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The Map of Innovation
This is the general idea that suffuses Kevin O'Connor's new book The Map of Innovation: Creating Something Out of Nothing. O'Connor might not be a household name, but he's started several businesses that have achieved recent notoriety: Flexplay, which makes DVDs that become unusable after a certain period of time, and DoubleClick, which needs no further introduction. This book synthesizes his experiences in conceiving a business idea, soliciting funding, and getting it off the ground. While we may dispute the utility of his business ideas, they have been largely successful. That means that he might have something valuable to say.
I've read a lot of books on entrepreneurship in my quest for self-employment. They're usually divided into two groups: those written prior to the Internet or only cursorily treat its affects and those created during the dot-com frenzy. The former are marginally useful since they offer some guidance on entrepreneurship even though their lack of technical considerations mitigates this usefulness. The latter are completely useless since they typically engage in strident hyperbole and grandiose pronouncements.
The Map of Innovation is different since it was written well after the dot-com hype had subsided. Even though the author built his major business, DoubleClick, during the IPO land grab, the book is remarkably free of the thinking that permeated that period. O'Connor's focus is to get a business started on fundamental principles like profitability, great employees, and broad vision. And that's exactly what a business book should target. If it seems obvious, O'Connor recognizes this: "I find that the best business books are obvious. But that isn't surprising. The fundamentals of what you have to do are so obvious that they almost always get overlooked."
The book is divided into four parts with an appendix containing DoubleClick's business plan: 1) coming up with ideas, 2) developing the best idea, 3) getting funding, and 4) hiring great staff. These, unsurprisingly, are the steps that he believes are vital to founding a successful company. Of these, I think that his idea generation chapter is the weakest one of the bunch. This isn't terribly important, though, since most people reading his book will probably have a few business ideas of their own or can come up with them readily.
My favorite part is dedicated to developing the best idea. It covers how determine the viability of your idea (how to vet it thoroughly) and how to present that idea in a business plan that will attract attention. O'Connor helpfully includes a basic outline for a business plan and then covers each item in considerable detail. I've read many books on constructing a business plan, yet I found his explanation to be the clearest and most straightforward one I've encountered.
The chapter on obtaining funding for your idea presents a series of solicitations starting with family and friends and ending with venture capital. O'Connor brushes off the problems with venture capitalists like dilution of ownership and the common occurrence of founder expulsion. He does offer some sage advice about how much money to seek and how that money should be spent. In light of his entrepreneurial history, it is unsurprising that he suggests such funding sources. His relations with venture capitalists were positive and he willingly withdrew from the corporate limelight.
Overall, the book is an excellent primer for anyone interested in creating a technology-oriented startup. It won't provide all of the information necessary for the would-be entrepreneur, but it's a good start. O'Connor tries to suggest that it would also be useful for new projects in an existing corporation but I don't buy it. The advice just doesn't apply as well. The only weak spot of the book is his Brainstorming Prioritization Technique, which is obviously a pet theory of his that he couldn't bear to pare down. It amounts to brainstorming and then picking only three to six items from the brainstorm. It is painfully obvious and an altogether common idea generation method and luckily is quickly read. The advice about venture capitalism is easily tempered by also checking out Arnold Kling's Under the Radar: Starting Your Net Business Without Venture Capital or Philip Greenspun's experience with venture capitalists.
"To be successful in the business world today, you absolutely have to incorporate some sort of technology."
Well, not necessarily to the level most would have you believe. While the exception may prove the rule, this savings and loan gets by on the bare minimum and succeeds in a highly competitive business. In short, it's the business process that matters most, not the technology behind it.
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If you want steady employment, read the book, because if you aren't a CEO or upper management you're expendable.
...it sounds like another internet shyster, who experiences oxygen debt from all the hot air, and starts believing their own hype.
You need creative people with ideas. There are two basic ways to sell a product.
1) Create a need and a product that satisfies it.
2) Solve an existing problem in a new/better way than before.
Buying computers solves neither.
Technology is only an advantage if it either lowers your cost of doing business or makes your people more productive. This might seem obvious, but for some unfathomable reason the basic wisdom of this tends to get ignored.
My company and my fiance's company are on different ends of the spectrum here. My company spends truly awsome amounts of money on technology development efforts, many of which (lately) come to absolutely nothing. Of those that actually make it into use, many won't recoup the money we spent developing them. This is a Bad Thing, especially since eventually upper management might realize we're a huge money pit and shitcan the lot of us.
My girlfriend's company, OTOH, won't spend money on tech to save their lives, even when it means they're losing money. For instance, they have a hard limit on their email inbox of about 500 megs. This is a problem since they're a publications company and pass around large files, so each person ends up spending about two hours a week managing their email -- they bill out at $135/hour, so just in her 20 person office (and there are several other offices scattered around) that's $280k lost each year in the interests of saving the couple grand a new disk array would cost.
The trouble, as far as I can tell, is that my division is run by a geek who is stuck on having the latest-and-greatest and her company is run by a short-sighted beancounter. Both are equally destructive to the bottom line in the end -- the geek can't say no to things that sound cool (tell me if this reminds you of anyone) and the beancounter can't see beyond the invoices on his desk.
Every year during my review, I just pray the words "slashdot.org" aren't mentioned.
Well, if you are running a front yard lemonade stand, then no. If you plan on doing business then you would want cash registers, even better, ones that interfaced to a database somewhere to help with tracking and inventory... Sure you could run a business with no technology, but what he is stating is that computer programs (read: financial and office suites) save lost time in writing ledgers, manual calculations or running to kinkos to make a fliers and other business propaganda. So you do not necessarily (sp?) need to have a rack mount server and a web presence, it would still be a good idea to have a pc with app's pertinent to your business
you can't have freedom for free
you won't get wise while the sleep is still in your eyes
no matter what your dream might be
Even though I'm in the finance business (and not in the computer technology industry), I feel the whole case for pumping up technology-related economic growth with better management techniques is overstated.
I don't think you can go wrong, business-wise, with a new technological concept that people or business can actually use. "Creating something out of nothing" means adding value, and value comes from utility.
I do feel that the current "can't patent concepts" ideology hampers conceptual innovation, since it's just easier and more profitable to replicate existing technologies' functionalities.
Last time I checked out Linux, X had a Start button. A large thread can be woven on how the Windows GUI concepts come from the Mac, or how that one comes from Xerox Something, but the very thought that they bothered enough to copy minor details of Windows' interface concepts is depressing. Of course, MS has done that quite a few times. In this whole conceptual innovation game, people who have actually changed the world (like the guy who came up with VisiCalc) are more often than not deprived from the immense wealth growth their idea created.
Of course, we don't want to have semi-old concepts remain half-baked while an incessant quest for the new continues. How do we solve this research incentive problem?
Man, I don't have the slightest idea. *sigh*
And I agree with you about the merit of O'Connor's business ventures. However, they've been profitable and generally successful.
I see his book as a helpful aid to thinking. Read about hiring good people or developing a business plan and then think about what I could do differently or better.
The people who are truly successful and innovative probably aren't interested right now in writing books about how they achieved their success. They're too busy to give advice in print. I bet that we'll see a raft of books from such people once they start retiring or settling down. That's what Sam Walton did. In the meantime, I'll take what I can get.