Consider a Cautionary Tale

An Internet development firm with an outstanding reputation is sold to an offshoot of a major U.S. corporation with one of Silicon Valley's real legends on the Board. The corporation gets the firm. The proprietor goes for an exceedingly valuable bundle of shares about to be floated on the U.S. Stock Exchange. The purchaser takes over the premises, staff, equipment, checkbooks, records, Intellectual Property Rights (IPR), and so on—and then doesn't float.

In that position, what can you do? Sue them? You have no money as the transactions are entirely in the form of shares, which still have a two-year Securities and Exchange Commission embargo on them.

The next day they call you and trump up some charge that you are in breach of contract. When countercharged, they offer to give you back your firm and return the transaction. That might have been interesting a few months ago but you had mentally been psyching yourself up for a new venture and working out on which Caribbean island you were going to build your dream villa. In the meantime, they subleased your premises, fired most of your staff, transferred the best contacts to the parent organization, and sold every asset they could. Someone tips you off that the purchaser desperately needed extra credibility in an attempt to get itself publicly listed. A few months later the corporation sells what's left and shortly goes into liquidation.

This story, though far from typical, is far from unknown in one form or other. Success is not a full stop. When you reach your first objective, you have to decide what should come next. Unless you are planning to sell, this means beginning all over again, albeit in a better situation.

You have been through it once. You know where you are strong. You have a certain amount of money, and premises presumably, as well as people and contacts. You may have a very definite idea or possibly too many. The big question is to what extent are you truly suited to what you are going to decide?

Running a large outfit doesn't appeal to everyone, and it is not automatically more profitable despite what friends and family may think. If you find a larger operation daunting, and most people do at some point, the most mature thing you can do is to set your pride aside and broker the business while you are holding the aces. You don't have to sell it all; you can retain that slice of the action where you truly excel. You will do much better for yourself in the long run being best at what you can do than scraping by at what you can't.

Whatever you decide, it is an important decision. My advice is take a vacation. Recharge your batteries. Listen to those you hold most dear. Consult your inner voice. Take your time; but not too much time. Competitors are bound to have noted your success. They will be looking for your program's limitations. They may underestimate the difficulties of improving it and overestimate the money to be made. So one of your prime objectives will probably be to tighten up your program. The better your program, the more people will like it and the costlier it will be for any competitor to steal a slice of the action.

Competition can come from three sources:

♦ Small outfits who don't know their limitations

♦ Bigger outfits who are angry that you developed an area they were always about to move into

♦ Really large firms who are determined to have the lion's share of your cake

You are going to have to watch all three. The small outfit may just be very smart indeed. The bigger outfits will probably invest much more money than you did and come out with an unremarkable product with one significant plus. A really big firm may well wait years; then just as you are about to make the big time, they will put in an offer. If you don't sell to them, they may well develop a competitive product and swamp you. By the time they get in touch, they may have executives and technicians who have been watching you for several years and know almost as much about your business as you do.

That's the way business is. Some people thrive on it. Others don't. You just have to be true to yourself. If you are sensible, and you would hardly have read this far if you weren't, you will probably come out well in the end. In the interim, you inevitably will have to make some important decisions. The most crucial one is likely to concern staff. Those who have helped you deserve appropriate rewards. In some instances this may take the form of a raise or a title. However, it could easily take one or more of the following forms:

♦ Recognition

♦ Share options

♦ Other perks and prizes

♦ Further training or some assistance with their personal development

Doling out the goodies is an act of acknowledgment not propitiation. So there's no point in making things hard for yourself. Ask yourself whether the people who have helped you so far are the people you need for the next leg of the struggle. To decide this objectively, you are going to need a fresh staffing plan. Inevitably, some people will fit and others won't. It may be possible to move some of the square pegs into slots better suited to their capabilities, but if you haven't got room for them, you haven't. Bear in mind that holding on to them may prevent them discovering their real areas of excellence. When you sever the cord, remember that no one who chooses staff is ever infallible; be humble, even apologetic, but firm.

The next thing you have to consider is what changes you need to make to working conditions and rewards to keep the people you do want. Motivation isn't necessarily about more money or options or cream in their coffee; it can be spending more time listening to them so they feel they have more of an input. It can be sending them on courses that increase their expertise and enable them to grow. The most successful leaders are those who build those underneath them.

As you may have gathered, there are a lot more adventures in store once you achieve your first major success. One of the most practical things you can do to get up to the next level is to go back to the beginning of this book and go through the process of creating software successfully again.

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