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The Entrepreneurial Free Agent and Dejobbed Small Business R&D Lab
Rants and Raves #07
Nanocorp predator, industrial megacorp prey?
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Table of Contents

  1. Nanocorp tactics: Raising a chorus of harmonious voices...
  2. The nanocorp at "The Dawn of the E-Lance Economy"
  3. Around the dojo... We're in the Pink!

On this last Labor Day weekend of the 20th century, let's not waste time in historical reflection. Let's dive head-first into our collective future instead.

Nanocorp tactics: Raising a chorus of harmonious voices...

All start-ups struggle to find that elusive investor-pitch 'sweet spot' where what you have done so far plus what you say you will do when funded brand you 'investment-worthy'.

It's even harder to pitch investors if your business is committed to being a nanocorp. The dedication to being 'ruthlessly small' throws them. Our "tiny corporate conglomerate" model flies in the face of the Law of Focus. Our 'nanocorp approach' to free agency simply isn't understood, yet.

Yes, our tightly held business-life beliefs make it tough, but not impossible, for a nanocorp to get funded. Getting the right strategic partner to think so, too, is our next major business life cycle challenge.

[Editorial note: If you are new to the nanocorp approach to free agency, you can get a quick overview here.]

Premature pitching can kill you...

Since nanocorpers use Discretion and Free Will to compete in a marketplace built around Power and Resources, we have to do and think differently.

Had we set out too early to pitch the Really Big Picture of what the 'nanocorp' is about, and how Sohodojo plays reflexively into our broad business vision, we would have raised skeptical eyebrows.

Had we too soon proclaimed our intent to both create and participate profitably in the marketplace we grow based on a network economy of nanocorp-based independent agents, wry glances would have been exchanged, wallet-pockets buttoned.

And had we insisted up front that the only way we could lead this emerging market was by being and remaining a nanocorp! Well, our pitch would have fallen on deaf ears. Opportunity lost to all.

Yes, had we done all these things too early, we would not be here today publishing this issue of Sohodojo's Rants and Raves newsletter. Our energy and resources would have been sapped by doing all the wrong things, for the right reasons, at the wrong time. And we'd be back on the Road Warrior Circuit writing somebody else's code, living someone else's dream.

Sometimes e-business is more like playing horseshoes...
And remember, the tortoise won...

Investors expect entrepreneurs to believe passionately in the business vision they pitch for funding. Consequently, investors have well-developed filters that actively deconstruct entrepreneurs' brazen statements allowing them to see a business for what they think it really is, not what you say it is.

Crafting a pitch that breaches investors' defenses without sounding like The Impossible Dream is a tremendous challenge. We've seen the drain of focus and resources that accompany endless cycles of investor-pitching and pitch tuning.

Being a nanocorp, committed to a different model of growth and expansion, we could not let ourselves get sidetracked into the 'business' of chasing angels. To keep venture funding from draining our time and resources, we have adopted a 'slow burn' strategy.

We cut expenses and we have adjusted our consumer behaviors to maximize how long we can run on our own resources.

We have concentrated on strategic relationship building and guerilla marketing to advance our business development agenda.

And, perhaps most importantly, we both agree that there is nothing we own that is more important than what we are doing. We can be self-funded for the long haul, if that's what we need to do. We joke that we would rather be risking our butts than kissing someone else's as we head into the New Millennium.

We're putting our own money where our mouths are because we know that Sohodojo's success is about 'Internet accuracy', not 'Internet speed'. It's about WHAT we say, HOW we say it and, above all, WHO says it. How SOON is not as important.

But, yes, we know what we'd do with some working capital and the freedom to do things our way... the nanocorp way.

Festinger was right. You can't blow your own horn.

So, we continue to bootstrap Sohodojo. The newsletter is our 'installment-based vision pitch'. We are constantly networking. We continue to do grassroots marketing to build traffic. Bit by bit, we're making Sohodojo into the dynamic place we want it to be.

Bit by bit we are saying: This is what nanocorps are. This is what we need to thrive. This is what our multi-faceted e-Hub addressing the nanocorp marketplace looks like. This is Sohodojo.

And every step along our bootstrapping way, we look for strong, credible voices to help tell our story.

We understand human nature well enough to know that if we tell you nanocorps are important, you may be swayed to that opinion. But if PC Magazine's Bill Machrone, Free Agent Nation's Dan Pink and MIT's Thomas Malone say nanocorps and the free-agent-based network economy are important, well, that's another story.

We want our investor pitch to speak as a harmonious chorus of compelling voices, not as a lone squeak in the wilderness.

And that is what we have in this issue of Rants and Raves, strong voices to add to the telling of the nanocorp story. But these harmonious voices do more than resonate with the nanocorp. Thomas Malone and Robert Laubacher, by way of their landmark 'Harvard Business Review' article, join the chorus helping to make the Sohodojo investors' pitch music to the well-tuned strategic partners' ears.

The nanocorp at The Dawn of the E-Lance Economy

Had we decided on a more traditional road to investor funding, we might have taken a chunk of our bootstrapping capital to commission a market-defining 'white paper' by the most relevant, authoritative voice we could find. We might have solicited MIT's Thomas Malone to envision and describe the nanocorp approach to free agency in a network economy.

Malone is the Patrick J. McGovern Professor of Information Systems at MIT's Sloan School of Management. He directs MIT's Center for Coordination Science and co-directs the institute's initiative on Inventing the Organizations of the 21st Century. His opinions about the network economy and free agency are so hot, he's the "cover-boy" feature interview of the September issue of Contract Professional magazine.

Fortunately, we don't have to commission such a work for hire from Dr. Malone. He has written it already. Malone and co-author Laubacher's The Dawn of the E-Lance Economy has 'nanocorp' written all over it, although they don't use that term... yet.

Laubacher is Malone's associate in charge of the institute's scenarios project which is chartered to envision the range of alternative organizational forms that may emerge over the next twenty years. We could not want better expert witnesses in defense of the position that the 'nanocorp' will be among the most influential 'Star Child' new business forms which emerge from the Big Bang at the Dawn of the E-Lance Economy.

A New Day Dawning where "Small is good"...

Creating Value

First published in the September 1998 issue of the Harvard Business Review, this landmark article already co-anchors a collection of Harvard Business Review articles in book form, Creating Value in the Network Economy. (See for more information and links to both the magazine and book formats of this important article.)

While we appreciate this article for its nanocorp-validating content, it is quite simply the most cogent and lucid description of the revolutionary social and economic changes which will flourish as a consequence of the Internet-based global economy. EVERYONE should read this article. Then, think about what it tells you about your place in the 21st century.

But don't take our word for it. Consider the closing provocative statement which concludes The Dawn of the E-Lance Economy:

"Twenty-four years from now, in the year 2022, the 'Harvard Business Review' will be celebrating its one hundredth year of publication. As part of its centennial celebration, it may well publish a series of articles that look back on recent business history and contemplate the massive changes that have taken place. The authors may write about the industrial organization of the twentieth century as merely a transitional structure that flourished for a relatively brief time. They may comment on the speed with which giant companies fragmented into the myriad microbusinesses that now dominate the economy. And they may wonder why, at the turn of the century, so few saw it coming."

Elastic webs of temporary companies...

Malone and Laubacher clearly make the case -- big companies are in danger of becoming obsolete, prey to an emerging competitive business 'lifeform':

[In an e-lancing network economy...] "Tasks aren't assigned and controlled through a stable chain of management but rather are carried out autonomously by independent contractors. These electronically connected freelancers -- e-lancers -- join together into fluid and temporary networks to produce and sell goods and services. When the job is done -- after a day, a month, a year -- the network dissolves, and its members become independent agents again, circulating through the economy, seeking the next assignment."

The authors further observe, "All these trends point to the devolution of large, permanent corporations into flexible, temporary networks of individuals. No one can yet say exactly how important or widespread this new form of business organization will become, but judging from current signs, it is not inconceivable that it could define work in the twenty-first century as the industrial organization defined it in the twentieth. If it does, business and society will be changed forever."

These are strong words from credible voices. Sohodojo is our place to help make these revolutionary changes happen. Sohodojo is the community where we expect to live our e-lancing lives in the 21st century.

Hollywood's pioneering network economy

Malone points out that elastic webs of freelance specialists coming together to work on a project is not a new idea. Since the 1950s, the Hollywood film industry has been making movies using temporary companies based on a competitive network economy.

Under Hollywood's 'pre-e-lance' network economy, actors, directors, screenwriters, etc., choose for themselves which project to work on. Investors decide which films they want to back. Once funded, the production resources come together for only as long as it takes to complete the film. Then the team breaks up and each goes his or her own way. The 'temporary' company remains as a conduit only as long as revenue and compensation flow.

That's Hollywood, you say? Don't get caught thinking, "That will never happen in my industry." Such fine-grained collaborations of free agents are emerging everywhere that business takes place. Indeed, elastic networks of collaborating partners is at the heart of the nanocorp's organizational model of 'diversified corporate conglomerate writ small'.

Taking a page from the Hollywood script... nanocorp style

Nanocorpers partner in peer-to-peer elastic networks of 'win-win', self-serving collaborations which advance network members' individual agendas and visions. We collaborate with other businesses -- all relations are B2B in a nanocorp -- to create the 'means' to each of our own 'ends'. The players in these elastic networks each maintain their own focus and vision for what rationalizes their participating in such collaborations.

Nanocorp 'subsidiaries' are the shared ownership ventures Malone and Laubacher describe as 'temporary' companies. Your hosts at Sohodojo, Jim and Timlynn, own and operate the JFS Consulting nanocorp. Sohodojo is one of our 'nano-subsidiaries'.

JFS Consulting's current collection of subsidiary businesses is our 'opening hand' as we enter this new e-lancing network economy. Others will take stakes in our subsidiary ventures as strategically necessary for us to meet our business objectives. We'll add to JFS Consulting's 'subsidiary holdings' as others compensate us for our contributions to their elastic webs of collaboration.

Our nanocorp subsidiaries, these 'temporary companies', encapsulate a revenue stream more than represent a long-term asset. Malone's drawing our attention to the 'network-ization' of the Hollywood movie industry is most appropriate in this regard.

The composition of a nanocorp's subsidiary holdings will likely be much more dynamic than those of a conventional industrial era corporate conglomerate. The nanocorp is not only corporate conglomerate writ small, but dynamic as well. Nanocorp subsidiary holdings are cards dealt in hands to nanocorp players in the course of an on-going e-lance economy card game. Nanocorping is a new way to play the Game in Free Agent Nation.

To understand the rules by which we all will be playing in the 21st century, read The Dawn of the E-Lance Economy.

Over the coming weeks, we'll have occasion to refer back to Malone and Laubacher's insights about the e-lance network economy. In particular, we'll 'deconstruct the Dawn' it in terms of venture capital in support of a nanocorping-network model of business.

We'll look at the 'B2B-B2C eHub' business model of Sohodojo as a reflection of the e-lancing network economy. And we'll tell you why our hub's focus on role-based executable business model technologies is all about the software infrastructure on which Malone and Laubacher's E-Lance Economy will be built.

Exciting stuff, this 21st century... where small is good.

Around the dojo... We're in the Pink!

We're in the Pink!... at Free Agent Nation

Dan Pink is arguably the 'Studs Turkel' of the free agent movement. A Contributing Editor at Fast Company magazine, he regularly reports on the emerging ranks of free agents and the network economy.

The once chief speechwriter for Vice President Al Gore turned card-carrying free agent, Dan is currently hard at work on a landmark book about the free-agent economy. This upcoming book was inspired, in part, by Dan's 1998 Fast Company cover story, Free Agent Nation which chronicled the growing ranks of Americans who have abandoned traditional jobs to work on their own.

As a free agent, author, editor, speaker, mover, shaker and webmaster, Dan has his hands full... and he's an active family man to boot! So, you can imagine our surprise when Dan's monthly Free Agent Nation eNewsletter arrived earlier today.

Our surprise turned to delight when we found this Labor Day 1999 issue included a feature article in which Dan names his four favorite free agent zines. There we were, Sohodojo's Rants and Raves, a Pink Pick! Thank you, sir.

You can subscribe to Dan's Free Agent Nation eNewsletter and view past issues by cruising on by Free Agent Nation. Aren't you curious about the other three on Dan's favorite Free Agent zines list?

'Vision Pack' helps nanocorpers live their dream

We saw a network newscast recently which featured a profile of B.Smith, the African-American supermodel turned multi-faceted entrepreneur vying to topple the venerable, but tarnished Martha Stewart, matriarch of the Lifestyle Industry.

While B had many inspiring things to say during her interview, among the most memorable was her summary of what she liked about being a businesswoman. Without hesitation she said, "I like being in business. I like being in charge. I like having a vision."

B popped them off right there, 1, 2, 3. We absolutely agree. The first two aren't worth anything without the third.

And to help you get started envisioning your nanocorp, we've added two titles to the Sohodojo RIBS (Really Important Books and Stuff) store. We call these two titles our 'Nanocorper's Vision Pack' because both books will help you identify and articulate your personal business vision.

 Lemming Conspiracy

The first is McDonald and Hutcheson's The Lemming Conspiracy: How to Redirect Your Life from Stress to Balance. This book is particularly strong in its step-wise method for defining your personal vision. Abundant case study examples illuminate the method.

Making a Living

The second 'vision pack' book is a true classic by a veteran of the solo entrepreneurial movement. Barbara J. Winter's Making a Living Without a Job extols the virtues of being 'joyfully jobless'. Winter's MPC, multiple-profit-center, approach to personal enterprise foreshadows the e-lancing network economy and the rise of the nanocorp.

If you have a burning desire to be an independent free agent but you don't yet know your calling, these books can help. They are not just cheerleading 'rah rah' self-help books. Both these titles provide inspiration as well as practical advice and techniques for developing your personal business vision. Both are highly recommended.

An 'n2B' Outreach Program Report

The next issue of Rant and Raves is going to take a closer look at the Sohodojo 'n2n-n2B-n2C' eHub business model. To date our efforts have concentrated on the n2B side of things.

We've been out rounding up a number of strategic relationships which we believe will have significant value to our nanocorp community. Since nanocorps are among the New Kids on the Block, it is not unexpected that the products and services we need are just not offered. Or they are effectively unavailable due to discrimination built into industry standard pricing practices.

Two of our targeted strategic relationships are maturing nicely. The progress we are making here helps to fulfill our eHub mission of nurturing nanocorp-friendly business product and service offering from commercial vendors.

Over the next few weeks expect to hear some exciting news about our strategic relationships with Netmosphere, creators of ActionPlan and Project Home Page, and Digital Creations, creators of ZOPE.

As always, thanks for reading this issue of Sohodojo's Rants and Raves newsletter,
    --Jim Salmons and Timlynn Babitsky--
    Hosts, Sohodojo

About the Sohodojo Rants and Raves newsletter

We'd like to keep sending you our weekly newsletter. By making it weekly, we guarantee it will be short. Okay, occasionally, when we get on a good rant we might drag on a bit, but we'll try not to do that too often.

We know you have a hectic, busy life. It isn't easy remembering to drop by Sohodojo to see what's brewing. The newsletter addresses this need. You get an easy way to keep abreast of what we're doing and thinking at the dojo. We get a chance to entice you to visit Sohodojo if a newsletter topic sufficiently piques your interest.

Please, feel free to forward this newsletter to others you think may be interested in knowing about Sohodojo, the nanocorp and our approach to the Internet-based small business revolution.

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