Parasitical Business Models
I’m not sure when the thought occurred to me, but I have a rather powerful metaphor which helps you decide whether a business model is good or dangerous. To explain it, I need the help of a rather unpleasant amoebic organism known as Naegleria fowleri (or N. flowleri for short).
N. fowleri is an amoebic organism. If you’ve forgotten your biology, an amoebic organism is a single celled organism with the power of basic motion using the extension of cellular ‘fingers’ (pseudopods). N. fowleri lives in warm tepid waters where it meets our olfactory system (our noses) when we go swimming through infected water.
We live in a world filled with micro-organisms, so this sort of thing would normally make little difference to us. However, in the case of N. fowleri, typically within the first five days dangerous symptoms appear; fever, stiff neck and confusion.
This little invader (8 - 15 micrometers) causes these symptoms by invading the brain and consuming its matter, causing swelling and inflammation of the remaining tissue. Within two weeks, an infection with N. fowleri is fatal in 95% of cases. Put simply, to live, N. fowleri needs to kill us. It is, in the clearest sense of the word, a parasite. Due to changes in climate that affect water temperatures, it is a growing issue.
I’d like to compare this to a different micro-organism, known as a ‘mitochondrion’. They are a large, kidney-bean shaped component of a cell responsible for generating the cell’s supply of chemical energy. The crucial insight is that mitochondrion are thought to have actually once been a seperate cellular organism. Evolutionary theories suggest that an early ancestor of the modern mitochondria were ‘brought inside’ cells and entered a symbiotic relationship with the host cell.
Using this metaphor, does your business model align itself with the behaviour of N. fowleri or a mitochrodrian? Business models are meant to be the engines of a product or service. They define how value is exchanged between the organisation and the people it serves.
When business models work well, an organisation thrives and it enriches everyone and everything around it. When they don’t, it poisons its customers and society at large. If your business has a symbiotic relationship with its customers, which is a way of saying that both benefit, it is a mitochondrion.
In contrast, if it is a N. fowleri business model, it can take days, weeks or even years, but eventually the parasitical model will drain the life of its host. In our case the customer. When parasites are too aggressive, they even risk doing harming to their own way of life, as they run out of a ready supply of hosts upon which to subsist.
I think a number of businesses deceive themselves into thinking they are mitochondria because their effects do not occur immediately. Perhaps N. fowleri is a less accurate example versus something like a tapeworm, which can spend years weakening its host. For a relationship to be a true symbiosis, shareholder or management needs cannot exceed that of customers. They must be in balance.
We’ve talked before about how organisations have to deal with a complex webs of stakeholders. The reality of developing a business model that doesn’t drain the life of someone in the chain is difficult given the number of potentially competing interests. It is isn’t easy but it means that you can make something you can be proud of.
You don’t really want to be a parasite.
N. floweri photo by USCDC [Public Domain]