Purpose, Playbook,
Patient Capital
The same venture gets asked, at the same time: should it exist? Can it be built? On what clock?
A venture strong everywhere but one place does not come out average. It fails in the particular way the missing piece predicts, and you can usually see it coming.
Purpose
Purpose is a written answer: who is better off, by how much, and how we will know.
And a list of what we will not do to get there. Write both before the opportunity turns up. Written afterwards, the list is just an excuse.
Then put it where decisions are made. The ethical boundary belongs in the business model canvas, next to revenue, cost and channels, and it carries the same weight as any other box on it. A values page is what a company shows a candidate. A canvas is what a team looks at on a Tuesday.
Mondragón
Founded in the Basque town of Mondragón by Father José María Arizmendiarrieta and a group of his students, as Talleres Ulgor. The federation now employs tens of thousands of people, and pay ratios stay tight from the top down by policy, not by sentiment.
Both the worker ownership and the ratio sit in the governing documents. That is why they have survived decades of commercial pressure.
The opioid record
OxyContin's marketing contributed to an epidemic linked to more than 500,000 U.S. deaths. The information circulated the whole time. What was missing was a written stop it could trigger.
Reading: Measure What Matters (Doerr, 2018). The Tyranny of Metrics (Muller, 2018). Weapons of Math Destruction (O'Neil, 2016).
Playbook
A venture with a method learns. A venture without one spends.
Roughly 80% of what any team builds is common work. Innovation lives in the other 20%, and the Playbook is how you get to it sooner.
It runs in stages, called Seek, Make and Build, each broken into small steps. Every step asks one question.
Zero to one is the stretch where ventures burn. The method exists to take risk, cost, drama and waste out of it. Run it across ventures pointed the same way and the repeat work amortizes instead of recurring.
Off-grid solar
Solar lanterns existed for years before they displaced kerosene at scale. What changed was operators shipping the lamp with distribution, consumer financing and after-sales service. The engineering was never the constraint.
Shyp
A courier came to your door, packed the thing and shipped it. It shut down once the cost of the pickup refused to fit the price customers would pay. The app was the easy part.
Ron Adner's two risks are what the Playbook surfaces early. Co-innovation risk: what else must succeed. Adoption-chain risk: who else must say yes before the beneficiary benefits. Neither is visible from inside a product roadmap.
Reading: The Mom Test (Fitzpatrick, 2013). Sprint (Knapp et al., 2016). The Wide Lens (Adner, 2012). Crossing the Chasm (Moore, 1991).
Patient Capital
Patience in a founder's temperament evaporates under a capital call. Patience in the term sheet survives one.
State the horizon before the money lands, then match the instrument to it. What you want is patient money rather than patient people.
Ours is private equity, structured without interest and carrying no leverage. That rules out a set of ventures: anything whose case depends on returning a hundred times over inside a fund’s life. What it rules in is the venture that pays its way, holds its ground and is still owned locally in twenty years.
McDonald's Franchise Realty Corp.
Harry Sonneborn saw that the durable business sat in the land beneath the restaurants, not the food on top of it. Franchise Realty Corp. was formed to hold that land, and the separation has outlasted every menu decision since.
We are setting up the same split. PropCo will hold each chapter's property, and OpCo will run the programs and pay rent.
WeWork
WeWork peaked at a valuation bigger than most airlines, then filed for bankruptcy a few years later, having burned through more investor capital than most funds ever raise. The number came from the rhythm of raising money, not the business.
Patient money is built the other way. It carries no interest, no leverage and no exit date, so nobody needs it back on a date somebody else picked.
Reading: The Citizen's Share (Blasi, Freeman & Kruse, 2013). Owning Our Future (Kelly, 2012). The Infinite Game (Sinek, 2019). McDonald's: Behind the Arches (Love, 1986).