I first heard about the concept of a “Zebra company” four or so years ago when I read an article about this strange, early-stage investment fund group called Indie.VC. I learned about them, and what do you know, they were holding an info session a week later in Detroit, MI, so, naturally, I went.
The purpose here is not to talk about Indie.VC specifically, but instead to address the various models of running and operating businesses. We live in a moment in history when the entreprenuer is, functionally, the new American dream. It goes a little something like this:
Step One: Start a legal company, incorporated in Deleware, and don’t even think about anywhere else.
Step Two: Ensure your market cap can exceed no less than a billion dollars, be defensible, and can be legally protected with IP, patents, and trade secrets - ideally you have all three.
Step Three: Blitzcale or Move Fast and Break Things. Doesn’t matter what you do, just grow really fast in the hopes of global dominance even if your company doesn’t make money. Scale and don’t look back. Don’t sleep, work non-stop, raise more money to cover your burn, and fetishize “hustle”.
Step Four: IPO, SPAC, or Acquisition by a Fund
Step Five: Mai Tai’s on the beach.
It may not surprise you to learn this path wasn’t and isn’t exactly appealing to me. It’s rife with toxic work cultures, it often, if not always, puts profits over purposes, and it hasn’t done a lick to make living on this floating rock much better for most people.
Dan, you mentioned a Zebra, what’s a Zebra? Ah yes, a Zebra! If you adhere to the above as the path you’re on, whether you know it or not, you’re working on growing a Unicorn. A Zebra is not the opposite of a Unicorn, but it certainly offers another way to think about growing a company.
A Zebra is a company that takes a slightly, more blended approach, and, quoting from this amazing article:
To state the obvious: unlike unicorns, zebras are real.
Zebra companies are both black and white: they are profitable and improve society. They won’t sacrifice one for the other.
Zebras are also mutualistic: by banding together in groups, they protect and preserve one another. Their individual input results in stronger collective output.
Zebra companies are built with peerless stamina and capital efficiency, as long as conditions allow them to survive.
I have been thinking a lot about Zebras lately. Why hasn’t this model gained traction? Indie.VC is now defunct, and that article was written in 2017, so it’s not exactly a new idea. Is our focus on boundless profitability at all costs blinding us to the very real limits of our planet, our labor, and our attention spans?
Folks aspiring to start businesses or organizations need to be made aware of the varying shapes and textures that their work can exist in. Non-Profits to B-Corps, Zebras, to Worker-Cooperatives, and ESOPS. We do ourselves, our community, and the next generation of would-be-founders a great disservice by not exposing them to this varying and complex tapestry of options.