For the past three years, I have been working (nights and weekends) on a new company with a colleague. We have spent well into six figures, not accounting for our time. "Incubating" and "sweat equity" are the terms now in vogue. This is a new business in the publishing space—a niche market easily in the hundreds of millions, (or, as much as $10 billion, according to some estimates).
[See 20 rules for real radicals.]
The potential is so great that instead of doing a raw startup, we thought we would approach media companies with a compelling offer: They can have the business for a very modest amount of cash, plus an ongoing royalty on sales. This is quite different from the "normal" method of starting a business, but I suspected the recession might have instilled a new attitude in larger businesses. (For a more complete review of this attitude, read Seth Godin.)
So, we started contacting publishers and those in charge of “new business development.” What a bunch of protect-my-butt individuals. No wonder job creation is almost nonexistent, when the people in charge of developing new business are being so cautious that they're completely paralyzed. One publisher, for example, was quoted in the press as having said he was less concerned with besting his competitors, than in finding new pathways to the future. Perfect. Our startup is a pathway to the future.
[See temptations to fight at work.]
I have E-mailed him. Called. Tried to get on his calendar for 15 minutes. He won’t even give me the courtesy of returning my phone call.
Back up at 40,000 feet, it is interesting to see that, in general, the larger the company, the more rooted it is in the past. There are simply too many institutional barriers to overcome to bring in a new idea, even if the idea is potentially huge. Talk is cheap and easy.
Meanwhile, unemployment is at 10.2 percent and people who have never actually created jobs are talking about the new industries of the future.
G. L. Hoffman is a serial entrepreneur and venture investor/operator/incubator/mentor. Two of his companies have traveled the entire success path from the garage to IPO. Currently, he is chairman of JobDig, which operates LinkUp, one of the fastest-growing job search engines. His blog can be found at WhatWouldDadSay.com.