Pro Commerce

Spontaneous Commerce

When Airbnb was first started in San Francisco, I had three friends who immediately got into the business.

Does that mean anything to you?

One was a game developer, no surprise.  He bought three condos and rented them out. 

The second was a salaryman who bought five houses in New Orleans with the intention of moving there to rent them out. 

The third was a psychotherapist who rented out her city apartment for $5,000 a month and stayed at her country farmhouse.

The interesting thing about this event was that two of these emerging entrepreneurs were not the kind of person one expects to start a business.  It says to me that America is a land of millions of potential entrepreneurs who will start a business if they are given the slightest genuine opportunity. This is truly America. Commerce is deeply American.

The first and third were almost immediately put out of business by the rules San Francisco put in place to make Airbnb unworkable. The first friend soon moved to Los Angeles.  The second was soon put out of business by the city government of New Orleans that made Airbnb unworkable.

The CEO of Airbnb is Brian Chesky.  He and his founding partner were both graduates of the Rhode Island School of Design. Neither one had any idea of how politics works. Both immediately conceded to the laws and regulations that the San Francisco government put in place.  Terrible laws that destroyed two-thirds of all the operating BnB rentals in operation.  The anti-business regulations were copied everywhere Airbnb went. The same horrible regulations nearly destroyed similar vacation rental businesses that had been operating for decades, worldwide.

Three lessons from this: 

1. Americans are deeply disposed to starting businesses; no matter who they are. Its American.
2. Government with trivial and irrelevant regulations is the greatest destroyer of business on the planet.

Travis Kalanick, the founder and CEO of Uber, didn’t start his business until he got a Statewide license to run a limousine business which served as a short-term protection against the politically connected and ferocious taxi cab bastards.

    3. Political skills are vital to innovation in business.  Otherwise governments will destroy you.

Google and Me

I understood Google more than a decade before it existed.  Better than it understands itself today.

In 1986 I published a book titled Marketing Without Advertising, based on a course I taught for eight years in my Noren Small Business Institute. It became the third largest selling marketing book in English over the next two decades and sold a 6th edition.

In Chapter One I disparage advertising and promote LISTing, which is what Google is. Google didn’t arrive for more than ten years.  Advertising doesn’t work except for tourists and very young people who lack networks to recommend products and services.  The research on advertising is vast and accurate. As my co-author, Raspberry, used to say: ‘Advertising is poop on the sidewalk that you almost step on.’

Today the internet provides some customer recommendations and warnings which is a modest help but seldom reliable.  Even Amazon is not honest in its recommendations. Listings include all forms of notice about the location and nature of the business.  It includes college alumni lists of current locations, telephone books, almost any reference that a potential customer will use to find the type of business or service he/she is looking for. That is precisely what Google is.  Google is a listing not advertising. It is at least 100 times more powerful than advertising.

When I first saw it used by my clients it was very powerful and effective. I knew then that Google would be far more important than advertising. It was destined to consume 80% of all global advertising.  I bought stock in Google immediately and my shares increased by more than ten times.  Thank you Google.

Jew Hate in America

I’ve lived with Jew hate for several parts of my life.

I was in an El Paso elementary school from 1946 to 1949.  The Mexican kids would follow me home from school and throw rocks at me whenever the Dominican traveling priests came to Juarez to denounce Jews.  Fortunately I was a fast runner.  

The Roman Catholic hatred of Jews abated when Pope John XXIII called Vatican Council II.  The current Pope Francis has brought it back.

My closest friend in 1953-55 was David Stern, in Seattle, whose mother was national president of the American Jewish Committee. That AJC, at that time, was anti-Israel because the members wanted to assimilate and they believed Israel, as a Jewish state, would make assimilation difficult. My father, a reform rabbi, had been in Israel in the pre-State days helping on the Dead Sea scrolls and loved Israel.

I had no personal difficulty with Jew hate, other than the Mexicans, ever again.

I knew about the hereditary-class Jew hate, but it had no effect on me. It brushed up against me in 1967 when I became a bank officer and then the youngest Vice President in American banking at the Bank of California.  The Bank was the home of the hereditary class in 1960s banking but hadn’t always been because my paternal family were proud customers, and board members in the 1870’s to 1900. The bank expected me to join one of the elite private clubs in San Francisco.  The bank didn’t know that a Phillips could be a Jew. Jews were excluded from the top clubs until 1970.  Jews had been forced, sixty years earlier, to take over the Bohemian Club and start the Concordia Club.  I could have joined the University Club where I used the squash courts but never bothered to join.

All my life Spain has hated Jews, the same country that drove my patrilineal ancestors to Holland four hundred years ago, still hates Israel and prizes ham as its top meat.  Ireland has hated Jews and Israel.  The hatred of Jews began when Germany became a belligerent in 1938 and the Irish love the rantings of Hitler to this day. 

I dealt with Jew hate in the mid 1990’s when blacks at San Francisco State University were openly expressing it painting Jew hate murals and attacking Jews on the faculty.  Nearly all of whom left within five years.  Jew hate on campus has never abated.  Largely from blacks thanks to the Black Muslims.  Arabs have since found a home at S.F. State.

I haven’t had to deal with media Jew hate since I stopped reading the NewYork Times in the early 1970s.

A whole new self-hatred of Jews began in the late 1990s’ with the Anti-Defamation League when Lefty Jew hate was beginning and the ADL could only see the non-existent Jew hate in the politics of the Conservative leaders.  The ADL is a bastion of Jew hate to this day, along with the Southern Christian Leadership Conference.

Real home grown American Jew hate exploded sometime in the late 2010’s.  My son calls it “Leftyism on Steroids.”  Which it is.

Spontaneous Commerce

When Airbnb was first started in San Francisco, I had three friends who immediately got into the business.

Does that mean anything to you?

One was a game developer, no surprise.  He bought three condos and rented them out. 

The second was a salaryman who bought five houses in New Orleans with the intention of moving there to rent them out.  

The third was a psychotherapist who rented out her city apartment for $5,000 a month and stayed at her country farmhouse.

The interesting thing about this event was that two of these emerging entrepreneurs were not the kind of person one expects to start a business.  It says to me that America is a land of millions of potential entrepreneurs who will start a business if they are given the slightest genuine opportunity. This is truly America. Commerce is deeply American.

The first and third were almost immediately put out of business by the rules San Francisco put in place to make Airbnb unworkable. The first soon moved to Los Angeles.  The second was soon put out of business by the city government of New Orleans that made Airbnb unworkable.

The CEO of Airbnb is Brian Chesky.  He and his founding partner were both graduates of the Rhode Island School of Design. Neither one had any idea of how politics works. Both immediately conceded to the laws and regulations that the San Francisco government put in place.  Terrible laws that destroyed two-thirds of all the operating BnB rentals in operation.  The anti-business regulations were copied everywhere Airbnb went. The same horrible regulations nearly destroyed similar vacation rental businesses that had been operating for decades, worldwide.

Three lessons from this: 

1. Americans are deeply disposed to starting businesses; no matter who they are. Its American.
2. Government with trivial and irrelevant regulations is the greatest destroyer of business on the planet.

Travis Kalanick, the founder and CEO of Uber, didn’t start his business until he got a Statewide license to run a limousine business which served as a short-term protection against the politically connected and ferocious taxi cab bastards.

    3.Political skills are vital to innovation in business.  Otherwise governments will destroy you.