Dave Concannon


In Pure Water, No Fish

Apply for Your Own Job

Write a description of your current job including all the tasks and requirements of what you do every day. Then in a different column, list all the skills you use on a daily basis. Finally, compare the two columns – Is there anything missing from your job description that doesn’t have a corresponding skill? Is there anything in your skill set that doesn’t find a home somewhere in your job description?

  • If there are a lot of things in your job description that don’t have a matching skill then you probably need to get learning.
  • If there are more skills than responsibilities, maybe you need a new challenge?

Book Review: “Rework” by 37Signals

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I’ve been eagerly awaiting the arrival of “Rework” since I preordered it back in January. I’m a big fan of 37signal’s work, their blog, and loved David Heinemeier Hansson’s talk at FOWA Dublin in ‘09. I’m not a huge fan of “Rework”.


Before getting to the actual content of the book, the reader will be confronted by some of the most overly-enthusiastic praise from recognized industry figures that I can ever recall seeing in a publication. This almost stopped me from buying the book in the first place. Mark Cuban is someone I’d gladly sacrifice a major appendage to work for, but check out this effusive gibberish:

If given a choice between investing in someone who has read Rework or has an MBA, I’m investing in Rework every time… a must-read.

Or this mental breakdown from Tom Peters:

The clarity, even genius, of this book actually brought me to near tears on several occasions. Just bloody brilliant, that’s what.


37signals typically write in a blunt, straight-shooting style, and they pull no punches in “Rework”. Don’t get me wrong – there are a few gems, but also several essays which really don’t make any logical sense. One or two of the essays remind me of “The Sphinx” from the movie “Mystery Men” – amusing upon first read, but logically empty. In particular, the introduction sets up some weak straw-man arguments about what ‘conventional critics’ say is not possible that comes across sounding like teenage rebellion.

Getting Real” was a breath of fresh air in an industry that seemed to have learned little from the Dot Com crash. It was absolutely original and controversial when released, and inspired people around the world. At least part of the reason for the success of “Getting Real” was it’s contrarian stance on what was then normal industry practice – their advice to do less, avoid feature bloat, have passion for what you do, and their simple functional design theories were revolutionary.

The problems with success

It may be that they’ve actually been too successful at promoting their philosophy because for the most part “rework” doesn’t feel like it’s saying anything very unconventional. Here’s an (admittedly out of context) quote from the book that I found ironic:

When you’re a success, the pressure to maintain predictability and consistency builds. You get more conservative. It’s harder to take risks. That’s when things start to fossilize and change becomes difficult.

If you’ve been following resources like Andrew Warner’s interviews with entrepreneurs, or the surge of interest in concepts like the Lean Startups philosophy, a lot of the advice in this book just feels like common sense. Maybe I’m just not in the target demographic? It is to 37signals’ credit that they have inspired so many with their work and there is a lot of good advice for those who are not familiar with what they’ve already done, but some of “Rework” just doesn’t hold up to the light. It’s Seth Godin’s easy conversational writing style but missing some essential nugget of truth.

To make sure I’m not just whinging in this post I’ll clarify that there are the occasional diamonds in the rough. I particularly enjoyed:

  • Meetings are toxic – Good advice on how to run a meeting if it’s really necessary
  • Let your customer outgrow you - Don’t pander to every change request
  • Scratch your own itch – Solve one of your own problems and you’ll find a market
  • The myth of the overnight sensation – The only path to success is hard work
  • Marketing is not a department - Everyone is responsible for the public face of your company

Buy it?

My critical process for reading any article, blog post, or book is to ignore who the author is and concentrate on the actual content. In this instance I wasn’t overly impressed.  Let’s be honest though – this book is going to be a resounding success whether I praise it or slate it. 37signals have a very large audience among whom they’ve reached a certain level of rockstar infamy. If I can riff on this tenuous rockstar analogy – “Getting Real” is to the Red Hot Chili Peppers’ “Blood Sugar Sex Magik” as “Rework” is to whatever that last album was called.

With all the points above in mind, there is still enough good advice in this book that I would recommend getting a copy if you haven’t already read “Getting Real”, and don’t subscribe to their blog.  There are four of the better essays from the book on Tim Ferriss’s blog if you want a sampler to make up your mind.

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Resurrected Weekly Retweet – 12/03/2010

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The weekly retweet

I’ve resurrected some of the code that does this weekly retweet nonsense, it seems that some recent wordpress update strips any HTML characters when you post via XML-rpc and to disable it involves messing with the duct-tape and blutack internals of wordpress. I have better things to do.

Book Review: Business Model Generation

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Skipping the content for one moment, I’ll first say that this book is absolutely beautifully designed. The basic look has the sort of unique artistry of Dustin Curtis’ website, from the spacious layouts and excellent accompanying graphics to the lightly embossed cover. This wouldn’t look out of place on a business geek’s coffee table. Kudos to Alan Smith from The Movement.

On to the actual content. Alexander Osterwalder and Yves Pigneur (along with 470 or so co-creators) have put together a fantastic manual on how to map, analyze, and strip-down your business’s model and re-assemble it into something that really creates real value.  The starting point of the exercise is the Business Model Template which allows you to break your business down into:

  • Key Activities – What you do every day to make the model work
  • Key Partners – Your suppliers and partners that help you make the model work
  • Key Resources – The most important assets you used to create value
  • Cost Structure – All the costs involved in running the business
  • Customer Relationships – The types of relationships you have with your customer segments
  • Customer Segments  – The different groups of people you’re trying to reach and serve
  • Channels – How you reach your customer segments
  • Revenue Streams – Where you make cash from your customer segments
  • Value Proposition – The key ideas that create value for your customer segments

Model Analysis

Once you map these elements, you can do an analysis on the strengths, weaknesses, opportunities and threats in the model. What happens if one of your partners disappears? Could a competitor destroy your business by creating better customer relationships than you have?

The outputs of this analysis can allow you question your fundamental assumptions, and to pivot to a stronger model that provides an amazing product or service to your clients. As well as this, the book provides a reference selection of well company and industry models mapped to the template (e.g. Freemium, Google’s model, Traditional Publishing). There’s also a detailed five-stage process on how to run a successful business model design project within your own company. They even include the process they used themselves to produce and market the book! It’s awesome!

Online Resources

Outside of the book itself, they’ve created an entire ecosystem to help guide you:

I’ve shown this book to no less than three people who have immediately gone out and ordered it. This book is a very practical and accessible tool to analyze and improve your business.

You should follow me on twitter here.

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Fundamental or Strategic Value and VC investment

This great article by Sachin Rekhi got me thinking. Sachin broadly divides entrepreneurial tactics between those that are trying to create “Fundamental” value:

An entrepreneur that focuses on building fundamental value is optimizing for creating a standalone business that generates meaningful cash flow and profit as an independent entity.

and those that are going for “Strategic” value:

An entrepreneur optimizing for strategic value is one that is building their organization in such a way to maximize potential value to a larger organization that will ultimately benefit from an acquisition.

The argument is that in order to create Strategic value, you may need to sacrifice profitability for several years while you grow your user base, capture advantage with industry partnerships or create some hard-to-replicate value.  Those companies looking to acquire the business will need some essential market position or value-add that it would be impractical to try to create themselves.

Mint’s Fundamental Value

For a company such as Mint.com we have an example of a business that was creating fundamental value with a product that gave users insights into their finance while earning the company immediate revenue via affiliate sales deals. This was a profitable business that could quite happily have continued under it’s own steam before it was bought by Inuit. It’s quite probable that the founders thought of Inuit as a potential acquirer, but wisely stuck to their original plan to create fundamental value (and revenue along with it).  Despite some industry whinging, it seems to me that it was a good opportunity for the founders to get a return on their hard work.

Why take VC money?

While 37Signals seem to dismiss the entire concept of raising VC money on principle alone, I’m going to play devil’s advocate. The obvious addition of a good chunk of cash to act as a runway can’t hurt.  To build up the basis of a strategic value company may take years to create a platform, collect data, or build up a critical mass of users.  A venture capitalist may carry the sort of clout that legitimizes your company in the marketplace.  A well-chosen VC can also have the sort of contacts that is worth far more than the cash they invest, opening doors in your industry that might be completely inaccessible otherwise. Coincidentally as I finish writing this, Dave McClure announced that he’s part of a panel on this very topic at SxSW.


According to this article from August 2000, Amazon had at least $530 million invested in it. In order to create the strategic value that currently dominates online retailing they burned through huge amounts of capital to build distribution systems, expensive scalable online platforms, huge amounts of content and data entry etc. It seems to be a far riskier play, but if you pick the market, get the formula right, and have a little luck you can fundamentally change how people interact. I can’t envisage a way that Amazon could have done it differently.

Why run away from VC money?

While all clichés may not be true, they surely have some grain of truth in them. The stereotype that a VC will boot out the founders if things don’t go to plan certainly doesn’t happen all the time, but the story doesn’t come from nowhere. The main anti-VC argument that 37signals seem to have is that if you have more money then you’re inclined to spend it less wisely – this is probably valid from simple economics alone. The discipline to ensure the money is used on the important things (or that your VC will be prepared to keep the cash coming) may be the key for companies aiming to create Strategic value.

You should follow me on twitter here.

Book Review: The Art of Strategy

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Avinash Dixit and Barry Nalebuff have written a very engaging and accessible work on Game Theory which they purport is a “Guide to success in business and life“. Game Theory (not to be confused with Game Mechanics) is the mathematics and psychology of social interactions in strategic situations, and while I’m not sure it’s going to make you successful on it’s own it’s a good place to start at least.

Starting off with examples of games that are easily solvable by starting with the desired goal and working backwards, the authors delve deeper into more complicated issues such as how to strategize when both players can move simultaneously, when there are penalties for certain choices, or how to optimize the situation so that both players get the best possible outcome via cooperation.

This book had me gripped. I happily spent time chilling out reading this book instead of trying to catch some decent waves while on vacation in Hawaii. They authors build on simple cases and then dig into a more complex real-world scenarios involving Nash Equillibrium, Minimax, and decisions where the other players can manipulate information or introduce incentives and penalties. The chapter on strategies for participating in auctions is very interesting.

Included throughout the book are questions designed to test your understanding of the material, and good suggestions for further reading. The writing style is light, despite the material getting into some relatively complicated stuff, and the explanations are more than enough to allow you to understand each concept without having to look elsewhere.  A recommended read, there are some really great ideas in there.

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Monthly Posterous Excerpts

I’ve been posting excerpts from any interesting links I’ve come across up at my posterous blog for the last month or so. This is mainly due to the fact that the previous system I was using has decided to no longer work after a wordpress upgrade (Wordpress strips all markup characters) and I’m too busy at the moment to dig through the unholy mess that is wordpress to fix it.

Posterous is a pretty nice system for quickly putting together a simple blog. You can create a post by sending an email, and if you link to a flickr page It’ll automatically pull out the image. Likewise with youtube videos and a dozen other services.

Here’s a rundown of some of the more interesting links from the last month:

A self-help checklist. If you’re making any of these excuses, then you’re at risk of being left behind. Don’t be left making buggy whips when your competitors are out making cars!

This is an interesting perspective. While in college I would have had nothing but contempt for PR and Marketing, which I thought of as just adding noise to a perfect process. Somehow, I reasoned, if the product was good enough people would just start flocking to it. Not so unfortunately. This is a great guide to what value PR and marketing provide to a product.

A great article from Carsonified about using a cleverly designed “Thank you” process to add a more human touch to your business that makes them want to engage more. Carsonified have a very polished design process which stands out as original and eye-catching yet very human.

A few years old, but definitely worth another watch if you’ve already seen it. Andreessen is busy changing the world with his VC fund at the moment, but as one of the few people to have created not one, but two billion-dollar companies from scratch he’s someone who you want to listen to.

Fantastic article by Paul Buchheit on product focus. The message is simple – Pick two or three key things that will create a competitive advantage and do them really really well. Trying to implement every idea under the sun leads to mediocrity initially, and failure in the long run.

Online Video, Streaming, and Apple

Blender.com listed the music industry’s attempts to quash Napster as the greatest blunder in the recording industry’s history. The music industry found itself in a shifting business landscape that it did not understand and felt it couldn’t control. The knee-jerk reaction was to try to do everything in its power to stop online music distribution, including directly suing it’s customers. Freely available online music was a disruptive innovation and the existing model was no longer viable within a few years.

Online Video Following the Music Industry’s Mistakes?

Innovations in streaming technologies and increased consumer bandwidth have made high-definition streaming video freely available in a mainstream capacity. Many of the main television networks stream their most popular shows online, yet there’s still a lot missing. Netflix streams movies and TV shows, but doesn’t have recently-aired shows available. Hulu offers shows within days of their network TV appearance, but doesn’t allow it’s site to be viewed on the Playstation 3 and makes repeated attempts to block streaming on PVR platforms such as Boxee. Will we see the same sort of issues playing out in the online video market?

It is understandable that viewing the latest TV shows will require some sort of fee. I’m happy to watch the advertisements on Hulu or fox.com if I can watch the latest shows – In fact, it’s preferable to watching on the TV as there’s a countdown to tell you how much time is left in the advertisement. The quality is occasionally crappy, but I also don’t want the hassle of dealing with torrents to download shows or movies. So what’s the answer?


Netflix dominates DVD rental, obliterating the bricks-and-mortar rental stores which are increasingly turning into tanning salons. They also make their streaming movies available on XBox, PS3, and Nintendo Wii. One thing they’re missing is the real-time angle. They have streaming trailers for existing movies on the website, but not on the gaming platforms and not for forthcoming movies. They don’t have the latest TV shows as soon as they air, even though they’re available on the TV network’s own site. Why is this? My guess is iTunes. In-show advertising revenue just can’t compete with thousands of users paying directly for the content, so it’s not in the network’s interest to offer it via Netflix. I would also think that profit margins on new TV shows are far healthier than those on music content.

To remedy this, the networks could demand an extra fee from Netflix. I’d pay more for their service if I could get access to certain shows, but I’m certainly not willing to pay a three dollar per-episode price or anything close to it. I’d love to see figures on the overlap of people who regularly buy TV shows from iTunes who also have a monthly Netflix subscription. What percentage of purchasers pay more for individual shows than they do in Netflix subscription fees?

I can’t imagine Apple wanting to change the situation either, in fact judging by their recent behavior I’d be surprised if they didn’t get more aggressive in the video market.  Recently there are allegations that they’re pressuring music labels to ditch Amazon. They’re lawsuit happy this year, also suing HTC for alleged patent infringement on the iPhone.

Further evidence for Social Media ‘Crossing the Chasm’

Following on from my previous post about Salesforce Chatter pushing Social Media across the chasm, here’s a very insightful opinion piece on why ExactTarget’s acquisition of CoTweet will legitimize social media as a mainstream marketing technology. More and more enterprise software companies are accepting social software as a business tool – it’s no longer just an experimental playground for web developers.

Link: Objective Marketer on Integrated Social Media

How to Run a Company Into the Ground

Part One - A recipe for a successful company

  1. Hire really smart people and let them create. Give them some basic guidelines and the time and space to do what they do best. Leverage their creativity and deep understanding and let them surprise you with something amazing. (e.g. Seth Godin’s “Purple Cow“)
  2. Hire mediocre drones and be prepared to tell them how to do every task that needs to be done. Create easy-to-follow processes and training manuals. Track everything they do to make sure it gets done. Plan meticulously for every deviation from the normal. (e.g. Michael Gerber’s “E-Myth revisited“).

You might hire separate groups of A and B people each doing different things, or you might hire a few A people and let them lead a team of B drones to create something awesome.

Part Two – How to run a company into the ground

A recipe on how to frustrate everyone who works with you, burn cash like it’s going out of fashion, and generally run a company into the ground: Treat the A people like B people, and treat the B people like A people. Don’t cross the streams.

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