[HN Gopher] Should we normalize ephemeral businesses?
___________________________________________________________________
Should we normalize ephemeral businesses?
Author : anaayelist
Score : 44 points
Date : 2023-05-16 18:04 UTC (4 hours ago)
(HTM) web link (anu.substack.com)
(TXT) w3m dump (anu.substack.com)
| thebooktocome wrote:
| Edging every closer to Stross' vision in Accelerando.
| mlhpdx wrote:
| Around 2000 I was in Stanford's executive education program and
| the discussion at hand was a case study about a company that
| faced a disruption with a large cash reserve on hand. The
| question was what the leadership team should do, and the answers
| were all variations of "spend the money". Except one - a lone
| voice allowing that the company could return the funds to
| investors and call it a day.
|
| Pure heresy. Return the funds, allow investors to decide
| how/when/if to reinvest? Soundly rejected by the presenter and
| audience.
|
| I wonder if that'd go differently today? I hope so.
| nwiswell wrote:
| > I wonder if that'd go differently today? I hope so.
|
| Well, it would put said executive out of a job, so probably
| not.
| st3ve445678 wrote:
| Some businesses last for decades, some only for a few short
| years. The reasons are varied. Nothing that really needs to be
| normalized here. It is what it is, don't overthink it.
| Zetice wrote:
| Here's a link to the poem [0].
|
| It's an interesting thought, but I wonder if "poem" back in the
| before times just meant "blog post" before they had those words.
|
| [0] https://motivateus.com/stories/reason-season-lifetime.htm
| RajT88 wrote:
| If you get back down to basics, as business is an equitable
| arrangement where you offer to solve a problem, in exchange for
| making a profit in the process.
|
| At some point, the problem may no longer exist, or you may not be
| able to continue to make a profit. That's OK! You can pivot, or
| move on to another business.
|
| What I would love to see represented is some thinking around what
| should happen as a matter of best practice when you decide to
| fold the business. There's likely paying customers left behind -
| to use an extreme example, let's consider the case of artificial
| vision where people are left with implants that often no longer
| work, that nobody will remove:
|
| https://www.bbc.com/news/technology-60416058
|
| The right thing for customers of course would be to open source
| the technology so they can pursue other avenues. The friction
| with this idea is that, maintaining ownership of the IP might be
| valuable later (someone may want to buy it, some new opportunity
| to build on the tech may arise). It would be great if there was a
| government institution which would compensate such businesses for
| their tech to open source it.
| RobotToaster wrote:
| >It would be great if there was a government institution which
| would compensate such businesses for their tech to open source
| it.
|
| Wouldn't that just incentivise more negative behaviour from
| businesses, since investors would know should they go bust, the
| government will buy all their IP?
|
| It seems potentially more sensible to pass a law that the IP of
| any business that fails becomes public domain.
| carlosjobim wrote:
| > Wouldn't that just incentivise more negative behaviour from
| businesses, since investors would know should they go bust,
| the government will buy all their IP?
|
| All businesses who would use such a scheme would be started
| by friends of politicians and public servants, with the sole
| goal of getting this tax payer buy-out for worthless IP.
| RajT88 wrote:
| This sort of negativity you can use to shut down changing
| anything, about anything, in any system.
|
| It's not inappropriate, but it is important to just have it
| _inform_ the debate instead of _ruling_ the debate. Yes,
| there should be constraints put in place to limit the
| potential for abuse, and as well oversight to ensure that
| people are following those constraints appropriately.
|
| "But then the oversight program will be targeted!" I hear
| you say. Yes, yes it will. And sometimes by policy makers
| with undue interest in weakening oversight. Sometimes just
| infiltrated by monied interests who stand to benefit.
|
| None of that is a reason to do nothing.
| carlosjobim wrote:
| It's not negativity, it is realism. Wherever the
| government gets involved corruption ensues. It is a rule,
| not an exception. Abuse is not potential, it is
| guaranteed - due to the kind of people involved.
| Especially when business owners can benefit from
| corruption. Strict constraints to deter abuse are always
| put in place in these programs, and they are always
| completely inefficient and/or supervised by people who
| are in on the scheme.
|
| I don't see it as negativity to be against the worst
| imaginable solution to a problem. It doesn't mean I
| suggest doing nothing.
| RajT88 wrote:
| It is negativity.
|
| > Wherever the government gets involved corruption
| ensues. It is a rule, not an exception.
|
| This is true. If your requirement is to never implement
| some system which can be abused (even a little bit), you
| are against government in any form. If you're not
| advocating for no government and you're OK with a little
| bit of abuse, then it's an argument over scale.
|
| There will always be some abuse, but the key to any
| program or system is to minimize the potential for abuse.
| There's abuse in the US welfare system, but broadly the
| consensus among anyone but partisan pundits is that the
| good the system does far outweighs the abuse within the
| system.
|
| > Strict constraints to deter abuse are always put in
| place in these programs, and they are always completely
| inefficient and/or supervised by people who are in on the
| scheme.
|
| This is not true, and completely defeatist. If you think
| the US Government is hopelessly corrupted by vested
| interests - you have not spent time in a country with a
| hopelessly corrupt government.
|
| The US Government is mildly corrupt, not wildly corrupt:
|
| https://en.wikipedia.org/wiki/Corruption_Perceptions_Inde
| x
|
| > I don't see it as negativity to be against the worst
| imaginable solution to a problem.
|
| More negativity. I can think of far worse solutions than
| what I have suggested.
|
| If you're simply advocating for the private sector to
| solve the problem instead of the government getting
| involved, I am wondering where you live where the private
| sector left to its own devices doesn't rampantly pillage
| to its heart's content. I'd like to move there!
| carlosjobim wrote:
| There is a widespread false idea that there exist some
| kind of system in governance, but this has never existed.
| It is just humans in an eternal power struggle. Whenever
| the "system" or rules don't benefit the rulers, they are
| not valid. It's a system to the extent that it exists
| inside the heads of the people who believe in that
| system. And most of people have a warped idea of what
| that system even nominally is, because their idea of it
| is by how they've been told by parents, teachers and
| other uninformed. Almost nobody has actually sat down and
| read the laws, the acts, and other documents.
|
| Saying the government should solve this lost IP problem
| is like saying that God will fix it or the King will fix
| it. And the "government should solve it" argument is
| always a top comment on any HN thread, no matter what is
| the subject matter. Isn't something strange if we always
| have the same solution no matter the problem? What is the
| purpose of discussion if all problems present or future
| are already solved?
|
| I haven't mentioned the US government, I'm not from
| there. I'm from a place where corruption is rife within
| government on all levels, and in most private businesses
| - who of course work together with politicians and public
| servants for this goal. And that is a nation who is far
| less corrupt than the US in the corruption perception
| index - which doesn't really say anything about actual
| corruption, just what people responded in a form. The
| general population is ignorant and don't even understand
| what corruption is, they think getting illicit funds from
| the government to your business is just being smart.
|
| The private sector can only pillage if they have the help
| of government. Having the government buy obsolete IP is a
| recipe for more pillaging.
| c54 wrote:
| I could imagine something like the Consumer Product Safety
| Commission tasked with recovering and open sourcing IP from
| shut down companies with products in people's hands.
| kerkeslager wrote:
| Ephemerality is the only workable solution to mission drift in an
| organization.
|
| The vast majority of entrepreneurs don't set out to create
| surveillance capitalism[1] or enslave children[2], but over time
| the pressures of keeping the business alive and growing force you
| to make compromises. The compromises are small, but each one
| takes you farther and farther from your values. Eventually you
| end up doing things that are abhorrent to any normal person, but
| seem normal to you because they're not that different from the
| thing you did before. This happens with all kinds of
| organizations including nonprofits, churches, etc.
|
| One of the things I've observed in the success of organizations
| such as 12-step groups, is that they have principles which they
| can _and do_ "die" for--rules like "We would rather dissolve the
| group than do X". Groups in a 12-step program are autonomous--
| they follow certain principles (traditions) and _often_ groups
| die off rather than break tradition. Similarly, impermanence is a
| core _feature_ of Temporary Autonomous Zones (TAZs)[3] which
| allows it to avoid perversion of its ideals.
|
| I think ephemerality is a good idea for businesses, as I think
| it's a key step in the direction of making capitalism more
| ethical. Businesses which can't operate ethically _should fail_ ,
| and our society should have safety nets for dealing with that
| (and other reasons a business _should_ fail). But that 's such a
| fundamental shift in thinking about business. Half of HN seems to
| think that if a company is making money it must be because
| they're good, despite extraordinary evidence to the contrary so
| we have to keep letting those businesses do what they're doing,
| without any regulation. I'm not sure how we can get to a future
| where businesses behave ethically when the unethical businesses
| have successfully sold the idea that their success can only have
| been achieved ethically, as a rule of economics.
|
| [1] https://en.wikipedia.org/wiki/Surveillance_capitalism
|
| [2] https://www.theguardian.com/global-
| development/2021/feb/12/m...
|
| [3] https://en.wikipedia.org/wiki/Temporary_Autonomous_Zone
| calderwoodra wrote:
| This post (as well as the companion post) read like
| rationalizations for Clubhouse's failures (of which the author
| was an early employee).
|
| It's okay to fail - and in that sense, Clubhouse was a success.
| jeffreyrogers wrote:
| Starting a business is really challenging, as anyone who has
| tried it knows. Trying to make the finances work in something
| ephemeral is likely even more challenging. In any case, most
| businesses fail so ephemeral business is sort of the default
| unless you succeed.
|
| There are individual businessmen who ride different business
| waves (like getting into frozen yogurt a little over a decade
| ago). But the skill those people have is in marketing and raising
| money and that transfers pretty well to different business types.
| There's also a whole world of business outside of tech that most
| of HN is not familiar with, and many of those people do extremely
| well for themselves. They also tend to be less idealistic and
| more focused on the money, which probably helps with adapting the
| business over time and figuring out what product/service the
| market actually values.
| Swizec wrote:
| > There's also a whole world of business outside of tech that
| most of HN is not familiar with
|
| I once read that the most reliably money-making business in
| America is a car wash. Comes with a built-in monopoly because
| people will only drive so far to wash their car and reliably
| generates low 7 figures in sales. Plenty of repeat customers
| and low churn if you meet a quality bar.
|
| But who wants a 70% chance at being a millionaire, when there's
| 0.01% chance at being a billionaire on offer? We on HN know
| what we want. (numbers for thought experiment purposefully
| chosen to have a similar expected value)
| vkou wrote:
| > But who wants a 70% chance at being a millionaire, when
| there's 0.01% chance at being a billionaire on offer?
|
| Literally _anyone in the world_ will take the first deal.
| Swizec wrote:
| And yet here we all are on HN _not_ taking that deal
| playing pretend that any day now our lottery tickets will
| turn into billions :)
| machinawhite wrote:
| Who is "we all"?
| vkou wrote:
| The number of founders and #1-3 employees reading and
| posting on HN is dwarfed by the number of literally
| everyone else.
| faxmeyourcode wrote:
| One community focusing on this is r/sweatystartups - which
| often discusses how to start a pressure washing business, or
| how to scale their lawn care service.
| activatedgeek wrote:
| Looks like r/sweatystartup, A hub for entrepreneurs of
| regular old fashioned businesses, is more active.
| morkalork wrote:
| This is super fascinating, thanks. Especially threads
| like the tankless water heater cleaning guy.
| CalRobert wrote:
| I must admit I was relieved an automower saved me from
| hiring a lawn care company.
| bluGill wrote:
| Unfortunately things like car washes are zero sum games - if
| there already is one "in town" and you open a second all your
| business at best comes from what the other already had, and
| in the worst case it starts a price war and make far less.
|
| Sure I won't go to the next town for my car washes, but just
| on my short route to the office I pass 3, and I know of a
| couple more that would be an insignificant detour. I think
| this is pretty typical for most city dwellers. (not to
| mention I work from home most days)
| bombcar wrote:
| This is exactly it - and the car washes that "make the
| money" are more and more the ones attached to gas stations,
| where they have the latest robotic car ticklers.
|
| Some people (larger trucks, etc) might still pay to use the
| manual car wash, but the costs are very similar and most
| will just use the gas station one.
|
| It's like laundromats - there's a very defined market in an
| area for them, and if you supply that market you can do
| well, but if it's already supplied you're in for a world of
| hurt.
| jeffreyrogers wrote:
| Marketing can increase the size of the market. Making deals
| with other businesses can too (they pay a fixed monthly fee
| and get unlimited washes for all their cars, etc.). I used
| to wash my car myself but the automated car wash is so
| convenient I just go there instead. There's also a customer
| service aspect. I used to go to a more expensive car wash
| because the employees there were really friendly and at the
| other one they weren't.
|
| Then there's the business aspect of starting this sort of
| business: deciding on what location is best, whether it's
| even a good business to start, etc. This is one area where
| people who want to be tech entrepreneurs are handicapping
| themselves and people who just go into business to make
| money do better. Lots of people think, "I need to start an
| AI startup" or devops, or whatever, instead of asking what
| opportunity is best for _them_.
| bluGill wrote:
| To some extent marketing can help you, but for the most
| part car washes are a fixed game. Unless you are using
| marketing for a price war people who see your ads are
| likely to go to the other car wash anyway.
|
| Don't get me wrong, marketing is very important. However
| there is only so much you can grow the pie for many
| businesses no matter how much you do. There is also a
| limit to the number of people you can attract away from
| your competitors. (the limit is different depending on
| how you compare on price and quality of course)
| KingLancelot wrote:
| [dead]
| jjk166 wrote:
| The problem is the institutions that are okay with being
| ephemeral evaporate away when their job is done, leaving behind a
| salty brine of institutions that aren't. In any system where
| there is selective pressure, survival becomes incredibly selected
| for, often being prioritized over all else.
| tpmx wrote:
| There's nothing contradictive between being fine with short-term
| failures and celebrating long-term successes.
| larsrc wrote:
| That is so Silicon Valley. 30 years as the longest span? There
| are businesses here in Munich that have been around longer than
| the US has existed. They are not "investable", though, they just
| go about doing good solid products that people need.
| rufus_foreman wrote:
| >> There are businesses here in Munich that have been around
| longer than the US has existed.
|
| There are businesses here in the US that have been around
| longer than the US has existed.
| hgsgm wrote:
| Movies and theater productions are ephemeral businesses. As are
| popup stores.
| RajT88 wrote:
| Garage/Estate/Yard sales as well.
|
| Movie and Theater is sort of both ephemeral and not - there's
| theaters, production companies, theater troops, etc. which are
| more permanent, but assembling them into a project is like
| building a working city from ready-made components, and then
| disassembling it once you're done.
| saltcured wrote:
| Right, I was looking to see if anybody made this comment. It
| also seems common for real estate developers. See also "joint
| ventures" and other subsidiary structures of large companies
| which may encapsulate certain activities and their
| corresponding risks and liabilities.
| nologic01 wrote:
| No we shouldn't. In fact we should denormalize a lot of
| dysfunctional business models, the transactional, excessively
| financialised, dehumanised business that has become the norm.
|
| A business is group of people building things together. Its a
| family. Its a village. We dont want ephemeral families, we dont
| want ephemeral communities.
|
| What we have is not working (pun). The overall drift of the last
| decades has led to an ephemeral society, made us unhappy,
| insecure, unstable. We need to go back to more grounded forms.
| tenebrisalietum wrote:
| > A business is group of people building things together.
|
| Disagree. A business is an operation meant to make money for
| investors. Things that call themselves businesses and don't do
| that over a period of X are failing, as businesses, for the
| duration X.
|
| A business is an organization, and organizations don't have to
| be businesses, even if they share some of the same attributes
| such as concern for expenses, desire to gather extra resources
| to protect against uncertain events, etc.
|
| Some organizations that are businesses maybe shouldn't be
| businesses, but they'd be OK as organizations.
|
| Stable organizations would be great. The name for ones that
| stick around a long time is "institutions." They need stable
| physical places and surroundings, which is hard when land and
| real estate is considered an investment vehicle and the value
| is constantly increasing.
| nologic01 wrote:
| > A business is an operation meant to make money for
| investors.
|
| please stop repeating Friedmannite vacuities as if they are
| laws of nature. What exactly is a business is defined by
| contractual arrangements that have nothing inevitable about
| them. Nothing.
|
| Money did not exist before it was invented. Its a social
| construct and actually idiotically simple. "Investors" did
| not exist before the invention of the corporation and the
| countless legalities, contracts, incentives and behaviors
| that shape it.
|
| A business is fundamentally a group of (non-related) people
| building something together (a service, a product, something
| desirable by others). Obviously some quid-pro-quo is required
| for them to be incentivized. Everything else in how the
| business is structured is up for grabs. The employees can be
| owners. The business can be non-profit. The extent of
| liability of members varies. The expected lifespan may be
| "eternal" or "ephemeral". Etc.
|
| I think if/when we start looking at our organizational
| arrangements with a critical eye instead of being dazed and
| confused we'll enter a better period of social and economic
| development. The prime objective is to have as many people be
| as happy, as productive, as creative as possible, for the
| longest periods of their lives. We are very far from that.
| amflare wrote:
| Businesses, Families, and Villages are fundamentally different
| creations. Unless you are going with the "company town" idea of
| a business. A business has a many to one relationship in
| regards to effort and goals. A Village has a many to many
| relationship. And a Family has a one to many relationship
| (though admittedly, at a certain scale, villages and families
| becomes very similar, but I think that's because a family
| naturally grows into a village given enough time). If a
| business has a one/many to many relationship, then it would be
| aimless and probably be a terrible business (as such things are
| determined).
|
| There is a reason society has created these as distinct types
| of entity, because each has a strength that it serves and they
| are not interchangeable. So while I agree that ephemeral
| families and communities are not good, that doesn't impact the
| value of ephemeral businesses.
|
| For the record, I'm undecided on ephemeral businesses, but I
| think its a valid conversation to have and might yield
| interesting insights.
| ianburrell wrote:
| There are plenty of ephemeral communities that work. There are
| conferences, conventions, festivals, and sporting events. Lots
| of them are run by permanent organizations, but many are run by
| temporary organizations for each event.
|
| A good example is science fiction Worldcon where there is
| permanent org that does selection of place for each year and
| each con is run by local non-profit.
|
| A historical example was trading expeditions where each trip of
| sailing vessel was financed separately.
| sigstoat wrote:
| > A business is group of people building things together. Its a
| family. Its a village.
|
| you'll be happier when you stop looking for family at work.
| nologic01 wrote:
| I think we all will be happier if we stop treating the vast
| majority of our life as a monetary transaction. If you accept
| being a disposable cog, you become a disposable cog.
|
| "Family" is an exaggeration, but work as a meaningful,
| socially and emotionally enriching activity is not a luxury.
| Its what most people would be more comfortable with.
|
| There is nothing inevitable in the current shape of
| businesses. They are, ahem, ephemeral optimizations, based on
| very specific contractual arrangements.
| vkou wrote:
| I suspect that the parent poster will be happier when the
| entirety of their public life isn't a hop from one precarious
| perch to another.
|
| Why do you think social cohesion and mental health is in the
| dumps in the developed world?
| sigstoat wrote:
| > Why do you think social cohesion and mental health is in
| the dumps in the developed world?
|
| everyone being convinced that problems are monocausal, with
| their pet bullshit being the solution.
| Animats wrote:
| There are finite-life businesses. Venture capital funds are
| finite-life, usually about ten years. Then they return the
| profits to the investors. VC _firms_ , if successful, create new
| funds and have them overlap. Sometimes a VC firm just runs down,
| and the remaining funds eventually mature and are dissolved.
|
| Single-film production companies are finite-life investment
| vehicles. They put up the money to make a movie, and, after the
| movie has been released, pay off the investors and dissolve. But
| that's more of a financial construct than an operating company.
|
| A construction consortium is a true finite-life operating
| company. These are companies established to build some big
| project, and shut down when it's finished. The first big one was
| Six Companies, created to build Hoover Dam.
|
| So ephemeral businesses are already a normal concept.
| jrm4 wrote:
| It's funny how this is a weird or foreign idea to so many. I
| teach in IT, so I'm soaked in all the "entrepeneurship" stuff;
| but somewhere else here had it right. One way to think of a
| business is that it's simply a machine to solve a problem. It
| doesn't have to be a self-sustaining money maker.
|
| I'd go so far as to argue that generally, the former is probably
| better for the world.
|
| Anecdotally, this 100% describes _why_ I started a business. Like
| many people, I fantasized about the idea of "having a business"
| but didn't do anything at all serious toward that. For me, it
| wasn't until an opportunity arose that had not much to do with
| "making money" per se. Specifically, I'm close to people who
| tried to start a Black news channel, and the website was trash; I
| knew I could to a LOT better, and I thought the whole idea was
| good. The channel didn't work out, everyone had other jobs, and
| so I don't have much of a business anymore AND THATS FINE.
| b2c0412 wrote:
| Agree, "a business is simply a machine to solve a problem." The
| problem is when keeping the business alive as long as possible
| becomes the core problem to solve.
| walleeee wrote:
| it's a compelling idea imo, if one considers the many ills
| wrought by organizations which outlive their usefulness and turn
| to parasitism
|
| but we must also _heavily_ penalize hollow businesses, which
| exist mainly to funnel preexisting wealth to founders /employees
| before evaporating
|
| a similar concept could be fruitful in material technology as
| well, where ephemeral doesn't mean "obsolete in 2 years so we can
| sell you a new one", but rather "can be dis/reassembled into
| something else when one chooses, or, if disposed of, will
| biodegrade into ecologically benign constituents"
| ilyt wrote:
| > but rather "can be dis/reassembled into something else when
| one chooses,
|
| That doesn't happen often enough to matter. Not everyone
| is/want to be a maker. or would even bother even if it is
| simple
|
| > or, if disposed of, will biodegrade into ecologically benign
| constituents"
|
| That should already be a thing. Hell, add the utilization to
| product price that then can be paid to recycling company on
| utilization. That way products _actually_ cheap /easy to
| recycle would also be cheaper
| vasco wrote:
| > but we must also heavily penalize hollow businesses, which
| exist mainly to funnel preexisting wealth to founders/employees
| before evaporating
|
| What does this mean? Isn't all wealth that can be used to
| purchase goods or services "pre-existing" and by definition
| going to the owners of companies if they manage to make a
| profit? I might be missing something because it seems you just
| described all businesses so I wouldn't know who you're
| advocating to penalize or how we'd distinguish them from the
| businesses that aren't "hollow".
|
| I can come up with some scenarios that maybe you'd have a
| problem with, but it's not clear which ones, or why?
| pixodaros wrote:
| One of the names for this is 'control fraud' and its very
| common. To pick an exotic example, people in the United
| States create software companies to impress rich fools,
| borrow their money on promises that it will get really big,
| and pay themselves and their friends generous wages which
| they keep even if the company collapses. People who run this
| scam often spend money very fast (they call it a 'burn rate')
| to impress investors about how big they will be one day even
| if it hurts their ability to create a proffitable business
| within the next five to ten years! Foreigners and their wacky
| scams!
| walleeee wrote:
| on one side of the spectrum you have Theranos, all manner of
| predatory financial instruments, need I go on? while on the
| other extreme you have a cabbage in your garden, which we
| call a "primary producer" for good reason: it's a fully
| automated business which for a bit of tending will yield you
| dinner
|
| sure, we're surfing an energy gradient, all of us children of
| the sun's benevolent surfeit, wealth already exists, fine. is
| there a definitive, one-size-fits-all criterion here? no, but
| you get the picture
| dghlsakjg wrote:
| To be fair to theranos, there were very intelligent people
| trying to do something incredible and had an actual product
| they wanted to make. If they had been able to do accomplish
| even some of what Holmes claimed they could, they would
| have had a real impact.
|
| Unfortunately the business was run by a set of sociopaths
| supervised by a board of geriatrics with no experience in
| the industry.
| walleeee wrote:
| agreed, and this
|
| > the business was run by a set of sociopaths supervised
| by a board of geriatrics with no experience in the
| industry
|
| ...is far too often the case, so if one is gifted and
| fortunate enough to choose who one works for, one lesson
| might be: put serious effort and consideration into the
| decision
| b2c0412 wrote:
| "outlive their usefulness and turn to parasitism" or to become
| shell companies that keep promising a future or self-deluding
| that there will be one
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