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A question most entrepreneurs are asked when they start out is if their idea is disruptive enough. But this question is a bad one to ask, argues Safi Bahcall in Loonshots and he goes on to make the case that ideas and businesses evolve. “[A]s experienced entrepreneurs know, so many ideas and technologies now recognized as transformative began with practically no resemblance to the final product they grew into, nurtured by champions who never imagined their ultimate market. Early-stage projects in rapidly evolving markets behave like a leaf in a tornado. You wouldn’t put a lot of faith in guessing where that leaf might end up.
“It’s easy to point to technologies that disrupted a market in hindsight, once the leaf has landed. We know that the transistor launched the electronics age. We know that personal computers can empower individuals and replace mainframes or minicomputers. We know that Walmart grew astronomically, and competitors disappeared. We know that biotechnology produces important drugs. But what about when those ideas first took shape?...
“[C]ould Google, when it began, say that it had developed a disruptive innovation? Larry Page and Sergey Brin’s improved algorithm for prioritizing internet search results, PageRank, was incrementally more helpful to users than results from the many other existing search engines. It was a ‘sustaining’ innovation, by the definitions above.
“When Sam Walton opened stores in rural areas, far from big cities, was he thinking it might be a strategic, disruptive innovation?
“‘Man, I was all set to become a big-city department store owner,’ he wrote about opening his first store. He was looking at St. Louis. ‘That’s when Helen spoke up and laid down the law.’ His wife announced, ‘I’ll go with you any place you want so long as you don’t ask me to live in a big city. Ten thousand people is enough for me.’ He ended up in Bentonville, Arkansas, population: 3,000, in part because ‘I wanted to get closer to good quail hunting, and with Oklahoma, Kansas, Arkansas, and Missouri all coming together right there it gave me easy access to four quail seasons in four states.’
“The result was the leaf in the tornado.
“‘It turned out that the first big lesson we learned,’ wrote Walton, years later, ‘was that there was much, much more business out there in small-town America than anybody, including me, had ever dreamed of.’”
The average and the poor in India
When two urban men living in Bengaluru did the math on what it means to be a poor Indian citizen, they were astonished. “They calculated that India's Mean National Income was Rs. 4,500 a month, or Rs. 150 a day. Globally people spend about a third of their incomes on rent. Excluding rent, they decided to spend Rs. 100 each a day. They realised that this did not make them poor, only average. Seventy-five percent Indians live on less than this average,” writes Harsh Mander in The Hindu.
On attempting to live with this kind of money, “They found that they could not afford to travel by bus more than five km in a day. If they needed to go further, they could only walk. They could afford electricity only five or six hours a day, therefore sparingly used lights and fans. They needed also to charge their mobiles and computers. One Lifebuoy soap cut into two. They passed by shops, gazing at things they could not buy. They could not afford the movies, and hoped they would not fall ill.”
So, what might it be like to be poor in India? “Could they live on Rs. 32, the official poverty line, which had become controversial after India's Planning Commission informed the Supreme Court that this was the poverty line for cities (for villages it was even lower, at Rs. 26 per person per day)?”
They attempted to live on Rs 26 as well and discovered how harrowing life gets for 400 million Indians. But their narratives don’t make it to the mainstream.
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How to be a bad boss
The term halo effect refers to the human tendency to believe that because a person is good in one area—say, is doing well at the university—he must be good in other areas too—running a business. Sometimes we also associate a negative attribute to a positive attribute. For example, some of us associate rudeness in civil servants to their being non-corrupt. It’s true of businesses too. In Bloomberg, Adrian Wooldridge points out that while some of the tech emperors have done more good than harm, the trouble is that “too many people think that all you need to do is to imitate the peccadilloes of the successful—act the jerk like Steve Jobs or grow a Rasputin-style beard like Jack Dorsey—and you will be a business genius. Innumerable metrics suggest that the problem of bad bosses is a big one.”
He lists out a few examples of Silicon Valley archetypes that have had a similar effect on entrepreneurs and business leaders.
- The jerk boss. “Steve Jobs mistreated everyone around him but nevertheless changed the world.”
- The crazy genius. “Elon Musk spent half the earnings from his first start-up on a race car—and when he crashed it with Peter Thiel in the passenger seat, his response was to laugh maniacally about his failure to insure it.”
- The fabulist boss: “WeWork Inc. was in the rather humdrum business of selling short-term office space in cities but Adam Neumann, the 6’5”-inch former Israeli naval officer who ran it, managed to persuade investors, notably Masayoshi Son, that he was really selling ‘the future or work,’ or a ‘physical social network’ or even a ‘capitalist kibbutz,’ as if such a thing might be desirable.”
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Corrigendum
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