Eric Jensen

If we learn any­thing from the Wall St. cri­sis it should be this: Sus­tain­able busi­nesses make a profit by cre­at­ing and adding value to the world. Wind­fall “paper” trans­ac­tions are unsus­tain­able and even­tu­ally lead to finan­cial dis­as­ter, and/or the degen­er­a­tion of indus­try. Take a look at this heated debate between 37signals prin­ci­pal, David Heine­meier Hans­son and Mahalo founder Jason Cala­co­nis. The good stuff starts 47 min­utes into the clip. Cala­co­nis rep­re­sents the clas­sic tech approach to busi­ness: raise cap­i­tal, build your model, and sell for a huge windfall…if you don’t go under first. Hans­son tears his argu­ment apart and advo­cates build­ing sus­tain­able busi­nesses that gen­er­ate real prof­its. He describes profit as: “A mea­sure of suc­cess of the impact you are hav­ing on the world…” Jason Cala­co­nis vs.  David Heine­meier Hans­son on This Week in Star­tups What does this have to do with music? Well… In the early days of the record indus­try the busi­ness was much smaller and bro­ken into niches that served spe­cific audi­ences. Music was served up in neigh­bor­hood clubs and record stores. Impre­sar­ios and label own­ers were hard­core fans who under­stood music and their audi­ence. Sure, they wanted to make money, but they did it by mak­ing great records. In the six­ties peo­ple got greedy and very quickly the busi­ness became about sell­ing as many records as pos­si­ble to the low­est com­mon denom­i­na­tor. The huge sales gen­er­ated by inter­na­tional hits under­wrote the enor­mous losses cre­ated by bad busi­ness prac­tices, greed, and stu­pid­ity. Large labels were more con­cerned with groom­ing an “overnight” show-biz sen­sa­tion, than dis­cov­er­ing and…