Reinventing Business
Discovering Your Best Organizational Structure

Friday, March 21, 2014

Business Books and the Unreliable Narrator

The Unreliable Narrator is a literary device wherein the reader somehow discovers that the story's narrator is not entirely credible. It's not a technique for beginning writers, but in the hands of an expert it can add some fascinating depth to a story. It is however, a technique for fiction.

I finally finished Steve Denning's The Leader's Guide to Radical Management. In the process, I realized that the reason most business books are difficult reads is because the authors are, unintentionally, unreliable narrators.

I've identified two forms of unreliable narration, both of which tend to appear in most business books:

  1. The author has a hidden agenda. In most cases, the author wants to set themselves up for consulting and/or speaking engagements.
  2. The author has something that they either assume is true, or want to be true, and are not rigorous about verifying correctness or following through on the reasoning.
Once you notice either or both of these in what you're reading, it slows you down tremendously. Suddenly, each assertion by the author must be filtered and evaluated; weighing it to see whether it passes the credibility test. And that's the problem with the majority of business books; as I chronicled here, they are typically subject to sloppy thinking (for which there is virtually no penalty in the business-book economy).

Denning is doing good work, challenging the system from within the system. Perhaps it's just confirmation bias but I've found many of his blog posts to be quite inspirational -- they often act as affirmations that I'm not alone in this and I'm going in the right direction.

The book is on the same topic as his blog. Indeed, it's clear while you read both of them that Steve really wants to make "Radical Management" his "thing" (see point #1 above). In fact, he takes the bold move of treating it like it's already a thing, writing about it as if it has already been established. And he's done a lot of outside work to publicize his concepts and work with organizations to adopt the ideas.

The book is filled with good research (well, research that correlates with what I've read elsewhere, which could just be the echo-chamber effect that is often prevalent in the business-book scene. As if everyone was just reading the most popular business books and accepting any research presented in those books. But let's assume that he's being careful). The book contains lots of valuable information and is trying to look at management differently. It's worth reading.

But Radical Management as a practice isn't a thing. It's clear whenever he writes about it because his writing becomes tentative. A perfect example is his reference to
"It astonished the world of software development by successfully completing a transformation from traditional management to the practices of radical management in three months."
Notice the careful wording: not "radical management," but "the practices of radical management." I have some insights on this one. was very successful in moving the whole company to Agile Development all at once. However, there was not any endorsement of radical management, and to try to piggyback onto an example of Agile success is disingenuous.

Radical Management asks the question, "what would Agile Development practices look like if you applied them to management in general?" and then tries to imagine the results. It's obvious these are ideas that Denning thinks might work, but that haven't been tested. Indeed, there's almost nothing to test -- the maxims of Radical Management are cast in vague terms about the way a manager should behave or act or feel. But there's nothing concrete about how you either find or create such managers, just that somehow, somewhere these practitioners of enlightened self-interest not only exist, but want to come work for your unenlightened company and change it.

He also seems to fall into the belief that existing hierarchical bureaucracies can be reformed into bastions of Radical Management. I believe I've seen mountains of evidence to the contrary which makes me conclude that no established power-based organization can be reformed if it means loss of power for the entrenched. That's why the only kinds of management restructuring we see in such organizations are those that don't really change anything, but just rearrange the deck chairs. Anything of true substance requires a redistribution of power, and people who fought to get into power don't want to give it up. Radical Management is still targeted to managers (aka consulting clients), despite Denning's own (very compelling) criticisms of bureaucratic hierarchies.

I really do understand the desire to come up with a system or process or idea and have it be your thing. In an early C++ book (pre-Thinking in C++) I "invented" (made up) a software design methodology and described it in the book. It seemed like a good idea while I was writing it. And I presented it as if it was already a "thing" that people used. I have no excuses for what I did. It was hubris. But I was punished: someone took the book and made a video training course from it (part of the publishing agreement, as I recall). I'm pretty sure it was on VHS tape, which is why you've thankfully never heard of it. And I had to watch as this guy got to that chapter and presented my totally-made-up methodology as if it were a real, tried-and-tested thing. I still carry mental scars of embarrassment from seeing that, and it makes me want to present things that are genuinely useful and testable. I still fail, but I do try harder.

The root problem with Radical Management is that it tells you how to be, rather than what to do. You read the descriptions and think "yes, it would be great if you could do that, but how?" Which ultimately means there's nothing to test, and if you can't test it you can't disprove it: not science. And I do know that Denning refers to The Lean Startup, which tells you what to do to test your hypotheses, but not how to be. An effective system probably needs to tell you both what to do and also what to expect (and how to adjust if you aren't getting those expectations).

The writing is inconsistent. Just when I'm about to give up from too many pages of business-speak, his true voice comes forward -- he hits his stride and I'm grabbed and re-engaged. I know it's hard, but the whole book needs to be written in that true voice. If you do that, Steve, people won't be able to put it down.

If Steve Denning reads this, I really want to emphasize that I mean no discouragement. I think he's doing good work, and should continue. It's just presented in a way that is unusable as a system. In this business-writing world where the vast majority are actively trying to fool you in order to make a quick buck, I'd hate to see his work lost because of this mistake -- and I think that, with some hard work, Radical Management might be reformed into an applicable system.

Tuesday, March 18, 2014

Airline Pilot Hours

Frequent travelers may have had the experience of being delayed because a pilot's monthly hour allotment has been exhausted. I've even heard of people planning trips at the end of a month in order to get benefits when they get bumped.

I've been bothered for awhile now about various attempts to reduce overtime. Some of these fail because managers just can't bring themselves to believe that less time worked can possibly be better. But those are fairly obvious failures.

The tricky ones are those that seem to mean well and are misguided or misused. Take for example the sudden popularity of "infinite vacation time." The early adopters have reported that people take less vacation time when it is infinite, so there's been a pile-on by less-scrupled organizations.

I like the idea of the Results-Only Work Environment (ROWE). Unfortunately, if we have a culture where people program emails to be sent at the wee hours of the night so that everyone can see that you're always working, well, changing that is not as simple as declaring that "now you're a ROWE workplace."

I don't think people are going to suddenly stop working excessive overtime just because you tell them it's OK. Who knows, in some organizations it might make people work more hours (if you can even imagine Microsoft changing to ROWE, do you think that their hyper-competitive environment would suddenly change?).

What if we turned things upside-down? Like, seriously upside-down.

Imagine starting at a job where they tell you're paid by the hour, and the maximum number of hours you can work per week is 20. If you work more than 20, you don't get paid for the extra time. There would probably be some way to borrow hours from the past or future, but only up to a point.

When I'm in the middle of a project, 4 hours is the most I'm good for. I often try to work more, mostly to get that feeling of accomplishment, but the time is wasted. I'd be better off stopping and doing something else, recharging my batteries. When I've had jobs where I am expected to be there for 8 hours I feel uncomfortable, because the company is not getting the best value for their money.

For this same reason, a friend has been trying to find a company that will hire him for four hours a day, for which he would be a fantastic bargain (get eight hours of value and only pay for four!). So far, no takers ... the companies explain that they only want full-time employees ("we're desperate to hire programmers, but not that desperate!").

Equating hours with productivity is one belief from the factory age that isn't going to give up easily.

I wonder if implementing airline-pilot hours might have a similar effect as time-boxing. Without infinite time, you really need to focus in order to get things done.

Saturday, March 15, 2014

Just Manage Harder

This Harvard Business Review post nicely summarizes some of the fundamental problems of last-century management practices. The results: only 30% of US employees are engaged, and only 13% of employees worldwide are engaged, for some definition of "engaged." Result: "the vast majority of employees worldwide are failing to develop and contribute at work."

The article then jumps to the conclusion that it's all about great managers. The solution is simple: "To make this happen, companies should systematically demand that every team within their workforce have a great manager." Apparently one in ten people has the ability to be a great manager, so all you have to do is figure out who those people are and make them managers!

The whole essay smacks of "Business Science" (that is: not science). I have far too many questions about how they jumped to their conclusions:

  1. Perhaps a great manager is just someone who separates you from the bureaucracy of the larger company, and creates a space that's different, where people can thrive. If so, that's a very different skill set than the manager this article is seeking.
  2. The manager described might not want to play in the mess that is traditional management. I suspect I'd be a good manager -- my experience organizing conferences might support this. But I don't want to try to compensate for your corporate dysfunction. Sounds like hell to me, so I won't even show up on your radar. I'd only want to work with a company that's already so different that it doesn't have the problems the writers describe. Would the role of "manager" even exist in that company?
  3. With such miserable results, the writers never consider the possibility that "maybe you're doing it wrong."
It's not surprising to hear this from HBR, published by perhaps the oldest of the business schools in the US. The answer is always going to be "more management." The management paradigm itself is unquestionably sacrosanct; it's just a matter of tuning one part of it or another, propping it up until it works.

How miserable do the results need to be before the answer is not "just manage harder?" In Radical Management by Steve Denning (another HBR writer; I'll be reviewing this book in a later post), he revisits the Hans Christian Anderson tale, "The Emperor's New Clothes," and makes a striking observation: the important thing about the story was not that the emperor wasn't wearing any clothes, and it wasn't that a child pointed it out. It was that everybody ignored the child

Tuesday, March 4, 2014

Transparent Salaries + Activities

In this article about how Whole Foods has pay transparency, notice that CEO John Mackey has to explain what people have done to justify their salaries. But what if that was attached to the public salary information, so that you see the number, and why, together? Your performance review, for all to see at all times.

Managers would have to be comfortable with more dynamic change, because it would in effect create a marketplace. As soon as you had accumulated enough "credits" added to your company CV, you could ask for more money, rather than waiting for annual salary reviews. And your abilities and achievements could be compared to the larger marketplace and if you fall behind your salary might go down.

Making it public might reduce or eliminate most of the difficulties faced in the way we determine salaries now.

Atlassian has been trying to change their performance review process.

The Limits of Open Spaces

Last week was the Java Posse Roundup, and as usual it was a great experience that puts to shame traditional "eyes forward" events. At this point, I virtually never go to traditional conferences unless I'm speaking at them -- speaking engages me and increases the chance of having interesting conversations. But much of the rest of such conferences are usually disconnecting experiences, except for the serendipitous moments when you fall into discussions.

Open Spaces formalize those discussions so they are no longer serendipitous but rather the norm. You spend your time connecting in numerous different ways (one reason it works to hold it in a resort town is the outdoor activities provide additional fertile ground for connection and discussion). I've actually been a little overwhelmed by the strength of some connections, and how important the conference can be to people, but a friend casually referred to it as "a retreat experience," pointing out that things like this always happen with retreats, and it was a sudden insight: "Of course, that's what it is, a retreat experience!"

Attendee Julie Pitt made an even deeper observation: Open Spaces are an exceptionally good way to distribute our collective knowledge, but the best we can do within that structure is to bring us up to the same level of existing knowledge -- of things we already know. Other than a few accidental sparks, it doesn't take us to places that someone in the group doesn't already know.

Just as Open Spaces turns the traditional conference structure on its head, what experiences can we create to produce new ideas and insights? I immediately imagine a workshop with structured experiences designed to stimulate visionary thinking, but am I once again trapped in my preconceptions? People have been putting on creativity workshops for some time now, and I don't know of any revolutionary insights emerging from them. I don't want to teach techniques that you later use at home, but instead to create a collective experience from which ideas spontaneously emerge.

Hmm. Maybe I should look around for some creativity workshops/experiences to see what they do, as a starting point.

Friday, February 21, 2014

My "Reinventing Business" Presentation Video from OSCON 2013

The O'Reilly folks have just posted the very-nicely-produced video of my "Reinventing Business" presentation. I'm quite pleased with the way it came out and feel like it's a good summary of my progress so far.

Tuesday, February 18, 2014

Founder's Syndrome

I came across this in Wikipedia. When I was 9 or 10, myself and a group of neighborhood kids built a compound in our back yard. It had fences, a hut made from bamboo, and the piece de resistance, an underground fort.

I decided that I was the boss of everything. In effect, I was the chief investor since it was my yard, and most of the materials came from my dad's stash.

Alas, this investment was not enough -- capitalism failed me. All those whom I had imagined my minions decided that they had higher aspirations and stopped showing up. Only after I had been appropriately humbled did people start showing up again.

I guess if you're paying people (and the economy is bad) then you have more control over them. But even that isn't always enough, and it also doesn't seem to bring out the best in the minions (the minions in Despicable Me notwithstanding; since Gru appears to be the only villain with minions, it seems just as likely that he has genetically engineered them for loyalty -- a Taylorist's wet dream).

Monday, February 17, 2014

Github and Mozilla

Both Github and Mozilla are distributed companies at their core. Mozilla is about open-source development so requiring developers to be in one place has never been practical, and a large portion of Mozilla developers are not company employees so they wouldn't move anyway (although it's important to include them, as Mozilla does in some of its big meetings, where it flies contributors to attend). Github's goal is to support distributed development, primarily through the Git distributed version control system (DVCS), and in their case they use their own system to accomplish this ("eat their own dog food," aka "dogfooding"). Over half of Github's employees are not San Francisco residents, so Github puts in a lot of effort to make sure the remote employees will have as much connection as possible. Often this is in the form of hi-tech, high bandwidth communications, but it also includes bringing the employees to San Francisco for periods of time so they can steep themselves in the experience.

My visit to Mozilla concerned a different project so I only peripherally heard about the (relatively flat) organizational structure. I went to Github specifically to get a feel for their organizational structure.

Github has recently moved into a new building, and they've really done some fascinating things with the interior design. New visitors go into the "oval office," a reproduction of the US president's office in the White House. The entire first floor feels something like a cross between a restaurant, a bar and a theatre. It is created not only to host visiting teams (who periodically come for meetings) but also as a general workspace. The second floor makes me think of a library; you go there when you want a quieter experience and to focus. The third floor is more energetic, with music and conversation, like a cafe. The top floor opens to the rooftop deck, which isn't large -- it might seat 30 people or so -- but you're outside and can see buildings and the bay, etc. Because, like a coworking space, you can set up anywhere, apparently Github has a system to allow you to locate someone if you need to talk to or work with them.

This is an interesting pattern I've noticed, this diversion from the "open office" plan where you have a fixed space with all your stuff, but no cubicle. With cubicles or "open plan," you're still in rows and you still have your assigned spot, and so if it happens to be a noisy area of the company, or if it's too quiet for your tastes, you're stuck. But in the new approach (enabled by laptops), you can get up and move to any location you want, to suit your mood and your needs. Meetings & workgroups can spontaneously form anywhere, or they can use one of the closed-off spaces. The open office plan has taken some well-deserved flak in recent times, but perhaps this modification can solve at least some of those issues.

In the last year I've become a big Github fan. I've been using version control for nearly 30 years (!), starting with RCS when I worked at Fluke. With RCS we learned that a lot of it was flaky and unreliable, if not downright broken, so we tended avoid using anything except checkins. Branching and forking and all that was not considered trustworthy. And for 30 years I kept to that practice, using version control as a basic storage repository. So when Github created graphical apps for the different OSes, I was quite surprised. What, no learning the command line? Even better, the things you do most of the time are part of the app -- one of the biggest problems with command-line programs is that everything appears to be the same level of importance. The Github app makes it easy to do the things you usually do, and it also shows you what those things are! That's what made me a fan -- they worked to make things easier for me.

Github is a bootstrapped company. They were making a profit before taking any investment money, so they got used to charting their own course without investor guidance. 1.5 years ago, they took a 100 million investment.

Github's widely-touted way of working is "everyone works on what they want to." The fact that they've been as successful as they have using this approach speaks, I think, to the idea that when people really like working at a company, they tend to work towards the company's best interests. Now that they have a "runway" (a limited period of time before the 100 million investment is expected to pay off), it will be interesting to see whether the pressure from investors changes the working style of the company.

Bucking a common trend, Github does not provide lunch. This was a carefully-considered decision. Not only does its location provide access to many restaurants within walking distance, but Github's goal is to reach out into the world, so this was seen as a more appropriate path than, say, Google's choice to try to keep its engineers rubbing elbows as much as possible (which Yahoo is duplicating). This clearly works well for Google, and had I been in grad school when Google was around it might have looked very attractive -- like more grad school. But these days I wonder how one might create the minimum number of carefully-considered constraints within a company, and what the result would look like.

Thursday, February 13, 2014

Coworking and Hackerspaces

During my company visits in San Francisco, I stayed with my friend Bill who lives right on the Bart line in Walnut Creek, so I was able to take that in and avoid the hassle of driving in the city and the struggle to find parking. For the visit to Github, I walked down 2nd street from the Bart station and started noticing what seemed like an abundance of coworking spaces. I had a little extra time on the way to Github so I stuck my head into the first one I saw, Citizen Space. I had to squeeze between a dumpster and a UPS truck to get into what looks to be a converted warehouse. Inside it seemed nice enough, predominantly couches placed throughout the space. The person at the door did not have time to give a tour but I could get the idea from a quick look, and from their web site.

On the way back from Github, I noticed that there was another NextSpace on 2nd street, and a little further on, a third coworking space called WeWork. Although I couldn't visit on that day, I will try to get a tour in the future because the posters outside of WeWork claim that it is a "physical social network," and it looks like they might have gone further than most to achieve that.

The strongest observation that keeps coming to me about coworking spaces is that no one actually needs them. Everyone has their own internet, and everyone has at least a little space on their own kitchen table where they can set up their laptop. Why, then, do people go to the trouble of schlepping their stuff to one of these places, and paying for it on top of that? The only answer I can think of is what WeWork and NextSpace seem to be emphasizing: connections with other people, everything from just being around other humans all the way to help and collaboration on projects. (Hmm. I wonder if there are people who are members of more than one coworking space -- if one is full on a particular day or if they want variety, they go to another).

This hypothesis was reinforced the next day when I was walking through San Francisco's Mission District on the way to another meeting, and went right by the NoiseBridge hackerspace. After my meeting, I returned and tried to figure out how to get in; finally someone on their way out opened the gate. That part of the Mission district "has a lot of character" and you'll note from the NoiseBridge web site that they explicitly say that they aren't a place for people to sleep. During my visit there was someone there who was apparently schizophrenic and hoping to do just that. The space is quite large for downtown San Francisco and costs them $4000/month, although the rent is slated to go up. All of this is paid for by donations (mostly from private individuals, not companies) and a little from member fees, although you don't have to pay to use the space.

Decisions were made by a board, using consensus. Apparently this was a very painful process, because when I gave a brief description of Holacracy, the board member I spoke to seemed quite interested.

The man who gave me the tour confided that he could do everything in his own garage that the hackerspace provided -- but he didn't. In the same way that people come to coworking spaces, he liked to come to NoiseBridge and be there instead.

Monday, February 3, 2014

NextSpace Coworking

At this moment I'm set up at NextSpace, which has nine locations, mostly in California. I'm in the San Jose space.

My first experience with coworking was a visit to a place in Manhattan, which was not particularly exciting. NextSpace is quite different, because they put a lot of effort into helping people connect with each other. You can certainly come in, find a place and just focus on your work, but there's also a fair amount of conversation going on. Back when I was living in the bay area, writing books in solitary, some of this kind of interaction -- even if it was just some background discussion -- might have been really helpful.

Most people are just working on computers, something they could certainly do at home, probably for just the cost of carving out a space and getting an internet connection. Thus, significantly cheaper than having a space here. And they also have to commute here from their homes, a very inefficient waste of time. So I think it's pretty safe to say that the predominant reason people are here is to be around other people, for whatever need that satisfies.

Each NextSpace office has a "community curator" and a "community builder" whose jobs are to know everyone and what they do so that if someone has a need that another member might satisfy, they can put them in touch (they also keep track of everything in the office). This is a rather fascinating reversal & bottom-up approach to an office: instead of owning every job in the form of an organization, people are just around, working independently, and sometimes they can help each other. This might produce the same effect, or even better, than the more planned approach taken by a traditional organization.

NextSpace will sometimes have speakers and other events, and hosts a Friday afternoon mixer hour as additional ways for members to get to know one another. I found myself wondering whether additional experiments could yield even better connections.

NextSpace has a number of different kinds of memberships, the most important of which are:

  1. Cafe: you can use any open space
  2. Workstation: you have a dedicated space including if you want a permanent computer, along with some lockable storage.
  3. Office: around the edges there are a number of offices with doors that close.
All are month-to-month, so if you start to expand you are not locked into a lease. If you're just passing through you can buy day passes.

There are also some conference rooms. Your membership includes a few hours a month, and you can buy additional hours.

The general feel of the place was nice. It's much like what I get from working at the local coffee shop in Crested Butte, although that doesn't provide some of the services that this does. It seems like some coffee shops in Crested Butte might find a way to add coworking to their purpose by providing a few extra services. One of the trends I've seen in the town is multi-use of space, and a coffee shop seems like it could be a candidate for some kind of coworking.

Mindfulness and Holacracy

I just spent 7 days at Esalen doing a mindfulness meditation retreat. That was not my intent, but that's what it became, and during the last three days I took a workshop that ended up being about mindfulness meditation, which lead me to yet another insight about Holacracy.

In mantra meditation, you repeat a word or phrase, aloud or mentally, as a way to draw yourself into a meditative state. As a freshman in college I took Transcendental Meditation and practiced it quite regularly for several years. To me, that was what meditation meant.

Mindfulness meditation emphasizes attention to your immediate experience in the current moment. As such, it doesn't limit itself to sitting meditation -- you can be walking, eating, or doing just about anything as long as you are present with that experience, focused on it and not thinking about something in the past or the future.

In our first exercise we were directed to pay attention to ourselves, and what we were feeling in our bodies. In particular, we listened to all the sensations we were feeling. In that I found my revelation. At that moment I was sitting on a pillow on the floor, with my legs crossed in some approximation of what you always see. As I have never been particularly flexible my body was saying a lot of things to me. I realized that I had always believed that these sensations were to be ignored. The teacher pointed out that it takes significant energy to push sensations away. If your body talks back to you about that, you must then push the additional sensation away. Pretty soon everything is a cacophony of struggle. But "sucking it up, pushing through, no-pain-no-gain" is what I had been taught and I never questioned it to the point that it became unconsciously internalized.

The first thing that happened when I started paying attention to the sensations is that I decided things were way too noisy, so I found a more comfortable setup and had much better results for the rest of the class. If I had continued to just fight it, that's what my experience would have been -- struggling (of course, you can't always just change your physical situation and quiet things down. Sometimes you just have to pay attention to those things). Now I'm looking for other places where I've learned to unconsciously do battle with myself, and start paying attention to those places (Noticing something only starts the process. It would be wonderful if all we had to do is see something to make it release completely, but we don't seem to be wired that way; we have to unwind it a little bit at a time, with patience and persistence).

How does this relate to Holacracy? The fundamental "unit of motivation" in Holacracy is the tension, which is exactly what it sounds like. In conventional companies, tensions are just all those little annoying things we put up with, as in "that's just the way it is around here." Tensions are the little pains that we put effort into ignoring. In companies with lots of tensions, you put lots of your energy into just dealing with those and very little energy into being productive (Perhaps one could even create a model of the lifetime of a corporation based on the accumulation of tensions; when tensions pass a certain line, the productivity + innovation equation drops below sustainability. The reason corporate lifetimes are dropping so fast could then be conjectured: innovation has become much more important).

In Holacracy, we do the opposite. Tensions are central to the process, so we don't push them away, we pay attention to them and do experiments to see how to change them. As a result, instead of constantly accumulating things to drain our energies (that is, the tension + the effort to ignore that tension), we're constantly clearing tensions away so that our energies can be devoted to productivity and innovation.

Wednesday, January 29, 2014

The San Luis Obispo Incubator

I met Matt when we were physics majors together at UC Irvine. He's been teaching at Cal Poly San Luis Obispo for at least a decade, and has also been the department chair. I always try to see him when I pass through, and when the business project came up in conversation he said he thought there was an incubator in town, so on a whim, we visited.

It was Saturday afternoon and the door was locked, but quickly answered by one startup's member, who gladly explained what was going on and gave us a tour. There were about a dozen startups in the space. The one thing that they all had in common was that they were former Cal Poly students.

The first step in the process is a summer accelerator, from which candidate companies are chosen for the incubator. So filtering happened to get into the accelerator, and again at the end of the accelerator before the incubator phase. Once the incubator began, the former students have two years of time where they pay 50$/month to stay in the space and use its amenities while they get started. There didn't seem to be any other kind of funding.

The incubator provides various kinds of coaching for the companies. Company members said that the camaraderie and idea cross-fertilization was very helpful as well.

There were several software companies, one that focused on materials, one on food and a number of others who weren't there that afternoon. I was generally pretty impressed by such an operation in a town of 45,000 (obviously the University is a major driver, but still), and if it had existed -- and I was of a mind to discover it -- when I was a graduate student there, who knows what might have happened?

Cal Poly also has the Research Partnership business park on campus, hosting companies that are likely to hire students and professors.

One thing I've found puzzling is the choices around financial support for startups. There's the approach that appears to have been pioneered by Y-Combinator: invest some money and take a percentage of the company. But the San Diego incubator and some others like the one above don't provide additional monies, just space and amenities. In San Diego, they charge no rent but apparently the reason they provide no seed money is because they feel it might influence the company in some negative fashion. And in San Luis Obispo they charge 50$ a month because, somehow, that rent was thought to be an important factor -- "we'll give everything else for free, but they've got to pay a little rent because otherwise they'll think (fill in the blank. Seriously, I don't know what to put there)."

Because of the apparent randomness of these choices (there doesn't seem to be any experimentation around them -- they look like guessing to me), I can only imagine that some influencer, during the formation of an incubator, stepped forward and said "surely, they have to pay some rent, because ..." or "we can't provide seed money because ..." or "we must/shouldn't own part of the company," etc. It doesn't seem like there's any science behind these decisions, just opinions, but I wonder if anyone has actually looked at the effects. For example, if the incubator provides no monies and the companies get seed money elsewhere, is there an effect on the companies that don't get much when there are others in the group that do? I would think so, and wonder if there are other things that would actually have positive and negative effects. And how can we tune towards the positive effects?