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The Young Man's Business Model
- tptacek 18y agoGender bias much?
- jcl 18y agoHe explains the source of the term in the article: an observation of a specific, real-life experience -- the "young man" way to repair a motorcycle versus the "old man" way to repair a motorcycle. It's not exactly his fault that no old or young women showed up to help him and his friends fix their bikes.
- omouse 18y agoGender bias doesn't mean jack-shit in this situation. The genders of the characters involved does not alter a damn thing. He could have been talking about two hermaphrodite aliens instead. Hell, he even said, 'Now when I say "old man" here and throughout this article, I don't necessarily mean "old" (and I don't necessarily mean "man") - I mean "experienced".'
- angstrom 18y agoBest nugget of truth: The best business model is one that makes your customer money. From my personal experience eyeballs and race to the bottom savings never work in your favor unless your'e YouTube or WalMart.
- jharrison 18y agoMaybe I'm just old (and by old I mean almost 40) but this is the only business model that has ever made sense to me. I'm obviously impressed with the Facebooks and the HotorNots and everyone else who manages to make a truckload of money without any actual product or service (that I can identify the value in anyway), but I can't ever seem to get interested in doing "business" that way. For me, if you don't actually have a real customer, or what you're doing doesn't make them money, then what have you built? It doesn't sound like a business to me...but I might just be old.
- wanorris 18y agoIn the hacker world, there have always been people who try to make things that they think ought to exist, regardless of whether they can figure out how people will pay them to do it. On one end of the continuum, you have projects like Linux (and the original Unix), Lisp, Perl, Python, Apache, and so on -- projects where the originators never really worried about monetizing the result at all. On the other end of the spectrum are things like Facebook, Twitter, and Google, where the originators always planned to find a way to make money, but didn't worry too much about the details until they had developed a product that a lot of people wanted to use. In any case, there are an awful lot of businesses that don't make their customers money. Consumer products, retail, mass media, home construction, automobiles. Making your customers money is basic in business-to-business, but unless I'm missing something, it's rarely a core part of a business-to-consumer model. Perhaps it's B to C in general that you're not comfortable with?
- skmurphy 18y agoBusiness to consumer media businesses makes the advertiser money, in that the increase in sales revenue should exceed the cost of advertising or they won't keep buying ads. The other consumer businesses you cite--consumer products, retail, automobiles--are typically sold through distribution, and the distributor makes money on the markup. Home construction is somewhere between a service and a craft business.
- wanorris 18y agoWell, yes. But that isn't always the most useful paradigm for thinking about some of those businesses, and it doesn't always apply. When I go buy an iPod at an Apple store, what customer makes money off the purchase? When Safeway sells me a pork roast, what customer makes money off the purchase? When I subscribe to a premium account at ESPN, is there a customer that makes money off the purchase? For manufacturers, it is certainly important to develop a value proposition for distributors and retailers. For ad-driven media businesses, it is critically important to develop a value proposition for advertisers. But it's at least as important to make something that people want. If you have a product that nobody wants, it doesn't matter how good the retail markup is. If you have a media property with no eyeballs, what good will really brilliant advertising packages do potential advertisers?
- dkokelley 18y agoExactly. It's much easier to sell added value than reduced costs.
- skmurphy 18y agoThis is a great article, and nicely articulates the differences I see between a lot of the bootstrappers I know and the accepted wisdom on Hacker News. In a down economy it's safer to target an existing cost stream, prospects become very risk averse about value. A lot of technologies start out as cost savers and transform: e.g. VoIP vs. POTS, initially a cost saver, now allows a much richer set of options, repeating the pattern of TCP/IP vs. SNA.
- edu 18y agoI think it is: The best business model is one that creates wealth for your customer. Be it money, time, or anything else.
- wmf 18y agozinxq: Permalinks are good.