About success and the difference between cultivation and production

Let's come up with an analogy, and then make fun of it well: imagine that you have just acquired a land allotment. What will you do? Mining or farming?

If you are engaged in farming, you will first need to purchase seeds, and then work the whole season to make a profit. And every year you will dig ( literally) most of the profit came back to the land, salaries and mortgage payments. You will be wise to handle the soil so that it continues to give you a crop year after year. If you are successful and do everything right, then you will harvest, sales will grow and, in the end, earn a decent life. But every year, no matter how rich you are, you will return to the beginning: to bend your back while working on the ground. When you finally retire, if you did everything right, the soil will be just as good as when you buy, and your farm will live on.

However, you can do mining. You will need some money to pay for equipment rental and hire people who will work in the mine. And then: bam, profit! You make money. You tear a huge hole in the ground and pull out all the metal that is there. Work is proceeding at maximum speed: there is nothing to worry about, nothing to save for the future. You earn a lot of money, the land is depleted, and you move on, leaving behind an unsuitable crater.



At this point, you probably already realized that I was not really talking about farming or mining. This is just a metaphor for managing a software company. You can regard the creation of a company as a step towards the production of good software or asstep to sell stocks, hit the jackpot and move on .

Perhaps it is obvious that one of the approaches I respect more. In fact, I would say that the big problem for our industry is that mining is so much praised. Around us constantly stories about “Look, Bob Smith successfully sold the company two years after its founding, and now he is a basillionaire!” And most importantly, if you want to attract money from the outside, then you usually just need to be focused on production, because few investors are interested in partnership with someone who is not going to sell the company and just wants to produce good products and sell them for fair the price. Usually firstwhat the investor will ask you is: "How are you going to get out of business?"

The problem with mining in our industry is that this approach does not work. It leads to the creation of crooked, useless companies.

Founders and business angels are usually not particularly concerned about what will happen to the companies they created after the sale. Because the money has already been received and everything went further. No one will reproach that the company you founded was covered after your departure. In fact, again, for this they almost give a medal: “Bob Smith founded the Loser .com, sold for $ 46 million and dumped before everything was covered! Genius!"

And even if one of the “mining” companies is bent to an IPO or resale, then this is not a disaster for the founders - their steep salaries were taken from investors' money, which means the founder can simply do something else and attract more funds from the outside. Business angels, of course, would prefer each business to be successful, but they deliberately play the lottery. All they need is for a small percentage of the companies in which they invested to grow into something huge, and then they will more than return all that is invested. Business angels are considered geniuses because no one ever talks about all those companies that have covered themselves. And therefore, such investors do not have a problem finding a large number of people for joint investment. Imagine, for example, a person with a lot of Amazon stocks. He is a billionaire. And so he wants to invest in a new adventure. Will you invest in this adventure with him? Correct answer -You do not have enough information to make a decision . How many companies, of those in which he invested, have covered? Do you have reason to believe that he really knew about Amazon’s future success, or was he just lucky a lot?

Remember, Fortune magazine does not write articles about all those who invested in ePizzaOnline and lost all their money. You only read about those who won the lottery. They are spoken of everywhere.

This is a fundamental problem: we blindly follow those who won the lottery, and we think that we can also win if we act in the same way. But, basically, lotteries create a large number of losers in a small way. About these do not write in magazines, but most of them.

Often we naively believe that if there is an established system (stock market, venture financing system, selling software disks in stores, Microsoft Windows), then it benefits everyone, otherwise it would not exist. This is simply not true. It is only necessary that for a certain number of people all this bring a lot of money, and publicly bring. In this situation, the system will be supported. Even if most people lose a little because of its existence.

In mining-oriented companies, charismatic freaking founders and their investors can make a lot of money. But the workers, customers and secondary investors are likely to have, because such companies and their products usually suck.

If you are building a company just to look great at one particular moment - on the day you enter the stock exchange - then you are not thinking about the future. You do not (back to the metaphor) care about the soil, do not make sure that your cattle is healthy and happy, and you do not do all the rest. You only think about looking as if in the future you will have good sales.

The stock market itself provokes this behavior: the potential growth of your sales is important for the market , not the current volume of your sales, because the point of buying shares is to sell them to another at a higher price later.

I want to focus on this: imagine that a successful company has an annual profit of, say, four million dollars a year. Year after year, four million. Great, huh? I mean, I would be happy to own such a company. But this company is terrible in terms of investing . Its market value will be approximately the same all the time, because there is no annual increase in profits. This means that there will be no point in buying shares at a price higher than now. You can buy stocks for $ 100, but they will continue to cost $ 100, and therefore this is a bad investment for you. (Obviously, I’m greatly simplifying everything here. At the very least, a company that demonstrates stability will rise in price over time. But, I think, you get the point.)

What upsets me is the number of people who want to mine who come to me and say: “I don’t know anything about the programs, but I see gold in those hills and therefore I want to found a company and earn my million dollars! "I have an idea and all that, just give me that magic spell that you used to get rich, and I'll do it all."

It doesn’t work like that. Your idea sucks. No, I do not call you a fool - my ideas also suck. All ideas suck because they are just ideas . They are worthless.

I succeeded because I worked to bring the idea to life. Many. All life. At the age of 12 I learned to program and since then I have been programming at every opportunity. It took me eighteen years to become a millionaire . I didn’t have a brilliant idea. I just continued to work, hating what I had done before, and trying to do better next time.

The idea is worthless. Try to come up with an idea that is worth something on its own. "I would like to come up with a web browser in due time." Bullshit. A web browser was invented at least twenty years (in 1968) before it was programmed on a NeXTstep computer. The product that could be used led to a revolution on the Internet, not an idea.

Velcro? This idea is useless if you cannot make them. Sticky notes? They were generally created thanks to a fluke by the person who worked in 3M to obtain strong- glue . This man spent years researching and working in the chemical industry. He didn’t wake up one day with the thought: “I think I should come up with sticky notes for notes!”, And then he attracted venture capital and hired several guys to do everything.

What about the Delicious Library (the product that the author is working on - approx. Translator )? We did not come up with the idea of ​​creating disk directories. But Mike Matas (Mike Matas) made the program beautiful and simple and now we own this market. I of courseI came up with the idea of ​​scanning barcodes using a webcam, but this idea would not have cost anything if I hadn't programmed it . It took almost a year to implement. But what about the idea? Yes, I came up with it once while taking a shower. Trifle.

The people who really change the world are farmers. Steve Jobs is constantly working on what his company produces. Every minute of every day. He lives, dreams and breathes all this. He is fixated, insane and scary, but he is trying to create something. He did not say once: “Hey, here is the idea: a smartphone! Bam! Go do it. And while I’ll drive into the sauna. ” This does not happen. God is in the details. In implementation.

The most delightful in attending the conference " Technology, Entertainment, Design"there was a realization that all the people I worship are farmers. Doctors and DNA researchers, dancers and chocolate makers, oceanographers and cosmologists, investors - they all have one thing in common: they are obsessed. They work on what they love, in literally all the time. You won’t be able to talk to them without talking about the object of their passion. The

secret to success, it turns out, is very simple: work hard, appreciate what you create, not the fame or money you get. And that's all you will succeed

Translator's note:
Translator may not To share my opinion about Steve Jobs, Windows, MacOS and other people and products mentioned in the article, please take this into account when evaluating the translation and the personality of the translator.