Decius wrote:
] Thrynn wrote:
] ] And therin lies the problem. People who start and/or run
] ] businesses end up getting consumed by ambition and ego.
] Their
] ] businesses end up failing, or failing to meet the full
] ] potential becuase that person refuses to make an
] organization
] ] that can function without him or her.
]
] Ambition can be a good thing, but ego, I think, is only useful
] to the extent that people tend to follow egos. Don't beleive
] your own schtick.
]
] I've seen what you are talking about a lot. I call it the
] lifestyle trap. People start a business. It works. They grow a
] little. They grow out of the stuggling to eat phase and reach
] a point where:
]
] There are a number of people working for the company.
] The company has healthy cash flow.
] You can pay yourself a good salary.
] You are the man in charge. You can do what you want.
]
] At this point, the companies stop growing. Because the CEO has
] everything that he or she wants. Self reliance, power, and a
] comfortable lifestyle. These companies don't go anywhere
] because the CEO isn't really interested in fullfilling
] anything other then his or her own personal needs.
]
] The company becomes a lifestyle company. It exists to provide
] the CEO with a particular lifestyle.
]
] CEOs of lifestyle companies never really know that they are
] doing this. At least not that I've seen, and this seems to be
] a pretty common theme.

Moreso than a 'lifestyle company', this is very desirable result for an entrepreneur. Obviously you've not learned your lesson in Business 101 from the dotcom boom. If you can start a company, grow it to be cash flow positive (bonus points if it's kicking off lots of cash) and never have to raise more funding, then what's to complain about? Even from an employee's POV, this is almost the ultimate situation, since the company stays solid and doesn't have to go through the pain and suffering of having investors coming in and screwing around with the company.

Only slightly more desirable is that the company goes public at a premium valuation and everyone's options vest. This is better for each individual shareholder financially, but I sometimes question whether it's better for the company, its employees, and ultimately its customers. There's a big difference between being a privately held company and a public company, on many levels.

Probably the thing that surprises me the most about your comment is the pro-growth undertone. We've had discussions on Memesteams before that growth for growth's sake may not be all it's cracked up to be. Everything in our world is finite, so continuous growth of anything is impossible. At some point, growth stops. It can be argued that simply growing for no other reason other than 'because' is bad. Bad for the economy. Bad for the environment. Bad for organizational health. Bad for human beings.

In the strictest sense of organizational well being, growth might not be the best quality. If you could have a company where everyone loved to work, customers were happy, it made money, and you don't have to continue growing, that would be the easiest company to manage. Depending on your margins, you could focus a lot of energy on nurturing the organization. You would kick off dividends to shareholders. In the perfect world, employees would all own chunks of the company and participate in the dividend. Life would be bliss.

So I would say that if people are achieving this state, it's not by accident, and they are certainly aware of it. It's basically business nirvana.

RE: The founder of Visa on Corporations