Technology companies usually go through a couple distinct phases. There’s the one that gets all the fun legends. That’s the step where a small team of like-minded idealists realize they’ve been gathering in a garage workshop for like four years now and finally have a salable product. This is a thrilling moment. It comes none too soon, since the garage’s owner nearly caught them last time. It’s all fun adventures. First there’s the challenge of getting something to work. Then there’s the challenge of getting it to work when they just moved it to the other table. It’s not even four feet away from where it was. It’s a computer program. What is there even to break? But that’s solved. Then there’s the challenge of getting it to work for anybody else. Everyone agrees this is the good part of any technology company.
Much later comes the phase where the company has lots of employees. This means that they can worry about different issues. Like, there’s worrying about how to get the right ice cream cake for the birthday party for the person who’s out sick today anyway. There is no right answer, which is all right. This phase usually comes after the one where the staff realizes they’ve got something with a name like “zMyRiLX System Service Provider” on the servers. It’s critically important. They’ve upgraded that to a version nobody knows how to set up anymore. It isn’t even the current version. The old version, someone had poked with sticks enough that it didn’t break anything too important. This new version has taken away the sticks. It all seems hopeless. This is when we move on to the birthday ice cream cake phase.
There are intermediate stages too. For example, after creating the first product, there’s the question of what to make as the fifteenth product. This will be the thing you had wanted to be the third product and that never really came together. It will flop. No technology company has ever had its fifteenth product succeed. The best they can hope is that it’s seen as ahead of its time, and a noble failure. The most innovative technology companies fail in ways that other companies hope will fail for them in ten years.
Technology companies have issues that are unique to the industry. Like, a company that rakes leaves doesn’t have to worry about digital rights management. They just have to worry that employees aren’t spending all their time having light saber fights with the rakes. At least until a technology company comes in and screws things up. At that point, though, it doesn’t rake leaves anymore. The name will change from, say, Pine River Lawn Care to something that sounds like a medication or an 80s boys’ cartoon villain. Chloronax, say, or Verderant. At that point it doesn’t do anything. It just updates databases. Those databases contain mean stuff said about you.
Some technology company problems are common to every company. Like, when should they mistakenly not diversify? Eventually people forget why they needed whatever the company’s old products were. But the other choice a company has is to mistakenly diversify. This is a fun one because whatever it is you’re doing, it seems more fun to do something else. So going from one business into another always seems like a great idea. Eventually your company can be so diverse that it doesn’t do anything, but does it in a lot of fields. Then you should be ready to suddenly collapse in one of those fascinating yet boring business implosions, and re-emerge years later as a snarky Twitter account.
So what’s the right course? Hard to say. You can read histories of companies in similar circumstances. This will show how for every course of action there’s at least four other companies that did that and were so very wrong. The conclusion is to just not do anything, really. This explains that time in 1968 when, facing the rise of Electronic Data Systems, Remington-Rand just spent August rolling down a hill.
The best guidance is to look up the history written several decades after the company goes out of business and sent back in time to you. When you come across a chapter with an ominous title like “The Fateful Choice” read very carefully and try not making that choice. This might create a logical paradox destroying time and space, but perhaps the book was wrong anyway.