MicroIVs - Making Dreams Come True
Submitted by Steve Moyer on Fri, 2006-07-14 14:45.
Hey! Where's the "S" ... that's the all important "Software" part! If you thought I misspelled the title of today's post, I didn't. I'm starting off today talking about "Independent Vendors". Does the same Internet that enables MicroISVs today also support the creation of self-sustaining MicroIVs of different flavors? I believe it does! If you didn't catch the thinly veiled recapitulation of the the title of Bob Walsh's excellent book, "MicroISV - From Vision to Reality", all I can say is "Shame on You" (okay, maybe you're in the wrong place ... you can find Google here). If imitation is the most sincere form of flattery, then maybe other businesses can follow the MicroISV leaders. Almost every topic in Bob's book is either directly or indirectly related to every small business.
First, I'd like to relate an observation I've made; On average, first and second generation immigrants seem to understand the American Dream better than the rest of us. People who immigrate here expect to be able to create a new life for themselves through entrepreneurship and sweat. Those of us with many generations of american ancestors have bought into the status quo of working for "the man" 40-45 years and then enjoying our retirement (well, I guess not all of us believe that social security will still be around and many on this site would be bored with retirement anyway). In any case, how has the american dream faded? We let it! The good news is, we can revive it any time we want (the government recognizes the importance of small business and is still quite supportive). I also have a question for those who believe that immigration should be severely limited or eliminated altogether; Would the american dream die without an influx of people looking for it?
I lost the american dream the easy way. I'm a sixth or seventh generation american and my parents are both Guardians (if you're not familiar with Myers-Briggs personality types, see my previous post "So You're a Programmer, But Should You Be?" for resources). My upbringing stressed becoming a "responsible" adult. The idea that I didn't necessarily believe in (or agree with) the establishment was something my parents actively sought to quash. After all, you couldn't possibly have a happy life or successful career without "the man's" help. "Be a nice little cog in the machine" they used to say (not in those words ... I'm paraphrasing).
To be fair to my parents, they did supply a vast supply of love, encouragement with my more sensible interests, pushed me in school (that was a lot of work and would have been much easier if I'd understood my personality type and learning style at the time) and provided an endless supply of items that I could take apart in an effort to satisfy my curiousity of "How this works" (they were especially happy when I became skilled enough to successfully reassemble these items). Sometimes, they just supplied raw materials and let me build things (like the the electric motor I built when I was twelve or so, from tin cans, scrap wire, coat hangers and wood ... it ran pretty fast from a car battery, but had zero torque ... once I had a few electronics classes, I understood that it didn't have enough windings). I also know with absolute certainty that the most valuable lesson they taught me was the self-satisfaction that occurs through hard work and a job well done. I've noticed that they seem to accept my view of the world a little more now ... they have a little antiques business that they enjoy working on and tolerate my ideas about alternate careers styles a little better. It may also help that I've been out of the house for twenty years and haven't had to move back in ... yet (just kidding mom and dad). Now I'm past forty, and seem to finally be getting over this mindset (not that it worked really anyway; I never fit in that well but it was enough to cause me to question my natural entrepreneurial drive). Of course, now it's much harder to strike out on my own with a family of six to provide for.
What I can do now is to reinvigorate the american dream in my children. My oldest two are now 15 (son) and 13 (daughter) and are an ENTP and an INTJ respectively. While they are almost completely different, both have incredible artistic stills; My son is an award winning photographer and my daughter is a successful jewelry designer (can you tell I'm a little proud). It's my belief that both these disciplines lend themselves to businesses in the form of MicroIVs. We provided about $500 in "seed loans" to each of them, and have taught them the basics of business as needed (it's somewhat funny to watch them count their gross income each night and figure their net profit). This week, there are two major arts festivals in our area and they're selling at both (there are pluses and minuses to being children in this case; the fees for exhibiting are much lower than for adults, but many of the attendees don't expect the children's exhibits to have wares targeted at adults). My daughter started last summer and paid back her seed loan with her first day's profits (and subsequently earned enough to pay for a missions trip to Kenya). My son started last fall (missing the biggest shows in our area) and should be profitable today. His goal is to earn enough that he won't need to work at McDonald's next summer. We've also recently acquired both their names as .com domain names, and will probably have e-stores up this fall.
I don't think that it's coincidence that the MicroIV revolution started with software vendors. I believe there are three different contributing factors;
First, it is possible to bootstrap a software company with very little money if you're willing to put in a lot of sweat equity. Patrick McKenzie's blog chronicals the whole process of creating both his Bingo Card Creator product and business. I love his tagline: "The schedule: 8 days. The budget: $60. The results: read on." and last time he tallied his balance sheet, he had only spent $43.22. Both my kids have spent five times that much on supplies to build their inventories!
The second factor is that the software engineering discipline seems to be heavily populated with Rational personality type (NTs). As such, we tend to have a more entrepreneurial, anti-establishment view of our world. Beware that there are also certain "flaws" inherent in these personality types that can cause problems if not recognized and accounted for. I take great pleasure in a recent post at "Joel on Software" titled "Salaries - what do you get". Check out the number of high-paying jobs, both MicroISV and company employed, that are held by high-school graduates and college drop-outs (looks like we should call them opt-outs). That's nothing against college graduates, it's just an indication that self-education and passion drives this industry. Also notice the income that the MicroISV owners enjoy is well above the norm (I should do some statistical analysis of this post, although purists would argue that anonymous posting is not a valid method for statistical sampling).
The third factor is that those who can produce a software product can also produce the website required to sell it. Non-software MicroIVs will require a partnership between the entrepreneur and a software developer. To Ari Goldberger (the person who registered mystore.com): if you can create a skinnable system for e-stores, like myspace.com, that handles all the programming details, allows a variety of landing pages per product and integrates with payment processors, you will be inundated with business ... ease of use is key! MicroIVs will also become more common as web development becomes mainstream (my kids are already learning web development in school).
Paul Graham's start-up creator, Y-Combinator, has a specific preference for young founders. I absolutely disagree with his assertion that us "older" entrepreneurs can't handle the hours required to complete his rigorous three month program. I do however believe that it is much easier for a fresh college graduate, with little to no responsibilities other than caloric intake to bootstrap a business ... it's a matter of paying for the life outside the business that makes it harder for us old fogies (in my case, supporting a household for the six of us is a full-time job and raising four kids is two full-time jobs for my wife). What if we all helped our kids start small businesses in their early teen years (even failures would be a learning experience)? Surely there's something that your kids are passionate about that can be profitable. They'll be much happier in the long run.
Seth and Anna: I love you and I'm very proud of you ... follow your passions and dreams.