June 15, 2005
wednesday in london
Still in London. Here all week.
This is what is currently on my radar.
1. English Cut. Got a call from Thomas over in the US. He had a really good visit both in New York and San Francisco. He’s now wrapping up the US trip in Chicago. We sold a lot of suits. Next visit we might add Houston to the list.
I’m down in London, trying to move the ready-to-wear conversation forward with possible suppliers. Maybe there’s a market for cheaper English Cut suits (say, $400 – 800 instead of $3000 – 4000). Maybe there isn’t. Same goes with English Cut shirts, ties, cufflinks etc. We’ll see.
2. Wines and spirits. I’m working on the Stormhoek brand, plus another 5 wine & spirit brands, which I’ll go public with later.
3. Thingamy software. Those of you at Reboot who got to meet Sig Rinde– he and I are working on something together.
4. The book proposal. That’s coming along nicely.
5. A commercial Hughtrain/blogging project, which I’ll unveil later.
OK, so what do these various projects have in common? Not much, except I started all of them for basically ZERO money [Tom and I got English Cut up n’ running for about $500. That kinda thing].
I’m starting to think– if your business plan needs a lot of starting capital, it’s probably pretty flawed.
"Hugh's Daily Cartoon" Newsletter.
A new cartoon sent out every weekday morning to your inbox [RSS version here.].
A wee chuckle to start your day off right etc.
Except if your business plan looks something like FedEx, which is pretty far from flawed but which probably needed a boatload of money to get off the ground.
Then again, if I were to start a company tomorrow, I would pick a business I could be in with a laptop, a telephone and not much else.
There’s a cool software company on the West Coast called Delicious Monster, they make a piece of software for the Mac that lets you organize your books. They’ve been raking in the awards and the cash since last fall, yet when it comes to office space, they use a local coffehouse. It’s two guys with a Powerbook each and that’s it. Wonderful.
Delicious Monster is in Seattle.
http://www.delicious-monster.com/
Here’s the Wired story about them and the coffee house:
http://www.wired.com/news/mac/0,2125,66276,00.html
They basically just have one product, and it has a pretty fanatical following even by Mac standards. But that’s not surprising when you consider the founders are from OmniGroup (actually one of the founders of that is a Delic founder), which for years has been one of the best small Mac-specific software outfits.
http://www.omnigroup.com/
Anyway, having spent some time in Seattle coffee joints, I can say that this development model gives a whole new meaning to the word “Agile.”
Oh yeah, and actually it’s more than just the two guys, but the team is small enough they can still all fit in the cafe.
Yep. That’s very cool.
I like businesses that can “travel light”. Suits my transient nature etc.
There’s always a market for cheaper versions of any brand. It is not, however, sustainable. To be cheaper you must sacrifice something; usually quality, finish or service, but ultimately, that, which is your core value…individuality/status. The client does not want to share his expensively won, bespoke product with anybody other than those of his choosing or peer group. Consider the example of Burberry. I rest my case.
Ouch — the comment on capital rings true Hugh but hurts a little too. I’ve spent a year working on a new business that’s moving forward very nicely.
My need for a little money (a few thousand dollars instead of a few hundred) is because I need technology for the web that doesn’t exist in the form I need it. Building it requires geek-time that I need to pay for.
Point is — sometimes invention requires investment. Especially when you’re inventing outside your own field. I guess I could learn to program and do it all myself but the cash is a shortcut.
Some ideas start by generating a few dollars. Others a few hundred thousand (with varying degrees of profitability). Mines in the latter category so relatively speaking the money I’m investing isn’t that significant. I
Steve, in a lot of cases you can sacrifice the bullshit and end up cheaper *and* better.
Not everywhere of course, but in a lot of things. The Delicious example: Sacrifice paranoia and cut your labor costs (work out of a coffee house, don’t pay for offices, get people to cut you slack on the paycheck in return for flexibility, etc.) — and watch productivity increase because your belief in your product is inspirational.
One of the intriguing things about the blog(vertising) phenomenon is that you just might be able to sacrifice traditional marketing, with all its associated costs, and get to Point B even faster. Whether you pass those savings on to your customers is another question. Seth Godin got a choice quote from the CEO of JetBlue on that subject, which you can read here:
http://sethgodin.typepad.com/seths_blog/2005/06/the_seduction_o.html
Many products and services are invented in the basement (Ideascape); however, marketing to people that don’t surf the net or read blogs leads many of us to plan “b”. What’s plan ‘b’? Call every mfr in the phone book.
One of my favourites for the cartoons.
But some business do needs lots of capital.
Like WebVan
Boo.com
Dr Koop.
Oh. Right.
Basically, if you need capital it is either for development time, or infrastructure. If it is development time, find a new model or a smaller starting point. (Sig I know has been noodling awy quitely at the software in his other life, so not burning up capital to stay alive.
If it is infrastructure, ask yourself what purpose it must serve. The only need for infrastructure is if you are starting a local business that serves a physical need, like a cafe or a laundrette. Otherwise someone in the developing world will do it cheaper, better and quicker.
Its an expression I often hear, and agree with. “Never be the first, and never be the last.”
But what about if your idea is for a cool new, mass market widget? And say that widget costs $100 to produce in, for instance, China. Is the market ready to “wait” while their order is built-to-order? If not then inventory must be purchased and that takes dough, sometimes alot of it. Hugh, you had to invest $$ in your t-shirt inventory. Where is the balance between keeping things as close to just-in-time as possible and fulfilling the demands of the market? IP-based products are a no brainer. Atoms-based things still make me scratch my head.
Well, my way of looking at capital is– it’s just one more commodity.
And commodities, including capital, can be outsourced.
Perhaps the title of the cartoon should be F.ART (Fine Art) explained!