I’m a very passionate speaker. Whether on radio or at business retreats, I always used to start my speeches for top management executives with examples of enduring organisations but these days, I cut myself some slack. Enough of these talks of companies that have lasted 250 years. Maybe we should move from Built to Last, to Built to Flip. It is a pretty new paradigm shift that births for me a series of intriguing ideas: No need to build a company, much less one with enduring value.
We live in an era of angel investors, VCs and business trading. See what’s going on, Linkedin has been acquired by Microsoft, Mobil was acquired by Exxon, Time warner by AOL, Smithkline by Glaxo, Heinz by Berkshire Hathaway. Instagram was acquired by Facebook, Yahoo by Verizon, Altera by Intel, Whatsapp was acquired by Facebook, Youtube was acquired by Google, Android was acquired by Google (for a mere 50 million dollars). So we are in that era.
Bringing this trend back home, as the CEO of Hexavia, one of Nigeria’s top management consulting firms, I’ve sat in boardrooms and start up strategy sessions with people who just want start, build and transfer, and at the other end, people who just want to buy and sell and not own what they are building. I’ve been shut off by rich guys who tell my start up mentees that “We’re not interested in enduring, great companies. Come back with an idea that you can do quickly and that you can take public or get acquired within 12 to 18 months”. First I had a mental culture shock and then the reality hit me.
The 21st century is designed and will actually have less Built to Last and more Built to Flip companies!!!
This is because, the 20th century saw a lot of inventions, 21st century won’t come with a lot of inventions (almost everything already have) hence, we will have the modified and better application of those inventions. So the 21st century will be based on innovation and innovative companies. This is invention in transition. So institutions will be more fluid, even with their brand, which was a major attribute of Built to Last. Who has noticed that this century is starting off with loads of VC companies (Venture Capitalists, so it will be Built to Sell, Built to Flip).
Built to flip is a powerful business model. It may even become an industry like banking and insurance. But there is a sad part of Built To Flip, which has been powered by youngsters selling potentially greater or at times even half baked solutions for a fortune and becoming filthy rich and wealthy and now everyone wants to follow suit. It will get worse, especially with tech companies and retail stores. It started off in Wall Street, fired up to Silicon Valley and now even in a country like Nigeria, we are seeing the likes of Mark Zuckerberg coming to scout for companies to buy (we all know the Andela story). This is the sad reality of the new economy; it seems to have no soul. The hard truth of this, is that we’re dangerously close to killing the soul of entrepreneurship with the new economy. Even worse, we’re in danger of becoming the very thing that we defined ourselves in opposition to. Those who kindled the spirit of the new economy rejected the notion of working just for money; today, we seem to think that it’s fine to work just for money—as long as it’s a lot of money. Build to Flip is powered by hunger for success, but Built To Great is Powered by Greatness.
For a few years now, I’ve been building a community of the most powerful minds and enterprise oriented people. It’s a cerebral based business club where people cross sell to sell till we create our own economy and ecosystem. Sometimes it is uneasy. I remember the amount of people who have said to me, you know you can make a fortune if you commercialize the concept of HBC.
It may make sense when it feels like you can’t even get enough commitment to run Decoded by the same people it is being built for, so maybe we should charge a fee as a way to separate the numbers from the actual committed. Just sell off the idea we’ve been told. I usually say, yes, I’ll become more successful but less of greatness. So we are talking trade offs. That’s not how I think I am built to roll. But Built to Last Versus Built to Flip trade off is a real issue in today’s world.
The truth is, capitalism feeds off itself, almost by definition. The profit-seeking seeks the profit-seeking. As long as money is a factor and a trigger, economies of scale exist, and as long as acquisition represents a quick path to growth, multi-billion-dollar buyouts will continue to be a part of a business landscape that’s perpetually under construction.
One of my best read of all time is actually Built To Last. I love this book as my top 10 read of all times because it made me realise the power of core values and ideology, it made me think “Yes, there are some timeless fundamentals. They apply today, and we need them now more than ever.” Second, the book affirmed that the essence of greatness does not lie in cost cutting, restructuring, or the pure profit motive. It lies in people’s dedication to building companies around a sense of purpose—around core values that infuse work with the kind of meaning that goes beyond just making money.
Third, the book tapped into powerful, albeit latent, human emotions: Readers were inspired by the notion of building something bigger and more lasting than themselves. In quiet moments, we all wonder what our lives will amount to, what we’re going to leave behind when we die. Built to Last pointed people toward a path that they could follow if they wanted to leave behind a legacy. But these three things is usually lost in Built to Flip