The billion-dollar micro business?

(Also, it's been a while)

It’s been quite the while since I last shared anything here. So — I’m half styling it out and half writing something here. No promises it won’t be another nine months before the next one.

“What’s measured gets managed.” — Peter Drucker

Sometimes referred to as the Hawthorne Effect, is the idea that people pay more attention to working on stuff that’s being measured. If you want some aspect of your operations to improve, grow, or decline, tell your team it’s being measured.

It’s admittedly somewhat trickier to ensure you’re measuring the right things. These two new videos by Tom Blomfield (co-founder of GoCardless & Monzo, now a team member at the legendary Y Combinator) are essential viewing for B2B or B2C growth businesses.

If this isn’t enough Tom Blomfield for you, then this third video, where he tells the story of how he built Monzo, is also excellent.

The billion-dollar micro business?

Sam Altman, CEO of OpenAI (at least at the time of writing), gave an interview the other day where he revealed that he and a bunch of his tech CEO mates have a group chat where:

“…there’s this betting pool for the first year that there is a one person billion-dollar company. Which would have been, like, unimaginable without AI. And now it will happen.”

Hyperbole aside, I tend to agree with this. While recent history strongly suggests that the first self-employed business owner to reach a billion dollars of revenue (valuation would be easier, but still ground-breaking) will most likely be a tech company (and probably the second, third, fourth...), it’s a provocative question to ask of any industry category.

It reminded me of the keynote I did at Xerocon London 2018, where I hypothesised about the inexorable path that tech usually follows and how it typically involves progressively improving an industry quite a bit, then one day - BANG! - it completely flips and transforms it beyond all recognition. I cited some examples with the computerisation of stock markets in the 1980s, leading up to today’s HFT (High-Frequency Trading), and how purchasing music on iTunes 20 years ago seems quaint when set beside streaming music platforms like Spotify today.

In my talk, I proposed that the continued fracking of tech into the worlds of business management and compliance could mean that we’ll one day see an organisation that’s composed of several hundreds or even thousands of entities - with most of the constraints of our limited human capacity to manage such scale eliminated by tech and AI.

The thousand-entity business is a pivot on the billion-dollar micro business notion, but I’m sure both could well happen, and I reckon within ten years.

Where is Europe in all this?

The second in the series of anxiety-inducing, punchy one-liners from CEOs of US-based tech behemoths in the last few days comes from Alex Karp, CEO of a data analytics company, Palantir.

“Within 10 years, around 95% of the world's top tech companies will be American thanks to the U.S. lead in AI.”

It ought to be pretty clear to anyone now that the engine is running, and the propeller is propelling us forward into what increasingly feels like the early reaches of the AI era. This raises profound questions about what our future might look like if much of it is monopolised (and then some) by US tech giants.

So, it was timely this week that an excellent paper was published by Boardwave, a not-for-profit organisation set up in 2022 by Phill Robinson. Phill’s paper diagnoses European tech companies' numerous challenges and proposes several initiatives to tackle them.

“The UK and Europe needs to support its local and regional software champions, whilst at the same time rapidly changing gears, leveraging new transformational technologies to achieve more dynamic economic growth across multiple sectors. We must do this by empowering our next generation of software founders to scale-up at pace, to create a new category of leading global software businesses built in the UK and Europe. This is important not only for growth in a digital-first economy, but also for our strategic autonomy and security.”

Europe is a funny place for tech, particularly SMB tech, and it remains spectacularly fragmented and siloed across the continent, having repelled countless invasion attempts over the last forty-odd years.

Global enterprise tech has prevailed somewhat across Europe — multi-national businesses collectively share similar sets of problems that are more easily solved by enterprise products from Salesforce, Oracle, SAP, Workday, etc. — and Europe can also point to a number of successful B2C breakout stars, like Skype, Spotify, Klarna and others.

But the world of SMB tech remains staggeringly parochial. I’m frankly not smart enough to know whether such inherent defensibility is a good thing in the face of the coming AI tidal wave. But someone ought to work it out.