Building to flip is building to flop 17 Jan 2006
21 comments Latest by Anonymous Coward
If you’re about to build anything, don’t build it to flip or you’re almost guaranteed to flop. Sure, you could win the Yahoo lottery, but the odds aren’t in your favor. If 9 out of every 10 new companies fail, I can’t imagine the minute percentage of successful acquisitions. 1 in 100? 1 in 1000? Worse?
Believe it or not, it’s far better (and easier) to build a small, profitable, healthy company that sells a product or service to a thousand small customers than it is to sell to that one magical big buy-out customer.
Secondly, name a great company that was built to flip. I can’t name one. Great companies are built to build, to grow, to mature, to make a difference eventually. Not to sell to someone in a couple years. A sale is a side-effect of building something great, it shouldn’t be the motivation for building something great.
So, if you’re shooting for mediocrity and trying to win the lottery, good luck to you. If you want to build something great, best success to you.
UPDATE: Om Malik wonders if the falling stocks bring shopping sprees to quick halt.