Pajamas Media

A few people have asked me about my opinion on what I think is now called Open Source Media, and wondered why I’m not involved or if I’m bitter about not being involved. My position can be summed up thusly:

1. Heard about it.
2. Didn’t sign up for it.
3. Don’t care about it.
4. Expect it to crash and burn.

I don’t even bother to click on Blogger’s AdSense and you think I’m going to get worked up about maybe, possibly, turning yet another hobby into a job? I don’t think so. I will admit that my ears did perk up for a moment when I first heard about Open Source Media, but only because I thought it might have something to do with a new Linux distro that runs Xine better than my FC3 does right now.

Why the #4, especially in light of the fact that I’ve paid virtually no attention to this experiment in new media? It’s pretty simple. I’ve successfully started one technology company, am in the process of successfully starting another one, and I do not believe that the VC model of financing is an effective one. If your business model does not permit you to begin making money from the start, your existence will largely consist of racing from one round of financing to the next.

Sure, you can draw a fat salary for a few years this way, but you can do that from producing pornography too. Personally, I’d rather produce porn; it’s more honest and the women are nicer.

The fact that VCs are willing to invest money says literally nothing about the fundamental strength of any business venture, in fact, one reason I’ve repeatedly turned down requests to invest in my new business is that these are the same people who sunk millions of dollars into remarkably stupid dot com ventures. I’ve also seen them turn down business that do nothing exciting except produce hundreds of thousands of dollars worth of profit every year for two decades. I’m not absolutely against every working with a VC, but as I told my good friend who works in that industry, they’d need to present me with one Hades of a case.

Another problem is that the typical VC exit strategy is built around taking the business public at the very first opportunity, which is nice if you just want to cash out for a few million, not so great if you actually want to build a viable business that will produce profits for many years to come without answering to the government and 500 other people.

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