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Should we normalize ephemeral businesses?

anu.substack.com

41–50 of 123 posts

Re: Should we normalize ephemeral businesses?

#41
post #31

Earlier quoted context omitted.

> 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.

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?

> 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.

Re: Should we normalize ephemeral businesses?

#42

Earlier quoted context omitted.

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, fi…

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.

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

Re: Should we normalize ephemeral businesses?

#43
post #39

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…

> I wonder if that’d go differently today? I hope so.

Well, it would put said executive out of a job, so probably not.

Re: Should we normalize ephemeral businesses?

#44

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…

> 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.

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.

Re: Should we normalize ephemeral businesses?

#45

Earlier quoted context omitted.

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.

Looks like r/sweatystartup, A hub for entrepreneurs of regular old fashioned businesses, is more active.

This is super fascinating, thanks. Especially threads like the tankless water heater cleaning guy.

Re: Should we normalize ephemeral businesses?

#46
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.

Re: Should we normalize ephemeral businesses?

#47
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.

Re: Should we normalize ephemeral businesses?

#48
post #23
post #17

Earlier quoted context omitted.

> 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 mil…

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…

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.

Re: Should we normalize ephemeral businesses?

#49

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…

> 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.

Re: Should we normalize ephemeral businesses?

#50
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

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