Small is the new big

Small is the new big.

Big used to matter. Big meant economies of scale. (You never hear
about “economies of tiny” do you?) People, usually guys, often
ex-Marines, wanted to be CEO of a big company. The Fortune 500 is where
people went to make… a fortune.

There was a good reason for this. Value was added in ways that big
organizations were good at. Value was added with efficient
manufacturing, widespread distribution and very large R&D staffs.
Value came from hundreds of operators standing by and from nine-figure
TV ad budgets. Value came from a huge sales force.

Of course, it’s not just big organizations that added value. Big
planes were better than small ones, because they were faster and more
efficient. Big buildings were better than small ones because they
facilitated communications and used downtown land quite efficiently.
Bigger computers could handle more simultaneous users, as well.

Get Big Fast was the motto for startups, because big companies can
go public and get more access to capital and use that capital to get
even bigger. Big accounting firms were the place to go to get audited
if you were a big company, because a big accounting firm could be
trusted. Big law firms were the place to find the right lawyer, because
big law firms were a one-stop shop.

And then small happened.

Enron (big) got audited by Andersen (big) and failed (big.) The
World Trade Center was a target. TV advertising is collapsing so fast
you can hear it. American Airlines (big) is getting creamed by Jet Blue
(think small). BoingBoing (four people) has a readership growing a
hundred times faster than the New Yorker (hundreds of people).

Big computers are silly. They use lots of power and are not nearly
as efficient as properly networked Dell boxes (at least that’s the way
it works at Yahoo and Google). Big boom boxes are replaced by tiny ipod
shuffles. (Yeah, I know big-screen tvs are the big thing. Can’t be
right all the time).

I’m writing this on a laptop at a skateboard park… that added wifi
for parents. Because they wanted to. It took them a few minutes and
$50. No big meetings, corporate policies or feasibility studies. They
just did it.

Today, little companies often make more money than big companies.
Little churches grow faster than worldwide ones. Little jets are way
faster (door to door) than big ones.

Today, Craigslist (18 employees) is the fourth most visited site
according to some measures. They are partly owned by eBay (more than
4,000 employees) which hopes to stay in the same league, traffic-wise.
They’re certainly not growing nearly as fast.

Small means the founder makes a far greater percentage of the
customer interactions. Small means the founder is close to the
decisions that matter and can make them, quickly.

Small is the new big because small gives you the flexibility to change the business model when your competition changes theirs.

Small means you can tell the truth on your blog.

Small means that you can answer email from your customers.

Small means that you will outsource the boring, low-impact stuff
like manufacturing and shipping and billing and packing to others,
while you keep the power because you invent the remarkable and tell
stories to people who want to hear them.

A small law firm or accounting firm or ad agency is succeeding
because they’re good, not because they’re big. So smart small companies
are happy to hire them.

A small restaurant has an owner who greets you by name.

A small venture fund doesn’t have to fund big bad ideas in order to
get capital doing work. They can make small investments in tiny
companies with good (big) ideas.

A small church has a minister with the time to visit you in the hospital when you’re sick.

Is it better to be the head of Craigslist or the head of UPS?

Small is the new big only when the person running the small thinks big.

Don’t wait. Get small. Think big. 
  … [Seth's Blog]

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