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37signals Earns Millions Each Year. Its CEO’s Model? His Cleaning Lady (fastcompany.com)
468 points by endtwist on Aug 29, 2012 | hide | past | web | favorite | 228 comments



"I won’t name names. I used to name names. But I think all you have to do is read TechCrunch. Look at what the top stories are, and they’re all about raising money, how many employees they have, and these are metrics that don’t matter. What matters is: Are you profitable? Are you building something great? Are you taking care of your people? Are you treating your customers well? In the coverage of our industry as a whole, you’ll rarely see stories about treating customers well, about people building a sustainable business. TechCrunch to me is the great place to look to see the sickness in our industry right now."

I love this quote. It reflects my sentiments to a T.


The reason the press writes about funding rather than revenues is not some kind of conspiracy to focus on the wrong things, but simply because reporters know about funding rounds and not about revenues.

It's clear that the press would write about revenues if they could, because they write a lot about the revenues of public companies. They're able to do that because public companies have to disclose their revenues.

Private companies never publish their revenues. Including 37signals. So if Jason really believes this is a terrible problem and wants to set things on the right course, he should set an example and start publishing 37signals' revenue numbers.


This is unusually straw-mannish of you pg.

From the article: "What matters is: Are you profitable? Are you building something great? Are you taking care of your people? Are you treating your customers well?"

All of those questions can be answered without needing access to a companies ledger. Jason answers those questions himself in the article.

I think his point was that stories about those questions don't get as much readership per unit of reporter effort, hence they aren't being written.

Posting 37signals' revenue numbers would have zero impact on that.


Anyone who proposes that the discussion should focus on profitability rather than funding rounds is presumably not proposing that we simply talk about it as one bit of information: profitable or not. That would make pretty short articles. It also wouldn't be very interesting; there are hundreds of plumbers and barbers and cafes within a few miles of me who are profitable.

And plenty of these plumbers and barbers and cafes probably do great work and treat their employees well. Do you really want to read articles about all of them? I don't. What makes a company newsworthy (unless it's as a case study) is its size, or potential size.


It sounds like you might not be familiar with the author Jason referred to right before his critique of the current focus on size: Ricardo Semler.

In his books he develops a very humanistic look at the role of businesses in our lives. As entrepreneurs, employees, and as customers. I won't be able to do the ideas justice here, but I will try:

A business obsessed with revenue and growth is like a person obsessed with how many breaths they have taken, or how much food is in their pantry -- these are means to an end, not ends in themselves. Food is required for life but it's not the purpose of living. Businesses as conceived by Semler and Fried aren't designed to maximize revenue so much as make the world a better place (#include your essay about google being almost a nonprofit).

It may be that stories of plumbers, barbers, and cafes wouldn't be interesting to you. I like to hear about people living enjoyable lives, delighting their customers, and making their corner of the universe a better place. It's a lot more psychically healthy than reading about people trying to gain the most while providing the least (the tech crunch articles Jason refers to)

So many people seem obsessed with getting a large quantity of money, and only then trying their hand at building a fulfilling life. I have always thought of Semler as running things in reverse: how do we design a seven day weekend that is cash positive?

(Semler's book, The Seven Day Weekend, is highly recommended to anyone who wants to hear more)


I understand quite well the idea of company that isn't focused simply on revenue growth. I've been running one for the past 7 years. And I'm interested in reading about others. But articles of that type are case studies, not news, which is why I explicitly distinguished between them.


first "What makes a company newsworthy (unless it's as a case study) is its size, or potential size."

then "But articles of that type are case studies, not news"

first "Do you really want to read articles about all of them? I don't."

then "I've been running one for the past 7 years. And I'm interested in reading about others."

I think what you want is for Jason to have said "I wish the technical community were focused on case studies of awesome companies rather than news stories about funding and growth." Which I think he would agree with, and would remove your points.

(Not that case study vs news is a real dichotomy -- what's stopping someone from calling news about a round of funding a "case study about getting funding"? Why can't there be news stories about how awesome the customer experience at X has gotten?)


Not that case study vs news is a real dichotomy

In fact, we see case studies as news (and even less-than-news) all day long here and elsewhere. You can tell by the titles that generally come from blogs and usually look clickbait-y: "How Company/Developer X achieved goal Y," "Why Language Z helped us triple our revenues," etc.


News is, by definition, about current events. Case studies are about past events. So, in general, they can't be the same thing (even if, of course, the publication of an interesting case study can be interesting - and current - news).

"Why can't there be news stories about how awesome the customer experience at X has gotten?": If you really want to know, I advise you to read "Storytelling: Branding in practice".


News is, by definition, about current events. Case studies are about past events.

You are logically incorrect. Well, by your own logic. How can you publish news about a current event? To be written as news it has to be happened in the past.


It all depends how you define "current".


I'm afraid I have to disagree here. As someone who runs a small business which, for not-immediately-relevant reasons isn't in a position to try for startup-style explosive growth, I'd be really interested in hearing about how people in similar situations run their business. Regarding your examples of plumbers, barbers and cafes, we all think we know exactly how to run these, and in our heads probably think it's a pretty simple thing. What if we're wrong and there's something to learn?

I believe that businesses in this space are run with old-fashioned tools (management methods, process optimisation techniques, technology) for reasons of tradition and lack of information sharing rather than anything inherent to the businesses themselves. My experiences with business growth accelerators leads me to believe we as a community re-invent the wheel an enormous amount, and anything that helps me reduce that is of interest.

Sure, we have a different metric for success, but that doesn't mean there aren't unusually successful small businesses (that will remain comparatively small) that might have something interesting to say.


lay off Paul, he's not making an arguement here that one is better than the other, he's arguing that the press wants stories that pull readership. Writing that Instagram sold for $1B is more interesting than someone that makes a few million in profit a year and has 4 day work weeks.

I myself side with the 37 signals guys that profit is king, but that takes nothing away from my friends that are in start ups chasing big coin.

Either is a viable strategy and i think it's terrible that this community doesnt allow both to co-exist as viable options.


> i think it's terrible that this community doesnt allow both to co-exist as viable options

I think it does. There are many of us that are focused on either lifestyle or profit-driven businesses and those articles are often received well. What isn't are articles attacking the funded companies' approach.


The only way I can see this happening is if dotcom bust 2.0 happens (or major changes in tax code, macro economy, etc), employees totally write off the value of equity, and companies switch to profit sharing payouts. Cash salary is more directly relevant, though, with some guarantee of payout -- quitting a safe $100k/yr job for a $20k/mo job at a startup with $20k in the bank, maybe not.

Companies would also pick vendors based on financial stability, for which profit is probably a major factor, although cash in the bank would also be.

Or maybe it would happen if investment rules relaxed and private equity (Private Equity or direct investment like second market in non-public companies) happened, as communicating financials to lots of investors would still be relevant.


"And plenty of these plumbers and barbers and cafes probably do great work and treat their employees well. Do you really want to read articles about all of them? I don't."

Personally I believe there are many great lessons to be learned from those local/profitable businesses which if written I'd gladly consume. If the press would only dig for those types of stories I'm sure they would come back up with gold.

As an entrepreneur who is interested in growing a long lasting and sustainable business there are many lessons which I can imagine a seasoned business owner, no matter the market, could teach me (i.e,: how had they dealt with times of feast as well famine. What was it like when they had they'r first repeat customer, etc.).

"What makes a company newsworthy (unless it's as a case study) is its size, or potential size."

To be honest I believe this sums Jason's point in one line.

The current tech culture doesn't seem to acknowledge nor celebrate the stories of those founders, entrepreneurs, developers, or business minds whose offerings are geared towards providing impecable customer service; so that doesn't get written about fairly frequently.

Now I may be wrong in my observations but it would seem as if this current generation of the tech vanguard simply aren't interested in those things. The signal, which has become an ever increasing continuous one, seems to be about more, more and bigger, bigger, bigger.

Hey, maybe that's all there is to it, but I'd like to believe we've got much more in us than simply who can amass the largest seed round, or who has had their Series A round over subscribed.

Again, I may be wrong but just a thought.


"And plenty of these plumbers and barbers and cafes probably do great work and treat their employees well. Do you really want to read articles about all of them? I don't. What makes a company newsworthy (unless it's as a case study) is its size, or potential size."

The real world is a better movie. Real people, real work, real life make for interesting stories. I would much rather read about healthy business, regardless of size, than sizeable business, regardless of health. Jason Fried was on target.


So I guess you spend your afternoons reading blue chip 10-k's? Didn't think so.


Just Sunday afternoons. Haven't for awhile. Keen to get back into it. All the best with the work at Etsy.


Apologies, that 3AM comment came off more dickish than I intended. Was meant to be a joke implying there is reason people don't write stories about simple, successful companies: they're boring.


DHH and Jason have both been making big statements on profiability and how it is good to charge your customers etc - in fact when FB was valued at 33 billion DHH wrote something that basically said it was nonsense.

Although one part of me says that the message is good, the other part says - why dont they publish their size? Like you rightly said, the value that many people would attribute to their words would vary based on size.

And the other thing is, many of these concepts that they tout might only work for a particular size. that is another reason we need to know how big they are.


But I'd bet those blue-collar folks would not mind being written about like "startups" get written about. A little hype could do them a lot of good.

What makes a company "newsworthy" is a good PR firm!


pg, if you think potential size is interesting, why are you so against the biggest ideas?


The press loves to talk about changes, because news only comes out when something changes. The timeless pieces only exist in opinions section.

In startup's context, fund raising is definitely a change, and revenue numbers may be a change (when they are surprising or previously undisclosed). But building a sustainable business, treating customers well or even being profitable should be long-lasting and timeless. It's interesting to keep reading about these issues in Hacker News, but these are not exactly news.

It's like business fundamentals ("common sense"). The press never talks about them but it doesn't mean the industry doesn't care or doesn't treat them as important.


This is a fair point. Journalists are just using available public information.

37Signals' numbers are not public. "Talk is cheap" as they say.

I don't disagree with what he is saying in the quotes - that people focus too much on raising money as "business success". This is without question. But then again I still do not understand the value of 37Signals (compared to any other software company with aggressive marketing), at least not from the press they get. How are they being any more transparent?

All I know from recent reports is employees supposedly work 4 days a week and they have some sort of brainstorming sessions to come up with new ideas. What does the 37Signals software do? Specifically, not just some marketing buzzword. What does it do that I can't otherwise do without it? Are there some YouTube videos showing the software in action?

How do I know it's not just a Ruby on Rails consulting business for a few steady clients (who have an inseparable attachment to Rails), as opposed to a "unique" software company with amazing products? How do I know they're not just selling a Rails framework? So I have to install Ruby, Rails and a gazilion of their custom scripts to use their "product"?


> What does the 37Signals software do?

I guess you've not looked at http://37signals.com before posting this?

> So I have to install Ruby, Rails and a gazilion of their custom scripts to use their "product"?

No. You need a browser though, because it is web-based.


Forget what I say. It's just me. "5,000 companies sign up every week." But "keep all project discussions, emails, and stuff in one place" just doesn't draw me in. I don't have a problem with "keeping all project stuff in one place". 37Signals appears to be aimed at solving a "problem" I do not have.

I have looked at their website several times. It just never grabs me. And I'm not inclined to give them my email address to try out their amazing "solution".


I participate in a few Basecamp projects operated by clients and from my point of view, it just forum software (like phpBB, IPB, etc.) with, arguably, a better interface.

I personally don't think it is that great, with many pain points that I encounter - which, I will concede, may be a case of using the wrong tool for the job over any shortcomings in the product itself - but it is better over having no group messaging system at all if you are working with multiple people at a distance.


So they sell something you don't need. Why do you have a problem with that?


Assuming what you say were true (i.e., that I "have a problem" with 37Signals), do you "have a problem" with me "having a problem" with that?

Do you also sell something people do not need? And does it make you uncomfortable when people who do not need it mentions that to an audience via HN, the same way 37Signals keeps working to make mention of itself, or have others do so, in publications with large audiences.

If I have no need for a service someone is selling and I never hear about that service, then I have no reason (maybe even no ability) to to state what I think about that service. But if in the course of reading the "news" I am continually reminded of the service's existence, I may be inclined to comment. That is the risk you take with PR and advertising, or internet-based hype in general.

So it seems that 37Signals sells the use of their forum software (constructed from Ruby on Rails, i.e., free software), hosted on 37Signals' computers. I am getting a clearer picture now.


What you are saying is akin to somebody from the revolutionary war going forward in time to the age of the cell phone and saying "People are talking through these boxes but I communicate just fine with the people in my house. I don't need these boxes. It's okay if you do."

I'm not by any means suggesting that you're stupid or out of your league, but simply that you are talking about something that you are clearly completely unfamiliar with. Have you ever managed a team of people and projects? Once you do you will understand what an incredible pain in the ass it is to rely on email and spreadsheets. Full disclosure- I am NOT a 37Signals customer, nor do I know anybody affiliated with the company. Simply that project management software is a very real need for a very large number of teams. One of their partners created Ruby on Rails to create Basecamp, then released the framework for anybody to use and remained as a core contributor.


And your response is akin to someone being concerned about the words of a person from the 1700's reading about cell phones and asking what all the fuss is about, and maybe even stating he does not need one.

Why would you care about that? How could this person from antiquity know anything useful?

Interesting.


On the other hand, a "sickness in our industry" doesn't have to be the majority behavior. It may seem more common than it actually is since it's easier for the press to talk about the businesses that just care about quick exits, but there are still companies behaving that way.

Jason's problem doesn't seem to be with the reporting; it's only coincidental that it's easier for press to report on the businesses he finds fault with.


" So if Jason really believes this is a terrible problem and wants to set things on the right course"

Well you know that's not going to happen especially since he made this statement below:

"We have 35 employees at 37signals. We could have hundreds of employees if we wanted to--our revenues and profits support that--but I think we’d be worse off."

So he isn't simply saying that he feels he could expand his business and have "hundreds of employees". He is saying that his "revenues and profits" would support "hundreds of employees".

Think for a second how much profit you need to support "hundreds of employees".

I'll give him the benefit of the doubt that he was misquoted on that. If not, he's simply full of shit. This is BS to challenge Donald Trump.


First, 37signals has a large (for our field) in-house customer support team, so the mean fully loaded head count cost of a 37s employee is lower than the number you're thinking.

Second, I think you are underestimating just how profitable 37signals probably is. They have scaled a few tight products with high recurring revenue to a very large number of customers with a tiny team. I've worked at companies with hundreds of employees and knew their revenue numbers and the model 37signals is executing puts those numbers well within reach.


Ok point taken re fully loaded.

"just how profitable 37signals probably is"

As an aside to this discussion: If they are actually that profitable it's a good idea to fly below the radar and resist making statements about how wildly profitable they are. Doing that might entice competitors to enter the same market and regardless of whether they succeed or not that could kill the goose.

Sometimes of course things are out in the open and it can't be avoided (lines at the restaurant or with public companies, or Oracle posting their 24x7 software support rates where a guy out of his house can do the math). Sometimes you want the publicity for one reason or another. But despite the openness of the internet there are still things that you want to keep to yourself lest everybody and their uncle decides to move into your neighborhood.


I think this is one of those cases that's akin to the famous quote by Supreme Court Justice Potter Stewart when he said "I can't define pornography, but I know it when I see it."

I think a lot of people are sick of the crap written on TechCrunch for reasons that are hard to define. Mostly they have turned the innovative process into a form of TMZ, which glamorizes a field that is meant to build things to make lives better. Very few articles have anything to do with companies building these types of innovations, and profits have nothing to do with it. A response might be, well Scientific American writes those stories. Yes, and that's precisely why Scientific American is a respected publication oft-cited by Steve Jobs.

Too many stories on TechCrunch are titled something like "[Insert clever startup name] raises [insert some absurd amount of money] to become the [Facebook, Twitter, Foursquare, Birchbox] for [Work, Finding a cab, Healthfood]. These stories are ridiculous and cover mostly crap ideas that don't solve any real problems.


I would think that creating articles, or blog posts, talking about situations of how they specifically treat customers well, how and why they are building something great, how they take care of their people, etc.. would solve this more than posting revenues. Though that might come across too strongly as stroking your own ego.. Obviously being profitable allows you more benefits to how you treat people, the time you give or allow.


It certainly is true that reporters can't write about numbers that they don't have. But I also think that a startup going for broke is more exciting to read about - both when they succeed as well as when they crash. A race car is more exciting to watch than a tractor.

It's surprising that 37 signals isn't labeled a "lifestyle" company, which is practically like leprosy when it comes to funding and media attention.


Also, TC (and others) have a huge following from startup community. For early stage companies, funding and hiring have big impact, perhaps next only to customer acquisition (and that is usually not shared). So i wonder if they are only serving their big target segment well by reporting on these.


It's interesting how you always seem to chime in at all the appropriate times. Get some work done, you!


I once got to see Jack Welch give a talk and he basically said the same, but about American labor unions. He said if you want job security, the answer is "customers". There is no other shortcut in business.


It's what every great organization I have ever been a part of has been about. My current gig, we put the customer first 24x7 and go out of the way to ensure they're comfortable. We're currently one of INC's fastest growing companies two years in a row and hiring new employees daily to meet demand.

I just spent 20 minutes writing an email with detailed screenshots of how to add a menu item to a CMS. I can't stand the CMS that this client uses. We inherited it and it blows. They're an awesome client though, nice people, and above else, they're my customer. I have no problem going out of my way to ensure that they've got detailed and easy-to-understand instructions.

A startup that some friends and I started a few years ago: schoolrack.com. Our users were teachers from elementary to high-school. You can imagine we dealt with TONS fo technical support requests from both confused parents and teachers. A lot of teachers are still forced to use IE6. Patience and always putting the customer first is what made us successful. Our users adored us. We'd start at a school and overnight every teacher there would be using us. Our users always had nice things to say about us because we always put them first.

When I worked in Apple retail, they reinforced the same principles. Understand the customer. Put yourself in their shoes. Frame your questions so that they are not misconstrued. Make technology friendly. Know your customer. If they're coming to you wanting Final Cut and a few Mac Pro's, don't try and offer them lessons on how to use a word processor (exaggeration). Of course not every Apple employee is a saint, and sometimes you have a bad experience. We're humans, after all. But the principles work.

Bend over backwards for your customer. Treat every single person you interact with on a day-to-day basis with respect and kindness. Even the UPS who comes to pick up your deliveries.


???

Customers won't give you, hapless employee, job security if your employers can easily replace you with someone cheaper because you have a flimsy (or no!) contract, nor will customers help you with disputes with management, or wrongful termination, or promotion from within, or even the too-little-emphasized increased potential for synergy between the ranks that unions afford, or any of the many other things that unions afford.

Customers might help prevent a company going out of business, and that, to be sure, is good for job security. But a company that's flourishing customerwise can still have rapacious or simply bad management.


You shouldn't need a contract if you're adding value to the organization. If you can get replaced by someone cheaper, then you weren't worth what you were getting. Why the heck should a business pay more for the same outputs? If you're adding more value than you cost, your job is always safe. The union mentality is exactly the reason American manufacturing has left for cheaper pastures. Union employees aren't about adding value, they're about protecting their own ass rather that striving to find ways to add value to the organization.

Business owners do not have an obligation to keep everyone employed, they have an obligation to make a profit, if there's no profit, then they won't be able to employ anyone for very long.

Good employees are an asset to any company. You don't get "wrongfully" terminated if you are adding value of a company.

I will never hire union labor ever. I would close down a business before I submitted to the extortion of unions. If I hire people, I treat them really well because they add value not because a contract says I must. Google employees aren't unionized -- Google understands that to attract the best talent you have to treat people well. Google employees don't need a union -- they know that if they're providing value, their jobs are very secure. It's the lower-skilled workers with chips on their shoulders that are the first to cry about needing a contract to "protect" their rights.

Contracts protect the employees that strive to do the minimal possible under the terms of the contract. Unions have made employees interchangeable because you get paid based on your job title and seniority, not necessarily the value you bring to the organization. The big tragedy is that in union shops, when layoffs happen it's the junior guys that go first, even if they're better workers than the more senior. It's disgusting that years on the job mean more than actual job output. Unions had their place before OSHA came along, but now they are corrupt labor monopolies where the bosses get paid millions each year cronyism and corruption are the norm. If you don't like a company, you're free to quit, but in closed-shop states, if you don't like the union, too bad, you have to be a member (or pay the dues) if you want to be employed in that field in your state. Detroit is 1993 Sarajevo because of unions, while North Carolina is doing pretty well. The difference is the unions.


> If you can get replaced by someone cheaper, then you weren't worth what you were getting.

Spoken as someone with specialist skills that are in sufficient demand and business critical enough.

> I will never hire union labor ever. I would close down a business before I submitted to the extortion of unions.

So in other words, clearly people need contracts - and some will need unions -, since you're making it very clear you have preconceived notions about employee behaviour based on external factors that have nothing to do with their job performance, and you're not the only one.

Unions were formed because people realized their negotiating positions were excessively weak compared to the employer-side who held all the cards. E.g. getting to the 8 hour working day, for example, took American unions many decades of struggle to achieve (and the rest of the world commemorated that struggle by making May 1st the international day for workers demonstrations in direct response to the Haymarket massacre)

> Contracts protect the employees that strive to do the minimal possible under the terms of the contract.

Contracts also protects great employees of employers that strive to do the minimal possible under the terms of the contract.

Somehow you seem to expect that employees should trust you implicitly.

> If you don't like a company, you're free to quit, but in closed-shop states, if you don't like the union, too bad, you have to be a member (or pay the dues) if you want to be employed in that field in your state.

So why are you making your arguments about unions in general when you then go on to describe features of unions in some locations that are by no means universal?

There's no doubt that there are unions that have managed to push things too far, but your argumentation is like saying all companies are bad because some companies have been abusive.


Unions were formed because people realized their negotiating positions were excessively weak compared to the employer-side who held all the cards. E.g. getting to the 8 hour working day, for example, took American unions many decades of struggle to achieve (and the rest of the world commemorated that struggle by making May 1st the international day for workers demonstrations in direct response to the Haymarket massacre)

Unions (and companies, countries, etc.) can't ride the wave of their past successes forever. Saying that unions were a good thing 100 years ago is not an argument that they still are.


Comparing Google to auto manufacturers that employ mostly union labor is not fair because the supply and demand curve for employees is completely different. When a potential employee goes into an interview at Google he/she knows that they are in short supply and high demand. This gives him/her leverage to negotiate salary, work conditions, etc. Google provides such a great work environment because they know this and are proactively meeting the demands of the candidates they're trying to attract.

Most employees at auto manufacturers do not have this same leverage. They can't threaten to leave for higher salaries or better working conditions because they are in large supply, small demand. Forming a union gives them this leverage so that they can negotiate at the same level as their employer.

I feel like the negativity towards unions is a result of some recently holding more power than the employers and getting unsustainable pensions and other extravagant benefits. But when the balance of power is closer then unions have been successful and often in necessary in making sure that employees are working in a safe environment, getting paid a living wage and generally not being taken advantage of.

TLDR; Labor unions are not all bad/good. They simply give employees the same leverage as their employers in industries where the supply for workers outnumbers the demand. It's not good for that balance to get out of hand in either direction.


Doesn't the supply and demand curve set the market equilibrium for the wage/contract,etc? Don't like the job...go find another one.


Wages are just part of the supply / demand curve. At the high end it's worth a lot of managment overhead to keep people happy, at the low end there is little incentive to do so.


Let's stipulate to the first sentence of your comment (and ignore everything that comes after it). If you're adding value to an organization, you shouldn't need a contract.

Wonderful! There you are, being a positive influence on your organization, knowing that you shouldn't need a contract. But! Suppose some manager doesn't recognize that you're being a positive influence? Or just wants to throw his weight around? Certainly, a person in a position of power who wants to throw his weight around shouldn't target someone who's a benefit to his organization. But perhaps he's perverse, or doesn't care, or views you as a threat, or (again) has made a mistake in his estimation of who's "adding value" and who isn't. You shouldn't need a contract in part because your superiors shouldn't do that kind of thing. But hey! They might do it anyway! The wonderful thing about being contract-free, or in an at-will employment state (i.e. almost any state) is that there's no such thing as wrongful termination and you have no recourse if you're fired---"but I was adding value!", in particular, is not going to be effective. In this sublunary world, you'd have to be delusional to maintain that if you're adding value, you don't need a contract.

Actually, I can't resist; let's look at the rest of the first paragraph in this light. How do you know that union employees in, say, Flint, were uninterested in "adding value" to the manufacturers who shut down the factories? People working manufacturing jobs---a skilled trade, you know---take pride in their work and I'm willing to assert, just as blithely as you were willing to assert the opposite, that they'd be plenty willing to try to improve the product, improve processes, etc., if they were but asked (and lots of improvements can, indeed, come from the rank-and-file in that way). It's true, of course, that when residents of Michigan are asked to add value to the company by accepting wages no greater than those commanded in Mexico, they are likely to balk.


> Suppose some manager doesn't recognize that you're being a positive influence?

Then one of you is wrong.

Yes, bad managers make bad decisions. A contract doesn't protect you from bad managers - it merely makes it easier to stay around to be subject to their badness. Why do you think that's worth something?

Contracts actually make bad managers look better that they would otherwise. Yes, bad managers survive longer when unions are involved. Why do you want that?

Life's too short to work for a bad manager. Of course, if all managers are bad (for you), maybe they're not the problem.

> People working manufacturing jobs---a skilled trade, you know---take pride in their work and I'm willing to assert, just as blithely as you were willing to assert the opposite, that they'd be plenty willing to try to improve the product, improve processes, etc., if they were but asked (and lots of improvements can, indeed, come from the rank-and-file in that way).

We can test that hypothesis by looking at what they demanded through their union representatives. Care to predict the result of said "look"?

I'll save you the trouble - they didn't demand anything to improve product quality or increase productivity.

On a related note, the head of one of the US teachers unions said that he'd start caring about kids when they started paying dues.


I don't want to mar the conversation with a pro or anti union debate. Let's take it out.

You have to turn those "what ifs" into "so whats" because there is always the chance that a manager is going to fire you unjustly. If the organization is setup properly, the loss of your employment would adversely affect your department's profit numbers. Since the manager is responsible for those numbers, one can assume there will be repercussions for a decrease.

This all assumes that the organization is a well-oiled machine, but since a vast majority aren't, you have to assume that you will be fired for any reason. The good thing is that if you can provide value to one company, you may have a good chance at providing value to another company (especially if it can be quantified on a resume). These are known as transferrable skills, and they're what good employees retain in order to get a high-paying job.


American manufacturing didn't leave. The US manufacturing output has doubled since '75, and it's bigger than Germany, France, Brazil and India combined.


Having customers is a necessary, but not sufficient condition.


I don't understand why you're being downvoted. I don't know what Welch said, but as it was characterized by the grandparent, Welch's statement is stupid, for exactly the reasons kenko explained.


If your employer has been infested by unions and there is a competitor, customers will rush to the competitor and your union will be of no help. Even if your union has managed to infest all your competitors in the same country, imports will ruin you all.


God knows the first thing I do when deciding whether to shop at a supermarket is find out whether it's unionized, and avoid it if it is.


If there's two supermarkets in town and one is unionized, the other one will probably be better for the customer in some way, usually because they'll have lower prices. Customers either don't care about unions or slightly favor them, but the end results of a union do drive customers away.

I don't think it's at all arguable that unions--at least American unions--are detrimental to the health of the businesses their employees work for.

Fundamentally, these unions are parasitic. They treat the wealth of its host as a given and find ways to extract more of that wealth. The flaw behind this is that the wealth of a company is not a given--it depends upon the customers, and the more you try to extract wealth from the company, the greater the impact on the customer. Either that, or the company just goes flat broke[1]. A company that doesn't have these additional costs and distractions is more able to focus on the customer, or at the very least can do just as good a job without going flat broke. The experience of US automakers vs foreign competitors, or Boeing vs Airbus, or unionized retail vs. Wal-Mart and Amazon, bears this out.

[1] If the company just goes flat broke, then the union isn't a problem per se, just a con game on shareholders. Airlines are an example: http://philip.greenspun.com/flying/unions-and-airlines


Unions are simply a balancing force to that of the management whose sole purpose is to extract as much profit from the enterprise. Yes, a lot of bad things can happen when unions gain too much power. But that doesn't mean unions are necessarily evil. On the contrary, they are a necessary evil, as a balancing force of the evil of the profit incentive.

The free market generally does not have the power to correct for overreaching management. In many cases the signal necessary to make a judgement is not propagated to consumers, at least not in such a way that it will cause a change in consumers purchasing decisions. This is where unions are necessary to correct against overbearing and unrealistic management. Society is stronger, and the economy is stronger, when the "wealth" of a nation is well distributed among everyone. Wealth here being everything from health, leisure time, assurances against bodily injury, etc. Unions are but one tool to ensure this equitable distribution.


> Unions are simply a balancing force to that of the management whose sole purpose is to extract as much profit from the enterprise.

You say "profit" like it's a bad thing. It's not, it's what funds new good things. And, reducing costs is a good thing. It produces "more".

BTW - Management's goal is to extract as much profit for managers, not for the enterprise.

One big problem with the corporate model is that no one has a long term interest. No one at GM ever got fired for agreeing to the contracts that broke the company. Instead, folks did get fired for not giving in.


Profit is "evil" here because it creates incentives for all sorts of bad things. This is what necessitates a balancing force.


> Profit is "evil" here because it creates incentives for all sorts of bad things. This is what necessitates a balancing force.

Even if that's true, unions aren't a balancing force to the "incentives for all sorts of bad things". The only role that unions will play here is in trying to get their cut.

Actually, that's wrong. Unions will often actively help commit said "bad things" because they'll benefit. For example, unions are often quite protectionist.


Of course there are many dimensions here. In some dimensions unions are "evil", in some they are "good". Everyone always loves to simplify things down to their pet ideology.


> Of course there are many dimensions here. In some dimensions unions are "evil", in some they are "good".

The question isn't whether unions are good or evil, it's whether they're actually a counter to a specific evil that companies might commit.

Since that evil produces more money for the company, you need an example where a union did something to reduce a company's profit other than by trying to increase the union's cut.

Unions are not new, so if you're going to suggest that they're useful for doing something, you should have actual examples of them doing said something.


Decreasing the company's profit doesn't necessarily equate to a union taking its "cut" (of the profits). Think reduced hours, more vacation, sick leave, less hazardous environment. Here the union is a check against a corporation's motive to sacrifice work environment for profit.


> Think reduced hours, more vacation, sick leave, less hazardous environment.

All of those things are the union (members) taking more of the profit.

"work environment" (as you're using it) isn't some abstract good that the unions are protecting. It's "what do I have to do for the money I make?"

Changing that balance one way is reducing the union members' take. Changing it the other way is increasing the union members' take, that is, trying to reduce a company's profit by increasing the union members' share of the revenue.

We're still waiting for "an example where a union did something to reduce a company's profit other than by trying to increase the union's cut."


Not sure why you're trying to be snarky. I was clear that I meant "profit" in terms of money. I clarified my point by listing the ways unions benefit their members. If you consider work environment, etc as part of "profit", then so be it. Nitpicking on minutia (definition of clearly defined words) is a waste of everyone's time.

>The question isn't whether unions are good or evil, it's whether they're actually a counter to a specific evil that companies might commit.

The specific evil being detrimental work environment, its obvious that unions are a balancing for to that.


> Not sure why you're trying to be snarky.

I'm not trying to be snarky. I'm trying to point out that your thinking is muddled.

> I was clear that I meant "profit" in terms of money.

And the things that you listed were benefits received by union members, benefits that cost money, which reduces profit. What do you think the same money for less work is?

> clarified my point by listing the ways unions benefit their members.

No one is suggesting that unions don't benefit their members. Your claim was that unions were combatting some evils. I asked for an example, and you started ranting about profits, so I pointed out that the only effect that unions have on profits is to increase expenses that directly benefit their members.

> If you consider work environment, etc as part of "profit

Work environment is expense. Profit is revenue - expense. Which statement do you disagree with?

Some work environment details affect quality and/or productivity and some don't. Of the former, some provide more increased revenue than their costs while others don't.

Do you really want to argue that unions only ask for work environment and compensation things that "pay for themselves"? (Given your model of management, unions don't have to ask for those things.)

If you've got examples of unions acting other than in their own self-interest, let's see them instead of vague theories.

How can you be so certain that unions act a certain way yet not have any examples?


I honestly have no idea what you're ranting about at this point. It's hard to have a discussion when your bias distorts everything I say.

>Work environment is expense. Profit is revenue - expense. Which statement do you disagree with?

I have no problem with the definition of "profit" you used, I already made this clear. All that matters is that we're on the same page.

>No one is suggesting that unions don't benefit their members. Your claim was that unions were combatting some evils

I clearly defined what "evil" I spoke of that unions are a balancing force against--"overbearing" management. Things like dangerous work environments, extreme work hours, lack of health insurance, etc. It is clear that unions are a balancing force to this "evil". If you disagree with this, then provide an argument. This is the only point I've made. I never claimed that this wasn't in the self-interest of its members. Your points are completely tangential to anything I've said.


> Society is stronger, and the economy is stronger, when the "wealth" of a nation is well distributed among everyone. Wealth here being everything from health, leisure time, assurances against bodily injury, etc. Unions are but one tool to ensure this equitable distribution.

I'll agree with that, but I think regulation and Big Government™ are a better solution and unions have outlived their usefulness. You can tell because most people who advocate for unions just rest on past glories.


I can agree with your point. Government perhaps is smarter and better equipped to deal with these types of issues than it was in the past when unions were necessary. The follow up question to this is: how did Government become smarter about labor issues? Was it unions that brought these issues to mainstream attention? If we do away unions, who could adequately fill this role? Unions are special because they have direct access to information that is generally lost to anyone outside of the company's walls. Any entity that filled the role of watchdog would need access to this information.


Freelancers union is a new phenomena... And the fact that it is formed by independent workers.. tells you about the need for this associations.


>balancing force of the evil of the profit incentive.

Seriously, you need to work on your language and mindset if you think profit is evil.

Profit is just a surplus of outputs for inputs given. It's what makes people get out of bed in the morning. It is most definitely not evil.


Oh come on. I was hoping it was clear that I was using the word "evil" as generic label for the negative side of any dichotomy. I don't personally believe in actual evil anyways (does anyone?).


The free market generally does not have the power to correct for overreaching management.

Can you explain this claim? Specifically, why "overreaching management" is bad for consumers, and why the market can't correct for it?


I don't personally believe that overreaching management is necessarily bad for consumers. I was just trying to preempt what seemed to be a logical reply given philwelch's previous comments.

As to why the market won't necessarily correct for it, is because many times overreaching management is effective (at least in the short term). Degrade working conditions to cut costs and the consumer benefits. The information about how these lower prices were brought to the consumer is usually lost in the process. That signal simply doesn't reach all interested parties, and thus they aren't able to adjust their behavior in response. Some situations it can work, for example a business where customer service is a large part of the experience. The signal of overreaching management does eventually filter down to the consumer.


Most likely the information doesn't reach the consumer because the typical consumer doesn't care.

There are often niche producers who target the small fraction of consumers who care, and market their wares in part based on this. For example, see Fair Trade coffee producers (appealing to do-gooders) or American Apparel (appealing to US nationalists).

Your claim that markets can't transmit this information to interested consumers seems incorrect.


> That signal simply doesn't reach all interested parties,

Sure it does. I, the customer, see both the price and the service. If I'm willing to pay more for more service, I can do so.

And, this signal also reaches the employees as well. If you don't like it, go elsewhere. If you're right about how valuable your service is, customers will make the same choice. If you're wrong....


What about products that have no aspect of customer service, say canned tuna? The point is that there are classes of products with no meaningful level of customer service to the final consumer. Or, any consideration of service is trumped by lower cost. In both of these cases the market will not correct for overbearing management.


"If there's two supermarkets in town and one is unionized, the other one will probably be better for the customer in some way, usually because they'll have lower prices."

This does not at all correspond to my experience.


What do you mean by "will probably be better?" I have to think there's plenty of real-world evidence to obviate that hedge by now.


> But a company that's flourishing customerwise can still have rapacious or simply bad management.

If true, so what?

You're assuming that this undefined "good management" has value that isn't reflected in the customer experience. That's simply not true. Even if the bad management only directly affects employees, they affect customers. (Good employees leave unless shackled by seniority rules, which is the only rational way to run a union.)


Jason Fried's article feels a bit preachy TBH, and the last paragraph about the cleaning lady being so awesome, seems rather cliched/trite.

I'm sure he's trying to tell us he values the little-guy/gal. Great!, we do too, but then don't pretend her job is more exciting than a whole industry, and you're just sitting around in gushy anticipation of your fresh flowers. ugh :p

Also, painting the valley as "sick" and "disgusting", feels one sided.

Sure there are problems with some startups being over-hyped, but bubble or not, companies are getting real shit done here, and it's pretty unique place, simply in terms of raw tech innovation density. Giving credit where due, doesn't need to take away from all the rest of the good stuff that goes on elsewhere in the world too, like at 37 Signals, Chicago IL.


It is all true, but honestly I don't think Jason's advise on running a company can apply for startups. As per Steve Blank startups are enterprises which are in search of scalable and profitable business model, so for many startups it is really race against time.


He seems to forget that he's not in the same business as startups are; he's viewing startups through a small business lens.

see the sickness in our industry

He's not in "our" industry. He runs a small business that makes good money, and it happens to use technology. Not the same thing.

Are you profitable? Are you building something great?

These are not always relevant questions for a startup, depending on what phase of its life it's in. You certainly try to build something great—or better yet, solve a problem!—but you may very well have to change (yes, I mean "pivot"). See Inside the Tornado for info about having to not worry about treating customers well at some stages.

I'm not sure I'd call any of 37 Signals' services all that great, however, if by "great" we mean innovative. There's nothing special about them except that they were there early and they're simple. But that's not what I'd call innovation, and I don't think it makes them great. I think his cocky attitude has a lot to do with the constant feedback loop in the town he lives in. In SV, I don't see many founders praised for judging other people's work; usually, they're too busy trying to build something truly great, even if it's yet another photo-sharing site. Hell, Flickr was just another photo-sharing site, but I think of that as far, far greater than something like Basecamp.


  > He runs a small business that makes good money, and it
  > happens to use technology. Not the same thing.
As opposed to what? Having no business (making no money), hyping everything out of proportion and having technology for technology's sake?

  > if by "great" we mean innovative
Any justification for this lame definition? I call the service great if it is really useful for customers and make money for the owners. Sure, inventing a way to put pants on over your head may be innovative, but how it is great and what's the point?

I got pretty tired of all that useless social hypeware with no purpose (other than burn VC's money) and business model.


I think you're missing the point.

> He's not in "our" industry. He runs a small business that makes good money, and it happens to use technology. Not the same thing.

I presume you're defining "our" industry as consumer focused Internet services that plan to IPO or get acquired? Not sure everyone would agree with you, I don't.

Your comment actually reiterates what he's talking about. The mentality of what a "startup" is and how you go about building it is (in his opinion) a bit toxic.

To tell you the truth, the longer I live in Silicon Valley the more I agree with his point of view.


I have to agree. I read your parent comment, and I just realized what bothers me about "startups", and how they operate.

I guess I had naively been assuming that a "startup" was effectively a phase in business, where you are working hard to build a product early in the businesses life. You are "starting up." However, I assumed that the end goal is to make sure that product grows and supports a viable business that enriches customers lives and provides a stable business for the people involved to do what they love.

Reading Sabats comment though, it sounds like his definition of a startup doesn't involve starting a small business. If it doesn't, then what are you doing? I have some things in mind, but I leave the question open to others to fill in.


I've been thinking about this for a while.

The biggest problem in Silicon Valley is that people don't think about what they're building. There are so many stories of founders receiving millions in funding and startups being acquired for tens or hundreds of millions of dollars that it creates a really unique subculture.

That subculture is what Jason Fried is referring to. I don't have a problem with it per se but I do wish everyone here would stop and ask "is this the best way to create value for customers?".

There's a lot of talk here about changing the world and delighting customers but if you look deep into most of these venture backed companies it is strictly about big exits. It's what the VCs want, what the media hypes and what founders (blindly?) follow.


I hate to be pedantic, and I don't want to take this thread off topic, but IPO is a noun, not a verb. It stands for initial public offering, and I'd prefer if people claiming to be in the know could use it properly. Please don't misuse simple terminology, as it promotes misuse by the younger people who would like to create companies.


IPO has been verbed for at least 15 years in Silicon Valley. Probably longer.

Your statement is both pedantic and incorrect.


I simply disagree that because some people decided to misuse a term, it is now appropriate. I think the use of IPO as a verb was done to sound sophisticated (and legitimate) and exciting, without understanding what SOX compliance involves. It seems to me that the only reason one would say "IPO" as a verb rather than "go public" would be to demonstrate some familiarity with jargon and gain some credibility among amateurs.

I may be a bit off, or poor in my ability to communicate my point, but it it seems you are appealing to authority in your argument for the use of IPO as a verb.


That's just how language works.

My anecdotal evidence dates back to Netscape, so 1995. Shortly thereafter, the Valley was deluged by people with limited knowledge of financial markets who might have been reaching for the faux sophistication you describe, but this was before all that (and long before SOX). Bankers still usually got it right back then, but they didn't do most of the talking.

Anyway, I'm all for pedantry. I do take issue with your assertion that inappropriately verbing the acronym will hold younger entrepreneurs back in some way. I do not believe it.

It seems to me that you might have some special reverence for the term. Fair enough. Surely you've seen this happen before though, to lesser words?


I agree with you in principle but pragmatically disagree. For better or worse the cultural usage of words and terms define what's appropriate.


Similar to Google which is commonly used as a verb.


>I think his cocky attitude has a lot to do with the constant feedback loop in the town he lives in.

Pot, meet kettle.


> Actually, my cleaning lady, for example, she’s great.

There's something a bit... I don't know quite how to put it. Let's just say that I bet she'd willingly trade places with him, cash out, and go enjoy herself instead of cleaning up after other people day in and day out. (Edit to change the wording just a bit)

> The other interesting thing about restaurants is you could have a dozen Italian restaurants in the city and they can all be successful. It’s not like in the tech world, where everyone wants to beat each other up, and there’s one winner.

That's because the economics of a highly local business are very different from one that can have customers all over the world.

Also: restaurants fail all the time - it's a stressful business to be in, and not generally the sort of relaxed, easy-going picture he makes it sound like. You can bet that most restaurants do not have the option of doing 4 days a week, unless they have big margins the other days, which means they probably have something very special about them.

I admire and respect those guys, but there's something too glib about some of their communications that turns my cynic sense on.

Edit: furthermore... live and let live, no? I'm more interested in a 37 signals style business myself, but let the people in Silicon Valley do their thing even if it doesn't float your boat. It'll all work out. As one example, I think the world is better off with PG running Y Combinator instead of having slogged on with Viaweb.


> There's something a bit... I don't know quite how to put it. Let's just say that I bet she'd willingly trade places with him, cash out, and go enjoy herself instead of cleaning up after other people day in and day out.

See, the typical problem with claims like Fried made is that they're idealizing lives they don't know much about. But Fried didn't walk into that trap.

He doesn't remark on her home life. He doesn't remark on her happiness. He doesn't remark on her hopes and dreams. He says she's "respectful, nice, and awesome". His point is that her business is sustainable, adds value, and does good. He doesn't say, "I wish I was a cleaning lady." All he says is that her business model is a good business model, and he's inspired by it.


"All he says is that her business model is a good business model, and he's inspired by it."

He says:

"She’s been doing it some twenty-odd years, and that’s just an incredible success story. To me that’s far more interesting"

I have absolutely no idea why he feels that someone who has cleaned homes for 20 years is an incredible success story. It's almost as patronizing as it is naive.

What would be at least somewhat interesting is if she figured out a way to get paid 2x the hourly rate and/or get houses cleaned in 1/2 the time. Her station in life is to be happy cleaning homes. So she's a happy person. Great. What I'm not hearing is that he's living in her neighborhood or having her over for dinner etc. I hate this "I'm just a simple person let me go visit an ashram and live in nature" crap.


> I have absolutely no idea why he feels that someone who has cleaned homes for 20 years is an incredible success story. It's almost as patronizing as it is naive.

Project much?

> What would be at least somewhat interesting is if she figured out a way to get paid 2x the hourly rate and/or get houses cleaned in 1/2 the time.

How do you know that she hasn't?

He says that she's happy. He doesn't know much about how it makes happy or how it has developed. You think that you do and you think that she's doing it wrong....


"Project much?"

Guilty as charged.

"How do you know that she hasn't?"

Well then that's a pox on his house for not bringing up that very important point in a discussion related to how much he admires her when discussing business.

"You think that you do and you think that she's doing it wrong...."

My issue isn't at all with the cleaning lady. It's with the specific example of using the cleaning lady to make this point:

"She’s been doing it some twenty-odd years, and that’s just an incredible success story. To me that’s far more interesting than a tech company"

I don't even think he really means that actually. I fail to see what makes that "far more interesting than a tech company".


I don't really think we can get anywhere with speculation: he might see her happy because people are pretty good at putting on a mask in professional situations. Or maybe she just really is happy.

However, in the aggregate, I'd be willing to bet on most cleaning people preferring the income, and freedom that 37 signals have. With that kind of money, you have a lot of options that someone making cleaning wages just doesn't have.


"Or maybe she just really is happy."

Not speaking about this person (who neither of us know) but strictly about people in general by using an example of cows in a field.

A cow in a field can stand there all day and just graze on grass. Our cat can sit there all day and just do nothing. Could you do that? All day, every day?

People with brains are more complex. In general if she is happy doing cleaning work we can presume she doesn't have the same brain or needs, of, say someone with higher intelligence. People are different in what their needs are.

"he might see her happy because people are pretty good at putting on a mask in professional situations."

True.


> People with brains are more complex. In general if she is happy doing cleaning work we can presume she doesn't have the same brain or needs, of, say someone with higher intelligence. People are different in what their needs are.

That's almost as patronizing as it is naive.


Well ok then what are you basing your thoughts on? I'm basing mine on a lifetime of meeting thousands of people from all walks of life and the story as presented by the OP.

I stand behind what I have said.

Would you be happy doing the simple tasks of cleaning houses everyday? Or do you prefer something more challenging like what you are doing (software development it appears). Or at least managing others doing the drudge work?

From the OP it doesn't appear that we are talking about someone making their way to something greater by cleaning houses but somebody who's station in life is cleaning houses.

Regardless of whether she was forced to clean houses because, for example, she was an immigrant or needed to feed a family she could have, with greater intelligence, risen to employ others to do the work for her at the very least. (My cleaning lady, from Brazil, has about 5 people working for her and I've seen examples of this with all sorts of people who start doing a task and rise to employ at least a few people to help out).


> From the OP it doesn't appear that we are talking about someone making their way to something greater by cleaning houses but somebody who's station in life is cleaning houses.

Why do you have this mindless obsession with ranking things in some arbitrary manner and then requiring that people climb your ladder?


His point was that it is a sustainable business, which is not something that can be said of most Silicon Valley startups (in his opinion).


"it is a sustainable business"

If you set your sites low enough you can have a sustainable business. You can mow lawns or you can paint houses. That's being self employed with essentially what amounts to a job. That would be appropriate to talk about in a post about why it's better to do that rather than work for a large company.


Her business model is providing a service: exchanging her time for money.

37signals used to be in that business, but moved towards providing products, rather than services. Presumably because it scales better and makes more money, even though doing design/programming/sites certainly makes good money in a sustainable way.


Is Google Search a "product" or a "service"?


Unless Google has legions of Oompa Loompas hiding in its server rooms running around retrieving data as queries come in, it's a product that provides a service: it does not scale linearly with the number of people working on it.

Put another way: each additional cleaning lady client consumes more of her time, and pays her more money in a fairly linear way. Google search users do not fit that pattern, and, more importantly, neither do Adwords customers.


You realize that there exist more than two business models in the whole of the world, right?

Where do you get this strange taxonomy of "products" versus "services" anyways?


You're being needlessly pedantic.

It's pretty obvious that by "service" he means a business where you are paid per hour you work: all freelancers, consultants, and all other businesses where the owner is a critical daily employee.

Yes, that's not a typical word for the distinction, but you know what he means.


> You're being needlessly pedantic.

Um, no. I was being exactly as pedantic as he was.

The difference was that my word choice was actually correct.


Do you understand what I am trying to communicate, or not?

It does not seem like a difficult concept, so cut out the "Comic Book Guy" routine. Go ahead and actually correct my terminology if you care to - furthering everyone's knowledge is always a plus - but otherwise you are not adding anything.


No, I don't.

As far as I can tell, you were trying to use made-up words to say that Jason Fried was lying when he said he was inspired by his cleaning lady's business model because there was some particular difference between those two business models that you found significant but could not express except to vapidly define "services" as "that which cleaning ladies do" and "products" as "that which 37s is moving towards".


Woah: I never called anyone a liar.

Product business and service business are fairly common labels.

http://swombat.com/2011/4/26/services-products

http://techcrunch.com/2011/04/24/what-should-you-do-with-you...

So I don't think they're made up at all, seeing as how they're in common use. It's probably true that there is not a black or white line between the two, and both can be good businesses, but I did think it fair to point out that cleaning is very much a "service" whereas 37 signals started out doing services (sites and so on) and moved towards products, which tend to scale up more.


It's less than not-typical, it's just wrong.


Go easy on him, it's only the second week of the semester.


This comment is needlessly mean and dismissive and doesn't belong on HN.


> There's something a bit... I don't know quite how to put it. Let's just say that I bet she'd willingly trade places with him, cash out, and go enjoy herself instead of cleaning up other people's crap day in and day out.

My mother isn't a cleaner (she's a nurse) but I talked with her before about whether or not if she had the chance she would quit her job and sit on the beach all day doing whatever she wanted and she said that no, she would never be able to stop working because it has been a part of her entire life and if she was going to quit her job and do anything she would open a book shop (I think it was a book shop).

I think for a lot of people work is a part of who they are and it's not as simple as just taking money and spending life on a beach, I'm sure the cleaner would love financial freedom but I would suspect she would keep working. For a lot of people they don't have things they enjoy that have some sort of output (for most of HN that's programming, or design) so working is all they have to feel like they have value in the world.

Maybe his cleaner has financial freedom already (saving, inheritance etc) and chooses to work.


I can't stand going to the beach myself, and if I were wealthy, would see myself continuing to work on things. I'd probably have more 'projects' though, things where there might not be any way of making money off it. And I sure as hell would be spending a lot more time riding my bicycle instead of getting fat sitting at a desk.

To each his own, but would someone really want to keep cleaning professionally even if they were wealthy? I could easily seeing less-than-profitable but creative hobbies being way more interesting for hypothetical cleaners who were wealthy and wanted to stay busy.

The reality though, is that unless the cleaning lady is good at hiring and managing other cleaners, she's never going to get the chance to cash out, or sell the company or any of the other avenues the 37 signals guys have.


> To each his own, but would someone really want to keep cleaning professionally even if they were wealthy? I could easily seeing less-than-profitable but creative hobbies being way more interesting for hypothetical cleaners who were wealthy and wanted to stay busy.

I felt the same way until I actually met a wealthy cleaner. All I can say is never underestimate the power of habit and the difficulty of breaking routines.

I used to intern at a small investment manager years ago where one of the clients was a cleaning lady. Every couple weeks she would come into the office to deposit a portion of her modest housecleaning income into her investment account. I didn't think much of it until I found out she was actually a multi-millionaire. This cleaner had been investing with the investment manager for years and (at ~20% annual returns) her small contributions compounded into millions of dollars. It was pretty mind blowing. Why didn't she just retire!? She just loved her job and the routine...

Anyway, the best part is she refers her high net worth customers all the time to the fund and they all sheepishly try to explain how they heard about the fund from their cleaning lady. Little did they know that their house cleaner was actually richer than them.


Cute story, but I'd put money on people doing cleaning work, statistically, being happier doing their hobby rather than cleaning.

Not all cleaning people work for investment managers that cut them in on sweet deals. Truth be told, I would guess that those are probably a minority.


I'd put money on most cleaners not having hobbies =) (Sorry couldn't help myself...I come from a family of very blue collar folks and it's a running joke that your hobby is sleep)

My main point is it's hard to break years of routine/habit. If someone has done the same thing for 20 years, I don't expect them to suddenly change. Even when change would bring greater happiness over the long-term, I'm not betting against the comfort of status quo.


You are probably on to something with the lack of "retirement" (US, business and academia). Also, the change may lead to less happiness, from breaking such a long-term "routine" (I would say "life").


It seems like with enough time we become institutionalized to a certain way of life and will reshape our happiness to fit perfectly to that world.

Oddly, first time I saw the world this way was after watching Shawshank Redemption as a kid and seeing Brooks killing himself after he was freed. From that point on, a lot of the seemingly irrational decisions people make made a lot more sense to me.


Running a book shop with your FU money is completely different from running a book shop to put food onnthr table.


"There's something a bit... I don't know quite how to put it."

Let me help you. But first I have to get my shovel. Because that's the typical shit that is heaved by the "haves" on the "have not's" try and make them seem humble and not anything special. Take Oprah. She just loves to talk about how this and that are so expensive as if she's just an ordinary person like the rest of us. He laid it on a little to thick with the cleaning lady spiel.

Particularly this part about the cleaning lady:

"she’s just respectful and nice and awesome. Why can’t more people be like that? "

Well for one thing he could start and figure out why in particular DHH is such a, well, asshole:

From wikipedia:

"Hansson is an outspoken character known for the crude and brutal way he expresses his opinions, both online and in real life. Hansson and his company have been accused of arrogance,[7][8][9], which he does not deny"

And of course I can't believe the example of why restaurants last 30 years (the ones that do that is) and tech companies don't last or whatever the point he was making.

Why not just compare cars which change every year vs. a burberry coat which is essentially the same?


Calling people names is not really ok with the spirit or guidelines of Hacker News: if that's not something you'd say to DHH (who often pops in to comment here) in person, you shouldn't be writing it.


Ok, I agree with that because I haven't had any personal interactions with DHH and only know from what I have read about him or in his comments. So it was inappropriate. But I still feel the point I am making is valid as far as Jason's thoughts juxtaposed against DHH's apparent behavior. The truth is DHH appears to be a prima donna.

It is interesting how DHH thought seems to get a pass on his behavior on HN in a "boys will be boys" kind of way because what he has accomplished.


"To me that’s far more interesting than a tech company that’s hiring a bunch of people, just got their fourth round of financing for 12 million dollars, and they’re still losing money. That’s what everyone talks about as being exciting, but I think that’s an absolutely disgusting scenario when it comes to business."

Hilarious given that Jason Fried was on the board of directors of Groupon (his comments on this "disgusting scenario" here: http://news.ycombinator.com/item?id=2617160).


Jason made it pretty clear that he was joining the Groupon board:

  * as a personal favor to Andrew Mason
  * to get some board experience 
He emphasized:

  * he had not changed his stance on bootstrapping companies
  * his board involvement was not an endorsement of groupon
  * he sold his shares when given the chance
So I guess I'm missing the hilarity, other than seeing you try to pick another fight with Jason Fried.


Thanks for bullet pointing, was going to do the same thing.

I wish people would at least read the link they paste, if they intend to use it for their arguments. The link answered/refuted his own 'claims'.


I sort of agree with this...

However, the saying "If you lay down with dogs, then you get up with fleas" still applies. Even if you publicly disavow the fleas.


Andrew Mason is generally not considered a very upstanding CEO. Why is Fried giving Mason personal favors? Are they cousins?


I did some consulting for Andrew and can say that he's actually a REALLY decent guy who cares about his team and customers. Certainly there were times where Groupon was downright sloppy. And perhaps they were reckless. But can you point out where Andrew wasn't upstanding?


Just a year and a half ago Andrew Mason was actually considered one of the most charismatic CEOs in the business. GroupOn had MASSIVE momentum, and was actually known as the fastest growing company in history.

Fried was on GroupOn's board way before any of the investment scandals came up.


Maybe Mason did Fried a favor. That's usually how it works.


I don't know if it's really that odd. Jason's feelings about the way a company should be run may have been at odds with the way Groupon was run. However, that wasn't what Andrew asked Jason to provide guidance on.


The problem is that Jason uses superlatives and buzz words in this interview and elsewhere. Either they just are marketing fluff for his "sustainable" (i.e. buzz word-laden) business, or he actually believes them.

However, if he actually believes them, and if Groupon really is "absolutely disgusting," why would have he not only given advice but retained shares in in the company? Personally, I don't even give free advice to things I think are "absolutely disgusting" unless it is to clean up before talking to me, and I'm not sure why we should expect anything different from Jason.

Like I said, I'm open to the idea that Jason is simply exaggerating to set his "slow company" apart from the pack, but if I'm going to write a critique it is going to have to be with the words on the page, not my idea of what is going on in Jason's head.

edit: will accept a third possibility, that Jason's ideas have grown stronger as he has witnessed Groupon from the inside.

2nd edit: "invested" -> "retained shares in"


"why would have he not only given advice but invested in the company"

First, let's get your facts straight: I have not invested a penny in Groupon. I haven't put any personal money into any private company other than my own. I was awarded options as compensation for participating on the board, just as other board members were.

Why did I give them advice? Because they asked me for it and I thought I could help. A lot of people ask me for advice, and i'm happy to help where I can. I don't have to agree with someone on everything to give them advice. I like Andrew, he asked me to help him, I wanted to help him, I'd never served on a board before, so it sounded like a great learning experience. It was - I don't regret the experience at all.

Andrew knew where I stood - and where I stand - on VC, investments, growing quickly, hiring a bunch of people, etc. He was interested in my perspective on product, design, and user experience, not on financing, growth, etc.

I was asked to leave the board in 2010.


^ is what I love about HN.

Is it better to stand by and let them get on with it, or to join them and provide a different opinion? A counterbalance?

I'm in the second camp; work with people, spread your ideas. Give it a try.

Of course I'm also of the opinion that, at board level, it's healthy to have a range of opinions. Only then can you make informed and reasonable decisions.

For the observant (or the fellow Hollanders), we call it the Polder Model (http://en.wikipedia.org/wiki/Polder_Model).


> at board level, it's healthy to have a range of opinions

This is very true... perhaps its one reason why Groupon is struggling so much. Without knowing the board dynamics, its impossible to say, but if I was in their position, I'd want people on the board criticizing every move. So long as it wasn't a majority of the board that is...


I thought your prior response (linked to by the comment that started this digression; "453 days ago") was sensible and sufficient. But thanks for chiming in again and definitively.


I am having a hard time following this comment. Are you suggesting that Jason Fried doesn't run 37signals in the manner he's talking about here? If so, then on information & belief, you're wrong.

If you're just saying that you think owning equity in a company not run the way he runs his own company undercuts everything he writes... ok, but what a boring objection to raise.


A board seat is a lot different from just holding equity. I own HPQ, RIMM, and YHOO, and if I had a board seat in any, my push would be for sale and getting rid of everyone above the first layer of management and engineers. (Boardmembers can't do this directly, but can work with shareholders and management, and ultimately hire competent CEOs)


And? It's not like we have to read tea leaves out of his board memberships to see how Jason Fried runs a business. He runs a famous business himself.


It gives an unwarranted endorsement to GRPN; their business practices are fairly reprehensible, so if a marginal investor or marginal small business customer gets screwed because a well respected guy lent credibility to their board, it's a poor choice for him.


Do you really believe any of this comment? You're a pretty smart guy. I don't believe you think anyone reads this article and thinks Fried is saying Groupon runs that way, or that Fried is in any way endorsing how Groupon is run.

I know this is a message board and we're all committing message board thinking, but snap out of it for just a second.

We're talking about a real person --- a person who by the way is posting on this very thread --- who runs a real business. From what I've seen of that business, it runs, successfully, the way he describes it. I wish we'd stop talking as if Fried was Chairman Mao and we're really debating global communism.


Not based on the article at all -- just the general argument of "someone holding a board seat at a company is more of an endorsement than merely owning stock". There are people I respect who have board seats at really dysfunctional big tech companies, too, so maybe the argument doesn't work.

He's a great CEO (at least in the context of 37 Signals), and has a set of values which are internally consistent, and sits on a board of a company which is inconsistent with those values. I'm not sure how to reconcile this with my belief that boardmembers have a responsibility to exert governance and oversight over their companies.

Based on reading his responses elsewhere in the thread (left the board in 2010, was his first board seat, novelty, etc.), it makes more sense. I guess I am overly sensitized to passive board members from watching HP, Yahoo!, eBay, RIMM, etc.


He does not sit on the board of Groupon and hasn't for a long time.


Right -- so this whole thread is essentially people trying to troll him, which I didn't understand until reading the rest of the context and postings on other 37S articles. (and Groupon early days was fine). I assumed it was brought up because it was relevant to now.


Simple version: If he thinks and thought the Groupon scenario is "absolutely disgusting" why did he advise, take a board position, and retain shares in an "absolutely disgusting" venture?

Options presented by me:

A) "absolutely disgusting" is an exaggeration

B) JF is a hypocrite

C) JF has changed his mind over time


You're just a little obsessed with parsing his every word. Maybe he did find Groupon's growth absolutely disgusting. Maybe he didn't. Either way, he was asked to participate and give advice, which is what he did. One can do that and not be thrilled with everything going on. We're not talking about criminal activity here, just one of many ways to run a business.


A bit confused why downmodded for responding to a request for clarification with a clarification. If you don't like the original post, isn't downmodding that enough for you?


He didn't invest in the company. He was granted shares. He sold them at his first chance.

Thing is Jason is all about living the good life not being rich. Good life != rich. He was doing well for himself before Basecamp and Basecamp was just part of his strategy to manage his own work more effectively so he would have time for stuff that is actually better than coding or designing - like spending time with family or driving race cars a la DHH.


"why would have he not only given advice but invested in the company?"

On the link you posted he mentioned that he hasn't invested on the company, and that the options he sold were ones he received as compensation for his work on the board.


I think you're overestimating the influence of board members. You can judge him based on how he runs his company, not how he participates on one company's board. That's "do as I do."


Congratulations, you brought up JF's Groupon involvement the fastest on this 37Signals link. Well done.


It's relevant.


Apparently raising $950M in your fourth round is two orders of magnitude more "interesting" that $12m. Losses notwitstanding. ;)

But all jokes aside, its not uncommon to have BOD compositions of mixed expertise. Having a design or product guy. A Politician, etc. As a group, they need to be effective. But singling out one individual, for "guilt by association" is perhaps stretching a bit. (edit: Unless he was on the audit comittee!)

The fact that he sold his shares, in some ways, also not per-se a bad sign if it reflected his views (it became public information). This is signalling to the public, and seems consistent with his other expressed opinions.


Groupon actually pivoted to cater to small business management now that I think about it. This dosen't mean they were successful at it, but I wonder whether Jason had anything to do with that. Groupon might be able to recover and survive as a company but I don't think the VC's will make it with a big return.


Do as I say, not as I do.

Ego has this astonishing effect of completely bending[1] the space-time-reality fabric of the universe.

1. Or ripping it apart, depending on how well off you've become and how many sports cars you've bought.


37signals does not reap millions of dollars of VC investment to staff up huge numbers of people while running their business in the red. But a reader of your comment would be left to wonder whether they do, because you wrote it carelessly.


I can't speak for Jason or comment on his involvement on the board of Groupon, but he does do as he says within 37signals.


>Do as I say, not as I do.

Which is mighty fine.

I'f I'm telling you to be good and I'm bad, them I'm a hypocrite.

That doesn't mean that my advice is bad, or that you shouldn't follow it.

Follow an advice (or not) by the intrinsic value of it, not by who the one giving it is or what he does.


That sounded pretty honest to me and didn't refute that quote.


Perhaps. But I don't think that invalidates what he's saying. The idea stands on its own.


If anything, that comment just confirms his consistency.


I've read a lot of Jason's stuff and he has a lot of insightful things to say about running a successful small technology business. He probably understands it about as well as anyone on earth.

The part of the rhetoric I'm not as fond of is this false dichotomy that he often raises of "either small business is right or big-startups are right". Both can be right--they just have different goals. And there are strong relationships and dependencies between each type that make it particularly disingenuous to slander each other.

It reminds me a bit of the "you didn't build that" hubbub happening in American politics lately. There seems to be a "I did this" hubris, as you create high-quality web services catering to small teams.

Let's get real: you are building web services consumed by a browser (Netscape) on someone's Macbook Pro (Apple); your data found its way there over some serious switching infrastructure (Cisco); you stock your offices with goods from the best online retailers--oh yeah, and they host a bunch of your bulk data too (Amazon); your site is indexed by the major search engines and you expose your brand to potential customers via sophisticated advertising networks (Google); your keep your friends and fans in the loop on what your business is up to via massive social networks (Twitter).

Many of these companies were ambitious, they had low probabilities of success, they had much higher capital needs and a tighter window to hit the market.. than a slightly better product management system for small teams. But these VC-powered longshots--the lucky few winners--now form the beating heart of our industry. They provide good jobs to hundreds of thousands of people. And.. would 37 signals even exist without them?

Jason wants to make great money and have a good business and take Friday off. That is fine, that is seriously great. I'm not sure why the tone is so defensive, b/c, really, who's attacking that? That's a damn good way to go.

But some people want to "make a dent in the world". They need some money to do that! And they might fail! And rich guys are willing to gamble on the outcome! Who cares? It's audacious fucking fun to try to change the world, and sometimes it works. Afterwards, we can take a shower and feel clean and wholesome about the birth of 38 signals.


I'm not sure why the tone is so defensive, b/c, really, who's attacking that?

My guess it is in response to some quarters not respecting "lifestyle business" startups. There ARE (or were) people attacking that.


When my Dad decided to start his own business his goal was to work for himself and make enough money to live comfortably. He's achieved that, he could push and try stretch it to the next level and make even more money and become more successful but he realised he's happy with the money he's got and not having to deal with anything extra.

When anyone starts a business you can shoot for living a nice comfortable life (and lets be honest if you're running a business making millions per year, you've nailed it), or you can push and push to become the business. Both have chance of failure, both require devotion. I'd take the same route as 37signals. Having enough money to live comfortably and enjoy life sound much better than the constant grind to get to the next boss level.


Why does this say: 'Its CEO's Model' when it should be 'Its CEO's Role Model'? Seems like the writer is baiting for clicks. It's a little misleading to me.


You can use "model" to mean an example to follow. For example, "37 signals was the model for my software business" or "she was a model employee."


Wow. It almost sounds like he runs his tech startup like a "real" company. Imagine that. ;-)


I think that 37signals has been in business since the late 90s, so I'm not sure I'd qualify a business that's been in business for 13+ years as a startup.


I like Steve Blank's definition of a Startup -- it's an enterprise set up to search for a profitable business model. 37signals is long past that.


It was never that to begin with. Fried wasn't trying to create an enterprise. He just wanted to own a small business. That's what he has.


An enterprise is not necessarily enterprisey.

Some enterprises are fictional starships.


So nice there are more and more companies which understand that keeping their employees in comfort is so essential for the long-term success. Giving more freedom and spare time, makes people more productive during work time. No stress, no pressure = more job done. I also admire companies, that have understood that a 6-hour working day, would be more productive than the 8-hour, since time for distraction is reduced to significantly.


I am in line with the thought process. Also, "There’s a great quote by a guy named Ricardo Semler, author of the book Maverick. He said that only two things grow for the sake of growth: businesses and tumors." funny and apt. I am striving to build a sustainable business, without going to VCs, providing tangible benefits to my customers, and without huge ambitions to become a billion dollar company (or even high millions)


Profits are without question important. Bootstrapping I'm not so sure about. There are many profitable companies today that were never bootstrapped, like Apple and Google and tons of others. I'd be concerned that bootstrapping in this day and age might limit how big a company you actually do become, esp since you are competing against entrenched players.


I can totally subscribe what Jason said here. One time someone said that I wasn't "startup" material because I wasn't open to work 80 hours per week. They said that like it was a bad thing :), fast forward a few years and their company is now dead and I'm now doing my own thing steady and profitable.


lifestyle businesses are great. but to make real money you need to scale -- I think this stuff is okay for the size of business they are aiming for but if you want to build something that can be acquired for 500m+ or IPO then you need to do some more strategic thinking.


Several million a year isn't 'real' money?


Absolutely amazing and a rare voice of reason in our industry. If only more companies would adopt this kind of mentality of building sustainable businesses.


This guy could have built the next Salesforce / google. but he eschewed hiring a sales team. He didn't want that, but still. Failing to achieve your true potential is not something to be bragging about all over the web.


I suppose he doesn't really have to prove anything to anyone. Not everyone wants to run a 10,000 or 50,000 employee company. Not everyone would be happy with the stress or bureaucracy involved.

Not to put too fine a point on it, but your attitude is exactly the kind of thing he's talking about in the linked interview. Mega growth and mega profits are one measure of success. A life with low stress and plenty of time for your family (and by the way, making all that possible for your employees, too) is another one.


I agree with what you. His style of running a business as likely maximized his personal happiness, and possibly his employees.

But I would have liked to see him say "we could have been far more profitable, but we didn't care about that, so we limited hours and didn't hire salespeople." Instead what I hear him saying is "we are the best business we could be, because we limit hours."


>> His style of running a business as likely maximized his personal happiness, and possibly his employees.

Rather than the main focus being happiness, I think the main focus is:

Are you building something great?

And he believes maximizing happiness and job satisfaction is a core component of achieving something great.


You have it reversed. Building something great is a component of happiness.


Is someone's "true potential" only reached when they chew up employees during 80 hour weeks? When they have a sales team that will do whatever it takes to land the sale including stretching the truth?

Is 'true potential' only evaluated based on attainment of maximum dollars per day of business? I don't see how he has failed anything but living up to your idea of achievement which, frankly, seems a lot more shallow then his.


Well it's pretty clear what he means, if you ask me: someone's true potential is only reached when a guy named Acne_Researcher says it is.


I felt that with their ideas, talent, and overall ability, they could have been a company useful to society as Google. Instead, they have focused on their niche and done very well. It was their choice to stay small and avoid greatness, and I don't criticize them for it, but I think that bragging about it all over the place is a little tasteless.


Maybe he's trying to paint a picture where everyone doesn't need to aspire to be the next Google. Different strokes.


You have feelings. That's great! Welcome to humanity.

Do you have logic? Data? A Delphic oracle? Perspectives into a parallel universe where they hired a sales team? Something more substantial than feelings?


Be nice, Michael.

37signals once built software I loved. Salesforce builds software I loath. 37signals could have been great -- a Salesforce with wonderful software -- but the CEO is happier to pat himself on the back and brag about laziness. That's my logic. Do you feel that I am incorrect?


> Do you feel that I am incorrect?

Yup. That's exactly how I feel. I don't know why you're bragging about your incorrectness all over the internet, though.


I can't tell for sure, but it seems like you all know each other outside of HN, and perhaps have a relationship that is unknown to the rest of us. I think it is better for you to keep these things to yourselves, and not involve this community.


No, this was not the case. My name is in my profile. He is, however, the first person who made the mistake of thinking it would help his cause to use it.


The company brings in several millions dollars a year [1]. They have one of the nicest offices in Chicago [2]. One of the partners had a super car commissioned a few years ago which on a technical level is more sophisticated than the machinery available to your average military [3]. So how aren't they "living up to their true potential"?

[1] From the article.

[2] http://37signals.com/svn/posts/2593-official-pictures-of-our...

[3] http://en.wikipedia.org/wiki/Pagani_Zonda#HH


Their true potential was to be a 50 billion dollar public company, in my opinion. I could be wrong. There are more important things in life than money, of course. But I felt they chose to leave too many chips on the table.


What are you exactly using to determine that in the city of Chicago "they have one of the nicest offices"? Impossible to say that from the pictures.

As far as the car goes, very little info on that and additionally you are drawing a conclusion as far as DHH's money which could have come from other sources as well as 37signals.


He built up his hill of customers and you're slagging him because he didn't strip-mine the local quarry to build it into a skyscraper/mountain?

I'd say it's equally likely that 37Signals could have failed utterly in rapid expansion as they could have succeeded if they made their moon-shot.


Good point. But I don't think hiring a sales team could have lead to a failed moon-shot attempt.


You could have built the next Salesforce, but unfortunately you wasted your time complaining on the internet about how extraordinarily succesful people have not 'lived up to their full potential'.

Everyone has infinite potential.


love the term "we are reaching Peak Talent". It think we are already there


Awesome


The long hours mostly has to do with the startup community. They get funding and VC wants to make a profit within a year and get out, at the expense of any long-term goals of the company.

The result is 70 or 80 hour work weeks and burnout. The VC don't care because they will be done in the short-term anyway.

It's the reason why I refuse to work for startups.


Startups don't have to be VC backed and don't have to work long hours. We aren't and we don't.


> VC wants to make a profit within a year

Typical returns take 5-7 years for a VC. < 1 year returns tend to be low.

You are presenting things you believe as facts. Please don't do that.


This isn't exclusive or indicative to startups. I have friends who work at large companies (Apple in particular) who work 90 hour work weeks and are completely miserable.


Your understanding of VC timetables is wrong. It's almost unheard of for a VC to book a profit within a year.


This company is not a startup; it's merely a successful small business.

the startup community ... get funding and VC wants to make a profit within a year and get out, at the expense of any long-term goals

This is not unheard of, but certainly not the norm. Successful VC firms invest of big growth, but over a longer term. Look at the huge VC-backed successes in SV (obvious examples like Google, LinkedIn) and you'll see anything but a build-it-and-flip-it mentality.


"merely a successful small business."

Really? That small business is financially more successful than most crazy ass VC backed startups with the latest photo sharing solution will ever be.

</rant>


In fairness, that still doesn't make it a startup.


I think after being in business for over a decade, 37signals is way past being called a startup.


No, it doesn't.

But who the hell cares?


Pray tell, what would make it a startup?


I know this'll be a controversial stance but IMHO.. needing to work 5 or 6 days a week to prove the business case, make the business stick, and to scale the business to a point where you have multiple employees and processes that allow you to only work 4 day weeks if you want.

Of course, some businesses can run on fewer hours from the start, but many require a lot of sweat and long hours to get the engine running.


They were a startup early on. I think it's safe to say they've transitioned out of that at this point, just as Google, Amazon, etc. have.


losing money


That small business is financially more successful

Sure. But they're not trying to build the same thing. I think it's mainly a midwestern attitude vs. Californian. Fried just wanted to build a business. Startup founders want to build companies.


Startup founders want to sell companies.


Wow, could we put the mythical "startup" on any more of a pedestal? '... merely a successful small business' as a diminutive to 37Signals? We've really jumped the shark here, haven't we?


> This company is not a startup; it's merely a successful small business.

Startup, n.: A small business that is not successful yet.




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