Yesterday I came on an article about Gridley Bryant. I can’t say the name was familiar to me and yet he was an inventor of things we still use today. For context, he built the first commercial railroad in the United States, at Quincy Massachusetts, in 1825. He did not patent any of his innovations and so his connection to them is lost. The railroad roundhouse is one, but the one that caught my eye was the Railroad Frog. I think because I have seen them and never paid attention.
Bryant built it because he needed it for his business and took it for granted thereafter.
You’ve seen them too. They allow two railroad tracks to cross each other.
Shopify is one of the most valuable businesses in Canada. How does it relate to railroad frogs?
You can get a clear idea about how to create a business from a Farnam Street podcast with Tobi Lutke. If you have a business or would like to have one, you should not miss this. You will find many important messages you can apply. Just remember Shopify is 15 years old. They became an overnight success after 10 years of intense mistake making and innovation.
The cheapest experience is someone else’s experience. As an example, these are four things that came up in just 10 of 105 minutes of the presentation.
You would take years to learn those if you go the do-it-yourself route.
Learn from biographies. Not the obvious but the underlying realities. Rockefeller was not primarily in the oil business, he was in the oil refining business.
Silicon Valley has important resources of people and their skills, but those are available elsewhere. Sometimes you must improvise.
Understand the keys to your business and recognize when you look back a decade later, even if you are successful, you will score yourself poorly. Be willing to change to improve. Seek change from others.
Complex systems obscure cause and effect, so you must look deeper to secondary and tertiary effects. Few do.
Tobi Lutke treats it as the discovery of things that don’t work. That is the positive way to view mistakes.
You need to know why you made the choices you did and then discover how they could have been better. That is a nice approach but you must have a system to capture your thinking when you make the decision and a way to compare outcomes to that decision. You must do it too.
“I try to never waste a mistake”
Shopify began in 2006 and became a public company in 2015. In 2021, they support 1.7 million venders in 175 countries. If you listen to Tobi Lutke, you learn that evolution drives business. The advantage of small and new is the range of variables and interactions is limited. The nine years it took Shopify to become public is not so far from normal. Over that time you improve exponentially or you fail. The growth of skill is exponential, but only if you pay attention. He definitely does and knows why and how he does it.
An example, If you can improve at 50% per year, easy enough in the beginning, in nine years you will be 40 times better at what you do. Even if that slows down as you grow, 20% growth in skill and processes is huge.
The payoff is enormous. Mostly because businesses tend not to improve their strategic vision and their processes as they learn more. It is far easier to tinker with the details. The payoff to keeping on top of the big picture is profound. A Lutke question. If I just took over this business, what would I change?
Shopify became a public company at $17 per share. $10,000 invested then is worth about $1.1 million today. More than 100 times your investment in six years is surprisingly rare.
If you own or think you would like to own a business, listen carefully to the podcast. Success is not an accident. If you listen every six months you will see why some of the ideas are more important than you expected. Eventually you build something of value. Nonetheless you will still look back and assign a 6 out of 10 to your methods.
Be like Tobi Lutke and try to build something where you are able to see a 7 out of 10. Always improve.
Be willing to find your errors. There will be many. Ego is not your friend.
You will find value and some ideas here. The Observer Effect.
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