Why I Study Companies Operating at the Edge of Legality

The best ideas generally look terrible at conception due to the obstacles they must overcome to achieve success. To build innovative and revolutionary products or services you need to be pursuing things that are counter-intuitive, appear destined to fail or aren’t legally permitted.

When I say ‘aren’t legally permitted’ I don’t mean things which are illegal. I refer to things which there is no laws against but know you are operating against the spirit of what the existing legislation permits.

Find what is currently legally permitted and explore the consequences of taking that a stage further

The biggest innovation’s that have occurred in recent years have been because of this. You see the rise of Uber and recognise that it was operating on the periphery or legality in every jurisdiction. The taxi industry is a heavily regulated and scrutinised industry for obvious reasons — public safety — but Uber thought they could provide a better service at a lower cost to the end user.

So they just did it

It’s far better to ask for forgiveness having done something wrong than to ask permission and wait for it to come not knowing whether it ever will

The blow-back you are seeing now in relation to companies operating in the ‘Gig-economy’ is simply a manifestation of legislators trying to catch up. These companies innovate quicker than the government can keep up.

They started something without considering any possible objection to what they were doing. When objections inevitably arose they were able to negotiate from the point of having started something which was successful and the public loved.

Had they asked for permission, Airbnb and Uber wouldn’t exist because they wouldn’t be allowed to operate the way they do now. Their business models and success are as a direct consequence of shaping the regulation that will arise to govern their innovation. They set a baseline and forced the government to conform to their new paradigm instead of the other way round.

The Future

In the same way Napster was a precursor to Spotify or LimeWire was to Netflix, what will the Spotify of online consumption look like? Innovation at the periphery of legality is where disruption occurs. At the intersection between the two is where innovation resides.

My contrarian belief is that advertisement will die as a form of revenue generation in the next 10 years

Companies will be forced to evolve or die. In the same way analogue music sales were massacred by a new paradigm thing’s that we have come to expect as the status quo of web 2.0 will be eradicated by web 3.0.

How will these tech giants evolve to dominate web 3.0?
I look towards innovators who are already finding ways to generate revenue out with the traditional model Google adverts displayed on each webpage. They are offering illegal services on their websites and therefore cannot employ traditional methods of earning money.

Companies will emerge that enable the consumption of content without the necessity for users to pay creators or service providers directly. For low CPU usage tasks — watching video, reading articles, social networks, photo sharing, almost every task you undertake online — services will tax you a % of your CPU usage and use that to mine Crypto which will be distributed to the creator according to how long you spent watching, reading or using what they made. That is where the next great company will emerge from, enriching creators in a way that rewards their contributions.

Cryptocurrency and the Blockchain

Cryptocurrency has been viewed suspiciously by governments since conception. Is it an international foreign actor trying to destabilise fiat currency and traditional economic markets? Is it a weaponised fiscal tool which has the potential to overturn governments? Though not strictly illegal, cryptocurrency has always operated in the shadows of legality and had you worked to the assumption that those things which are happening at the periphery are likely to be the things which are adopted by the mainstream, you could have been one of those people who has profited over 50,000% from an initial investment.

On the other hand, had the government forced you to consider an alternative to traditional financial institutions, you may have been forced to adopt it with no viable alternative available for you to consider.

When constraints are placed upon people they are forced to adapt of die, this is a compelling incentive to reinvent the world we live in

That’s why I focus on people operating at the edge

They are unpredictable and focused on survival. They are forced to consider opportunities and possibilities that wouldn’t occur to other people as a prerequisite of living to fight another day. Where most companies march a prescribed path and conform to social convention those operating at the periphery are reckless in their ability to pursue fresh ideas.

They can innovate beyond what is even conceived as a possibility.




CEO / Founder / Coach @FirstbaseHQ Empowering people to work in their lives not live at work ✌️✌

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Chris Herd

Chris Herd

CEO / Founder / Coach @FirstbaseHQ Empowering people to work in their lives not live at work ✌️✌

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