a sudden you’re on a diet, in the gym, and doing all sorts of stuff that would have kept you from getting divorced.

Pretty funny.

If you were going to sell, it’s a safe bet that you would clean house:

  • Updating systems
  • Updating SOPs
  • Reevaluating your employees, costs, customers
  • And seeing what changes you could make to improve your value

All of this in an effort to appear more valuable… really to be more valuable to a buyer.

The thing is:

The opportunity to be more valuable was always there.

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Alice Through the Looking Glass

The Profit Window

December 31, 2020 /

Growth.

Most business owners are obsessed with it.  

Early stage entrepreneurs focus on top line revenue.  As they gain experience some of them shift priority to profit.  As they gain more experience, some veterans shift back to revenue (or back and forth.)

Many entrepreneurs focus on vanity metrics like headcount.

For the past five years, I’ve managed a small team and been stuck under the $300,000 revenue ceiling.  The entire time I’ve worked diligently to grow the company and have continually invested in sales and marketing.

Superficially, it doesn’t seem like much has changed.  We certainly haven’t grown from the perspective of revenue or number of employees.

But we’re actually much more profitable than we were five years ago. 

We’re more productive at creating value.

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Salvatora Rosa Fortuna

Profit Isn’t the Bottom Line

December 10, 2020 /

Profit isn’t the difference between revenue and costs.  It’s not a line item on an income statement that is black or red.

Profit is the capture of excess productivity in value creation.

There’s a functional difference between the ideas.

The first is a measurement which can be gamed.  The second speaks to the underlying forces that drive a business.  

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