On creating software and economic development

I've started reading Marc Andreessan's blog recently (http://blog.pmarca.com/). I find it interesting to contrast Marc's view on everything with Eric Sink's blog (http://software.ericsink.com/) 

For those of you outside the business, a little perspective may be necessary. Both men are fellow University of Illinois Alumni. (At almost the same time, I think). The biggest difference is in the type of careers they've had.  Marc was one of the founders of Netscape, and has since been involved in several tech startups, as an investor, founder, or director, or some combination of them.  (His current project is Ning, www.ning.com). Marc long ago left the cornfields of the midwest for the culture of Silicon Valley.
Eric, on the other hand, has been involved in a few startups that were self-funded.  His current company is Source Gear (www.sourcegear.com). And, of course, he's Not a Legend (http://notalegend.com)

The contrast between these two men is pertinent for the Southeast Michigan area, which is trying to diversify its economy away from its heavy automotive roots. Marc Andreessen's career is a series of highlights: Big money deals, some of which succeeded beyond expectations, and some of which were tremendous busts. Eric, on the other hand, has been slowly but surely building a small to medium size company with a real market and a real product. They are both successful, but in very different ways.

Both of their blogs are interesting reads.  Marc's discusses the world of high finance, raising capital for startups, At times it feels like everything is at a rushed pace. Grow fast, develop product fast, hit the right market fast, and liquidate fast. All the risks are big, and all the potential rewards are big too. Eric's blog discusses how he built Source Gear while in Champaign. There was less venture capital available (he was in Champaign after all), the market he entered (developer tools) wasn't one of those classic 'hockey stick growth curves'. As a result, he simply focused on product, the market, and building the company.

Both are interesting reads, but with a different focus. 

So, what does this have to do with business in Southeastern Michigan?

Well, some of the advice is clearly applicable anywhere: focus on your market, (high tech only) recruit and retain a great product team, don't waste money, and preserve your reputation at all costs.

However, the differences between growing a company slowly (like Eric) and getting on the VC roller coaster (like Marc) are striking. I'm not taking anything away from Eric, but there is less risk in the slower growth path than in the VC funded path. (Note 'less risk' here is comparing a moon landing with a mars landing. Neither should be considered easy, or safe.)

And Marc is very blunt in his commentary about the pull (both logical and physical) that VCs will exert on their funded companies. So because of that, I'm concerned about current public policy in Michigan focusing on VC funded startups to the exclusion of everything else.  In short, we need every Eric Sink in our back yard to stay, and grow, and be encouraged. Of course, if another Marc Andreessan is around, we need him to stay as well.