Bootstrapped, Profitable, and Proud

Signal vs. Noise has an ongoing series entitled “Bootstrapped, Profitable, and Proud.” Last spring they profiled Braintree and its founder Bryan Johnson. It’s a great story about a guy who, while not particularly interested in payment processing, is interested in setting up and running a good company. Johnson’s particular moment arrived when he realized he was trapped within a bureaucratic, and socio-cultural, web which wasn’t feeding him:

By 2007, Johnson was sick of working for a big corporation. He says, “I concluded that I’d rather live poor and hungry than work in a large, bureaucratic and political environment where I personally couldn’t see how my efforts created value.”

He left the company and eventually started his own company, Braintree, where he attributes some of the joy of working there simply to the people, and they appear to cultivate that environment quite consciously:

Braintree has an eclectic office in Chicago that consists of two large, open rooms, and pixelated old-school Mario decals on the walls. There are no offices, no managers, and no dividers. “It does occasionally get chaotic, but it’s a trade-off we make for collaboration and enjoyment,” says Johnson. “We all make an effort to spend time together outside of work. We eat lunches together, have events at each other’s houses, and organize outings for everything from cooking classes to concerts. We also organize and pay for after-work activities, such as Whirley Ball and Bulls’ games. We try to do one per month.

It’s an enviable, and duplicatable, idea.

M-Edge Accuses Amazon of Bullying

It’s not that I am particularly interested in tracking Amazon’s bad behavior, but as a consumer who has become somewhat invested in their infrastructure, I do like to know all I can about the folks with whom I do business. Ethics matter. In this particular case, according to the lawsuit, Amazon raised its percentage of its take on Kindle accessories, from 8% to 25%, and then tried to bully a supplier, M-Edge, into paying more money for a period of time leading up to the change. When the supplier balked, Amazon threatened to de-list their products.

Amazon is in the news again, and again for all the wrong reasons. Is it really so hard for a corporation to imagine that people will subscribe to your business model if it offers reasonable prices while you engage in reasonable practices? That’s why I shop at Amazon. I don’t need the cheapest prices because the practices behind them are so aggressive as to be “mean.” I guess the important thing here is that is ripe for another enterprise to come into the market place and steal customers like me.

Amazon’s Low Prices Sometimes Come with a High Cost

Regular readers know that I am not only a fan of, but also a subscriber to its Prime feature. I think the company has made most of the right moves, except its digital content offerings, especially video, seem stuck in some older, uglier version of the web where a lot of the functionality you expect isn’t there and what functionality you expect requires a click that takes you to yet another page. Worse, those pages often don’t know from whence you came.

All that noted, there is always a potential dark side to human endeavors, especially in the business world where costs, by and large, don’t magically disappear, but instead get shifted somewhere. The question is always there. Americans have largely had our stagnant wages propped up through the low cost of items manufactured in other countries where wages are low and the cost of regulation, such as environmental protections, are far less.

If you are in the distribution business like Amazon, however, you have little choice but to have facilities throughout the U.S. But there is always a way to squeeze out costs. The way Amazon does it, in at least one location in Pennsylvania but one has to assume the others operate similarly, is to operate a warehouse that is not air conditioned, use temporary workers, and design a system that literally uses people up, guaranteeing they won’t stick around for a permanent position.

A local Pennsylvania paper has the complete story.

Build Your Own Platform (Really “brand” describes what Hyatt is after perhaps better than platform, but his article is focused on the IT infrastructure that one uses to build a “brand” — or franchise or whatever.)