

The formulas for giant companies are the same - skowmunk

Its amusing, amazing, surprising, but the general bunch of formulas used to build giant companies, monopolies and the sort have remained the same over more than a century.<p>The formulas used by the Gateses, Ellisons, Sergeys &#38; Brins are more or less the same as the  formulas used by the Venderbilts, Rockerfellers, Carnegies, Morgans...
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jaddison
Was there a link missing in this story? Otherwise, it's rather
unsubstantiated. :)

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skowmunk
Its just the thoughts of an armchair analyst who likes browsing through
history now and then, not an article.

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itg
and what are these formulas?

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skowmunk
To be honest, I didn't study them as much as I would like to, tengo no tiempo
amigo. :)

But with the very little bit of reading I did about them, this is the pattern
I noticed:

(Obviously what I have put down here is a highly simplified version)

1) Breach the market with a cash cow

2) Keep using that cash to keep acquiring/developing other potential assets -
aggressively

3) Keep integrating the acquired/developed assets into the cash generation
models as soon as you can or/and Keep integrating the acquired/developed
assets into the business model to channel or keep channeling as many existing
and potential customers to your existing cash cow/s

4) Keep repeating 2 and 3 as much and as often as you can, because the day you
stop, you stop growing and the lesser is your ability to defend your turf

5) Keep eating competition before they become a competition. (lot more capital
efficient)

But this formula/strategy is something most of us mortals can't even implement
successfully even if given. Because this formula/strategy is just half the
story of those giants(companies). The other half of the story are those
intellectual giants - the people behind these giant companies.

To really implement this strategy to make a company into a giant, i would
think this would be a hyper shortened and simplified list of characteristics
somebody would need to have:

1) an insatiable hunger for information and knowledge

2) the ability to put that information and knowledge into patterns constantly

3) the ability to see the value of seemingly useless (to others) information

4) the ability to build incredibly complex strategies that are immensely vast
in breadth and depth and may reach out to a few years if not decades into the
future

5) The ability to keep stable, build or modify those strategies using
information that is constantly flowing in.

6) the ability and guts to not follow the crowd when required

7) capability to be hyper-vigilant of the center AND peripheries of the
market/technological/strategic boundaries

8) a huge appetite for highly educated massive risks (not at all for the
impulsive type)

I am sure these, if at all they do, represent a tiny fraction of the
dimensions those intellectual giants operated upon.

Good luck.

