Trying to make some sense of it all

I’m still trying to get to grips with the course of events in the UK recently. Since the Brexit referendum, of course, but increasingly over the past few days. I’m getting a bit tired of the Facebook echo-chamber and so given that I have a blog I figured I’d take a momentary break from talking about tech to think through these issues. But here’s a tweet to give some Tech Business angle to this post.

OK with that out of the way let’s get on with things.

The Conservatives apparently want to shame British firms into hiring more British workers by making them publish how many non-British workers they employ. And most Brits apparently support that position.

Similarly, they, apparently all of a sudden, want schools to list how many foreign-born students they each have. And there are also the reports about the Foreign Office not wanting to use foreigners in some advisory work to do with leaving the EU.

Meanwhile, the de facto opposition party (UKIP) has experienced thuggish behaviour and somehow this is considered acceptable by the UK electorate. And in a surprising twist, a UKIP representative has spoken out against these Conservative ideas.

I’m a member of the liberal, cosmopolitan elite. In the referendum I supported Remain. My sympathies were to Leave based on the mess that the EU has made of Greece. But the absence of any realistic vision for how Leave could work meant that, for me, the whole thing was flawed. I suspect that most (all?) other voters also have their own reasons that defy stereotyping. I certainly didn’t enjoy the Remain scare-mongering. For what it’s worth I also have a healthy scepticism of experts – they crop up all over the place and I’m not always convinced of their insight. However I do have to admit that some of the worst scare-mongering (I seem to remember £1 being predicted to fall as far as $1.28) has now come true so I do wonder what else will be coming over the horizon.

Anyway, back to the plot. The public was asked a question and in a close result the public answered it. Brexit was about leaving the EU. I hope that however Brexit gets implemented it is not a simple Tyranny of the 51%. But that’s not what worries me most. What worries me most is that, based on the noises that we are hearing, Brexit is increasingly becoming about xenophobia, not about the EU.

Since the referendum result racist incidents have increased. Over the past week we’ve seen these latest nationality-related proposals. Obviously I’ve never met any of these people and don’t know what their motives are, to what degree they believe what they are reported as saying, to what degree they are grandstanding or just doing their job or whatever. But something is very concerning indeed about the content of this debate.

Let’s come back to the Name And Shame Businesses Who Employ Foreigners idea. The Party may now be back-pedalling on it but remember that, firstly, it was seriously considered, and secondly, the reality is that apparently most UK people support it. I do expect it to come back in another guise sooner or later (consider the example about profiling non-Brits in British schools). So let’s imagine that, in order to try to improve standards of living, British companies are somehow encouraged to hire native Brits rather than foreigners. It’s easy to see where this will end: They will hire based on nationality rather than ability; so they will perform less well; standards of living won’t increase as expected; immigrants will get scapegoated even more; and the cycle will repeat itself.

Whether in our out of the EU, this country depends on immigrants and will always depend on immigrants. Immigrants disproportionately contribute to the UK, despite the views evident in the YouGov poll. How to reconcile these contradictory facts is something I would hope our leadership manages to lead on, rather than just scapegoating immigration as they seem to be doing. I do have a general faith in common sense, decency and democracy so I remain optimistic, but it ain’t easy. Maybe I’ll have to stay up to watch the US Presidential Debate tonight to remind myself that it could always be worse.

Update 31st December 2016:

One thing that has been playing on my mind is the clear strength of feeling on the subject. There was a James O’Brien LBC clip doing the rounds a while back in which a Leave voter was finding it hard to articulate why he wanted to Leave (probably something to do with immigration). Getting out-talked by a talk show host isn’t the interesting thing here. The interesting thing here is that towards the end of the call the caller says he is willing to suffer 5 years of financial/economic hardship in order to get to a better future. That level of self-sacrifice is pretty incredible.

That’s not a business, it’s a hustle

“That’s not a business, it’s a hustle.”

I’m paraphrasing Dan Lyons speaking at a recent Chew The Fat event. He was talking about his time at HubSpot and wondering how a loss-making company could grow so fast, list, and make a lot of investors a lot of money. In his view its business model is fundamentally flawed: he describes it as buying dollar bills at face value and selling them at 75 cents each. That sort of model may well get you hyper-growth but it’s a hustle, not a business.

The image of the hustling, zillionaire tech entrepreneur who has never made worried about profits has become dangerously deeply ingrained. I recently got talking to a graduate – evidently a bright individual – who ran a business idea past me. It was to do with optimising a retail shopping experience. Quite a neat idea so I asked the obvious question: where would the revenue come from? The consumers or the retailers?

He didn’t have an answer.

He assumed that all he’d have to do is somehow get some VC money, spend it on scaling a platform with loads of users, then sell out and walk off into the distance with $50 million in his pocket. Now that’s a hustle, not a business. There are cases where this has happened. But there are also plenty of cases of people winning the lottery and I suspect that on a risk-weighted basis, winning the lottery is more likely than being a part of the next Whatsapp.

Please, if you want to become an entrepreneur, bear these two things in mind:

  1. You stand a better chance of making a successful business if you have intimate knowledge of the problem you are trying to solve. If you’re targeting students then, fine, as a recent student you might have more than enough knowledge to build a viable business. But if you’re not then probably you would need to work somewhere for a few years to get that deep understanding first (“domain knowledge”, in the jargon)
  2. You will stand a better chance of success if you can create something that makes revenue, profit and cash. All those things are different so make sure you have a clear idea of how they will interplay in your business. In fact, you might even end up with more money in your pocket if you build a niche, profitable, growing business than if you go chasing unicorns.

This doesn’t mean you need a detailed business plan. You just need to be articulate those two points in as straightforward a fashion as possible. Here’s a classic DHH talk to hopefully get you thinking along the right lines . Incredibly it is still as valid today as it was in 2008.