Mark Cuban proposes his contribution to the Stimulus Plan by allowing entrepreneurs to post “business plans” as comments to his article Open Source Funding. His criteria in a nutshell – business plans are posted for all to see, comment, and steal if they want. Mark sends a non-negotiable contract for funding.
I’m glad Mark is using his media fame to push this financing model into the mainstream.
Stealth is no longer an efficient way to build a business model. In stealth, the world can’t provide feedback for the countless iterations required to fine tune any business model – funding, marketing, product development. In both my blogs Media Transparent and Transparent Real Estate, I propose new business models and strategies up front for feedback. This action does three things: 1) Like an academic publication, it brands the idea, 2) It provides feedback for iterative improvements, and 3) It attracts like minded thinkers who might be partners or supporters of the initiative.
Open source funding is the most efficient way to develop a business model because the most qualified entrepreneurs with the appropriate domain expertise will “rise to the top”. As Mark says:
If it’s a good idea and worth funding, we want it replicated elsewhere. The idea is not just to help you, but to figure out how to help the economy through hard work and ingenuity. If you come up with the idea and get funding, you have a head start. If you execute better than others, you could possibly make money at it.
I agree that in aggregation, the most efficient and productive business models (combined with the hard work) will create economic opportunities. That’s why stealth startups run by 24-year-olds based on an idea won’t work; their lack of domain expertise won’t ever get them funded for anything in an open source world. VCs can be just as guilty… they use stealth to keep ideas hidden among themselves so they may leverage negotiation power over entrepreneurs.
This transparency of business models should be extended across industry disciplines. Last summer, I created the Management Consulting 2.0 slideshow explaining our philosophy that consulting should be open source, not a closed book of research done behind McKinsey doors that can be charged out at $750/hour.
