Ten years ago today, a venture capitalist named Andrew Parker wrote a blog post about Craigslist. In it, he highlighted all the different businesses that the listings site spawned using a version of this image:
As the image illustrates, most of the services that Craigslist offered eventually turned into competing businesses. While others built out the more capital-intensive and upscale versions of these categories, Craigslist served an enormous addressable market (basically all human-to-human exchanges) with a virtually identical, incredibly limited product.
In the years since this image appeared, I've seen its meaning evolve. Instead of an illustration of Craigslist’s breadth, it’s seen as an example of what not to do as an entrepreneur. "Look at all the value that Craigslist failed to capture!" To those eyes, the image is an example of missed opportunity. To mine, it represents the creation of it.
The fact that Craigslist built such a resilient business without trying to keep all value for itself is more net-value positive than trying to own the field. Craigslist would have deviated from its core purpose (which is offering the same limited functionality for essentially everything), likely dooming it in the long run. And even if they did somehow succeed and own these markets, that would’ve ultimately been worse for the world.
One of the better articulations I’ve seen of the Craigslist mindset comes from the blockchain world. The Ethereum Foundation’s Philosophy of Subtraction lays it out like this:
The left-hand column is what’s normal today. Business schools teaching digging moats around value instead of how to help it grow and spread. The right-hand column is closer to a Craigslist approach. Few companies have tried harder to matter less while being used by so many people as Craigslist.
A world where more organizations adopt a philosophy of subtraction would be one where companies create and distribute value rather than seeking to capture it. This wouldn’t mean the missions or impact are any smaller. The subtraction mindset shifts success from Me to Us, making collaboration and differentiation legitimate strategies for success instead of impediments to it.
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