Shoes and Ships

December 1, 2011 § Leave a comment

‘The time has come,’ the walrus said, ‘to talk of many things: of shoes and ships – and sealing wax – of cabbages and kings.’
- Lewis Carroll, Through the Looking Glass

The biggest factor to success in business is spotting an opportunity. This is what people call after-the-fact as being lucky or being “in the right place at the right time.” Opportunity arises periodically everywhere. So timing does matter, in the form of patience. But being in the right place is irrelevant. The key is to be somewhere. That is, having domain-specific knowledge is key to spotting an opportunity. It is not just technical acumen, access to capital, and connections that matter, it is having the knowledge, interest, and experience with a given industry to bet big when the time comes.

Bill Gates was a great programmer at the time and plenty smart. But he also had a desire to turn his interest in computers into a business and a deep understanding of the computer and electronics industry at the time.

Similarly, Michael Bloomberg was smart and had enough money to bootstrap his own software and data company, but the fact that he was deep into the financial data world around was crucial. Bloomberg pissed off a senior guy at Salomon and got shifted to Siberia: the back-office IT department. If you can even call it IT—think punch-cards and ticker-tape back then.

Despite what Harvard Business School would have you think, management is not a general trait that can yield success in any industry if properly developed. The reason most CEOs fail is that they lack deep knowledge of their industries. It does not take an entire life of study to become knowledgeable about an industry. Jeff Bezos learned all he could about selling books as he was starting Amazon. Bezos even turned up at local workshops for community booksellers to gain a deeper understanding of the industry he was preparing to destroy. It is called doing your homework. And, as with schoolwork, if you’re actually interested in what you’re learning about it’s actually a lot of fun.

It is not controversial to say that the greatest athletes, movie stars, directors, writers and musicians were not only students of their crafts, but also students of the history of their fields. If you have ever heard Martin Scorcese talk at length about the Golden Age of Cinema, or even Jay-Z trace the entire history of hip-hop via a single rhyme, you know what I mean.

Practice your craft. If you’re a programmer, get damn good at it. If you’re a marketing or business development specialist, do whatever it is that marketing or biz-dev people do. But immerse yourself deep within an industry (anything: cars, waste-water treatment, cosmetics) and you will be able to take advantage of opportunities that those that lack either subject-matter expertise or technical ability (broadly-defined) cannot.

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