A technology based business requires a techie

I met with Phil Windley today about my blogging business, writingup.com.

That guy knows his stuff.

He talked with me about slashdot business models, human edited business models, and wikipedia business models.

We talked about the advantages/disadvantages of starting a long term business vs just creating stuff that generates cash (which is what I currently do).

However, the most brilliant piece of advice (IMHO) he said today was that a technology based business requires a techie to be successful.

I mean, it makes total sense, but it had never occured to me before.

In a technology based business, the tecnology drives the business. If it’s good, the business goes. If not, it doesn’t. Now, this isn’t always true, but it’s pretty difficult to market a product that stinks. However, if you have a techie who is deeply involved, or who is passionate about it as Phil said, the business will work a lot easier than if it lacks that person. If you just have a programmer who doesn’t really care about it, it’s a lot more difficult to make the business go.

Also, when you couple that with what Paul Allen has told me about how you valuate companies, it makes total sense. Paul says that when you valuate a company, you add $500,000 for each engineer the company has, and you subtract $250,000 for each MBA the company has.

Engineers create value. They create products.

MBA’s talk.

Maybe that’s why it’s soooo difficult right now to find good tech help here in Utah County.