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The Non-Business Plan
Attended a meetup event last night at which three projects at various stages of development presented. Names removed to protect the innocent - I want to encourage more open sharing, and that won’t happen if idiots like me air the dirty laundry. But let me talk about them in general.
One was clearly a business - it had identified a need, a customer, and was building a solution to fit that intersection. A hammer built with the nail in mind.
Two were not businesses, though both have potential to be. They were projects, free services that had a following of users.
The people working on them like their projects, and the intrinsic “fun” factor is a big part of the value. And the capital costs of maintaining them are insanely low, such that the service can be sustained even without a business model, as long as the labor associated with it can be financed.
One project is sustainable as-is, on account of the inventor having a day job. Any income from the service itself would be icing on the cake from his point of view. He gets exposure, better job offers, and of course there is always the potential down the road of building a business out of it. But most importantly for him, this is fun.
The other project is not sustainable as-is, because it is a full-time effort. As such, their The goal is to generate income for the founders - somehow. It appears that “Plan A” was what I have previously called a spec script. But they are also working on ways of generating current income, to make the leap from a non-business to a business. They’re kind of starting on their back foot, because they’ve built their technology and service, and now are looking for needs they can fill with it for which people will pay. Not insurmountable, though.
There is an interesting economic effect in here of these projects requiring so little effort to build and OOP to maintain, that a service of decent scale can persist without a significant business model backing it up. I have to say that I didn’t have a full appreciation of this effect before last night. We may be seeing the rise of the hobbyist-entrepreneur?
Sounds like a fun path, this non-business model. And a trend well-worth watching.
March 5th, 2006 at 8:52 pm
[…] Lisa Williams liveblogged the Boston Startup Meetup event (I discussed it too, though afterwards) and had the following analogy that I think is really on-target as regards the “acquisition” business plan that seems so in vogue these days: […]
March 10th, 2006 at 2:20 pm
[…] I heard this quote come out of a founder’s mouth at Boston Startup Meetup event last month (previously discussed here). […]
March 11th, 2006 at 8:33 pm
[…] I posit that there is a place for the project without a business plan, but the underlying premise is along the lines of the following: […]
October 6th, 2006 at 3:14 pm
[…] This description also gets to the haze in the term great product. To me, a “great product” is one embraced by the customer (see above), so the definition gets back to the marketing (by which I do not mean promotion). There is no such thing in my mind as the great product without the marketing aspect, because the greatness is defined by the success in the market. (there is also the 5P factor, which I will try to address in the near future). That’s not to put down great projects that do not pretend to be businesses. Take Tourb.us and voo2do - both local projects that don’t seem to have moneymaking in mind, and as such are joys to their creators. Creators who have day jobs, because they recognize the difference between hobby and business. […]