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Boss Life: Surviving My Own Small Business (Book Review)

Paul Downs, author of Boss Life and owner of Paul Downs Cabinetmakers
Paul Downs, author of Boss Life and owner of Paul Downs Cabinetmakers.

Running a small business can be brutal. With the publication of a new book, Boss Life, you don’t have to learn all the hard lessons on your own. Instead, read about the mistakes and occasional hard-won triumphs of Paul Downs, an old-school entrepreneur who describes himself thus: “I am a survivor, but not a financial success.”

This first-time author founded and manages the furniture company Paul Downs Cabinetmakers, which has been in business for twenty-nine years, since 1986. He also formerly wrote for The New York Times and happens to be my uncle.

Yes, I’m related to Paul Downs, but allow me to insist that I won’t be the only one who thinks Boss Life is great. Downs uses real numbers and anecdotes, some of which do not flatter his personal judgment, to illustrate the larger principles. His candor makes the book fascinating.

Boss Life: Surviving My Own Small Business
Boss Life: Surviving My Own Small Business by Paul Downs, published by Penguin’s Blue Rider Press.

Luckily Boss Life has almost nothing to do with woodworking, though that is nominally the content of Downs’ company. The book is really about sales. It’s about marketing and customer acquisition. It’s about cash flow, accounting, and management — basically, Boss Life is about economics and human nature.

Downs brings the reader through a year in the life of his company (specifically 2012), beginning each chapter by stating his bank account balance, the value of sales to date, and whether he’s lost money overall. Then he explains the month’s events and why they had the financial repercussions they did.

Part case study and part memoir, Downs’ book is worth reading if you employ people, are employed, or work in any capacity, no matter the size of your operation. That’s my review as a reader, not a niece.

A rosewood-and-ebony conference table designed and built by Paul Downs Cabinetmakers.
A rosewood-and-ebony conference table designed and built by Paul Downs Cabinetmakers.

Basic Economics = Wondrous

“Revenue follows user attention, not the other way around; unlike money, there is a finite amount of minutes in the day, and a finite amount of users. To put it another way, attention is a zero sum game; every minute spent in Snapchat or LINE or WhatsApp is a minute not spent in Twitter or Facebook or Instagram.” — Ben Thompson on Stratechery

money whirlpool
Money vortex by Patrick Hoesly; tinted by me.

Scarcity is the key to economic value. If something is abundant and easily accessible, it’s not valuable. If something is limited and hard-to-get, it is valuable.

The concept of supply and demand — the relationship between the two forces — is so fascinating to me. Simple principle, but I keep turning it over in my head.

Supply and demand pressures come from asymmetry. From lack of balance. If Billy has more oranges than Sue, he has leverage, assuming Sue wants oranges. If Erica has more information than Rohan, she has a different kind of leverage, as long as Rohan is interested in her information.

Essentially, the key to business success is persuading someone to give you money for an object or a service. You have the thing or the skills. They have the money and desire.

Again, I know this is all very basic, but thinking it through makes my brain happy.

old-fashioned typewriter
Photo by Martina TR.
The Greek Tragedy: A Labyrinth of Debt
Abstract art based on the Greek debt crisis, by Carlos ZGZ.

Tech Is Only Awful Like People Are Awful

News-media analyst Ken Doctor wrote, “The web may have opened unbelievable frontiers of human thought and interaction, but it’s driven by the same business principles as all other enterprise.” Basically, the market is always the market. Self-interest is a perpetual motivator and supply-demand dynamics continue to exist.

The internet changes a lot, but it doesn’t change the fundamentals of economics. It changes the cost (or lack thereof) of some specific things, like distributing information, but it doesn’t change basic human behavior. It’s kind of ludicrous that anyone might expect it to.

DARPA's Warrior Web project may provide super-human enhancements
Photo via US Army RDECOM.

So here’s the point, which has been made before: Everything we don’t like about the implications of technology boils down to something we don’t like about the way humans organize ourselves. Because — to risk repetition — technology doesn’t change humanity; it simply enables us to express our persistent nature in new/different/tweaked ways.

For example, as Adam Elkus wrote on Slate, “Algorithms are impersonal, biased, emotionless, and opaque because bureaucracy and power are impersonal, emotionless, and opaque and often characterized by bias, groupthink, and automatic obedience to procedure.” An algorithm like the one that defines Facebook’s Newsfeed didn’t spring into being independent of people’s choices; it was constructed and enacted based on such choices.

DARPA's Warrior Web project may provide super-human enhancements
Photo via US Army RDECOM.

Most consumers don’t know, think, or care about the value judgments being made by the engineers and programmers who design the functionality of apps, phones, thermostats, cars, etc. As long as a product gives us something pleasurable or useful, we brush aside collateral concerns. (Apathy toward data collection is a great example of this.)

Industries respond to what people — and aggregates of people — actually care about, which is expressed via money. As Adam Gopnik wrote in The New Yorker, “Markets are designed to make their own rationality. Where people put their cash reflects what they think and desire.”

Society is unjust because people are unjust, individually and collectively. We often don’t truly care about the things we claim are crucial, or the principles we tout as cherished values. (God save reporters’ salaries.) This is reflected in how humans make and use technology, just as it’s reflected in every other human endeavour. Susie Cagle’s series “The Crooked Valley” illustrates this (literally) very well.

The Power of the Follow-Up Email

email icon
Via Joe The Goat Farmer.

A big part of my new job is emailing people. Not just emailing them once, but sending an initial message, waiting a couple of days, then following up over and over again until they address my questions. Some people respond to the first email, which is great. Some people respond to the second, which is also great. A few people don’t respond until the sixth or eighteenth email. (At least theoretically — I haven’t gotten to that point yet. It’s only been two weeks.)

Vous avez dit email?
Image via g4ll4is.

Maybe the follow-up email is an obvious technique, but it never occurred to me until I started work at ORO. I felt like I could send an email once and leave it at that. If the recipient wanted to respond, they would respond. If they didn’t — well, so much for that! However, when you’re talking to clients and vendors on behalf of a business, you can’t be so laissez-faire.

What’s really great is that the follow-up email works, probably through the power of sheer annoyance. By popping up in someone’s inbox repeatedly, I make them think, “Ugh, this Sonya chick won’t shut up until I respond. FINE.” Basically, I push myself to the top of their to-do list.

I fully intend to use this realization to further my personal interests as well as ORO’s. Expect more irritating emails from me! Sorry in advance.

Pacman eating emails
Illustration by Jonathan Lister.

Niche Websites Aren’t Trying Hard Enough To Make Money

Blinded by Journalism
Photo by Ahmad Hammoud.

How to fund online journalism? For the most part, the conversation has focused on advertising. Hampton Stephens, founder of the self-sustaining World Politics Review, finds this puzzling. He cautions websites backed by venture capital, like BuzzFeed and Vox:

“The lesson that most media startups seem to have taken from the evisceration of advertising-supported journalism over the past two decades is that more innovation is needed… in advertising. […] To ensure the kind of ‘accountability journalism’ that is critical for any democracy to flourish, well-funded new media players must experiment with models other than advertising.”

Apparently everyone wants to copy the free metropolitan weeklies stuffed with “medical” marijuana enthusiasts. (No offense meant, East Bay Express.) A few high-end legacy newspapers—and premium newcomers like Stephens’ World Politics Review—have made subscription systems work, but only up to a point. The signups are slowing down. So… that’s it. Alternatives are strangely infrequently discussed, despite the occasional hat tip to research divisions.

Here’s the problem: Advertising works reasonably well when a website is deluged by traffic, but what about smaller operations? Are niche editorial websites doomed, or are they thriving? The general trend can be difficult to track, but journalistic endeavors of all sizes are trying to guess how they will be funded in a mobile-first world populated by Millennials who balk at paying for information.

Continue reading “Niche Websites Aren’t Trying Hard Enough To Make Money”

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