Sunday, February 12, 2012

Social media and the rise of NANOCAPITALISM

What the hell does microcapitalism mean?  I guess it is a fancy way to say small business development, but I call it that for several reasons.  Below is a definition I got off the internet.

"Microcapitalism, an idea that capital should not only be in the hands of private citizens, but in the hands of as many private citizens as possible. Seth Godin has published several books an articles on this, including Small is the New Big. Microcapitalism is, in fact, an old idea. The idea that the village blacksmith, the family farm, and the general store owner should own their business, the land their business sat on, and take full responsibility for their production and income are as old as civilization itself." (

To me this is just saying that microcapitalism is about small business and having your own business that you control.  It does not discuss how you form, build and execute your business.  This concept seems redundant in the current permutation of the business landscape.  It does not take into account the manner in which the future of business will run or in some cases already running. 

I would submit that with maturation of e-business and the advent of the market research age of e-commerce (as I like to call it the 3rd generation of e-commerce...generation 1 was the storefront, generation 1A was the backbone of the storefront, and generation is the marketing age of social media sites), one can begin to view to future of microcapitalism...nanocapitalism.

What is the difference?  Nanocapitalism takes a small business and breaks into even smaller pieces.  The aforementioned view of microcapitalism suggests that individual owners own their business.  It assumes that people will put the brick and mortar in place they need to run the business.  Tangible assets that report to the leader of a business with a goal of generating revenue and control for the owner and their partners.  Those who work for the small business are still employees. 

Nanocapitalism's foundation is based on a more networked model of running a business.  My good friend Cindy McCann owns her own business called customer performance solutions.  Her business is based on providing customized training and consulting to help educate the workforce efficiently and effectively.  She has worked with me providing 3rd party support for an education strategy I own.  She is my partner and although she does not work for my company, she works along side me as if she does.  What makes her business a nanocapitalistic model?  She can bring ANY resources to bear to solve our issues on an AS NEEDED BASIS.  If I need video...she is connected to another small business owner who she can charge us for to use on an as-needed basis. 

She only carries the resources she needs when she needs them to provide the services her clients needs.  It is a network business model that helps ALL microcapitalist owner function and OWN what they kill so to speak.  So big whup...this is just a networked business model.

I have written before about why the dot com bubble won't happen again and it has to do with evolution of ecommerce.  Social media as stated above is the 3rd generation of ecommerce.  The marketing of individuals (trying to be their own brand and nanocapitalists in their own right) are now generating the content to allow businesses to study the marketplace. 

Over time we are already seeing the 4th generation of ecommerce coalescing.  It will be the advent of sourcing talent.  And I don't simply mean sourcing microtask workers...we are talking about expert talent.  As the concept of crowdsourcing works its way through the value chain we can imaging our ability to find people in the social media sphere will actually become the vehicle to enable businesses to run themselves with little to no infrastructure.

In the future, I could source all parts needed to create a business;  my virtual storefront (1st generation ecommerce), my marketing efforts (2nd generation ecommerce ala facebook/twitter or other not yet seen products), study my market (3rd generation media analytics) and finally source my company's talent to run it (4th generation ecommerce...the talent pool).  In this future state we will all be microcapitalists connected through the nanocaptialist network of talent. 

As Cindy says, not a moment before they are ready.  Are you ready to think about your entire business as being yourself sitting in a room with a phone and computer running what could be a vast network of people getting the right things done at the right time.  I guess we will need to have better ways to connect that talent to monitor its way of doing things.

The fun is just beginning it is a matter of time before the size of companies shrinks because you can own your culture, your methods and your time at a higher profit margin that carrying overhead that you don't need.  You will be providing service as a small part of a vast network and thus the rise of nanocaptialism begins...

As it pertains to the cross section of small business and technology some might say that small companies who are technology saavy would fit into the concept that HOW they do business is microcapitalism.  If this were true however, the way the provide value to their customers/consumers would be fragmented.
So what am I getting at when I mention the term microcapitalism.

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