The Information Curve

Posted: 08.01.07

By now you should have seen and studied Kathleen Maher’s Practicality Gap thesis.

There is another chart that is interesting to examine, the Information Curve.

Information Curve

It’s a phenomenon that a company goes through as it succeeds and matures. The company starts out very secret, not wanting to let any information out about its precious ideas. Then it goes looking for funding and some information begins to leak out. When it gets its first product, of course, information has to be provided, but it's still restricted—as the company is paranoid about competition, real and imagined.

Eventually, if the product is successful the company begins to feel secure and tells more about itself. On the way to becoming successful and perhaps launching an IPO, it becomes boastful and tells a lot about its product’s roadmaps and other interesting information. It attracts investors, customers, and admirers.

Somewhere along the way, the company hires a PR firm. Not knowing anything about the product or the industry, the PR firm tries to turn off the technical information.

As the company continues to grow, it hires a larger PR firm, an organization that is now in control of the company’s public image and messaging. Since the company is well-known now, and can do no wrong, less technical information is needed, and only consumer benefits are offered with little or no substantiation. This is known as the “over-PR’ed stage.”

Now the company becomes really successful (in spite of the PR firm) and the lawyers come in to “protect” the company and the offices. Information flow ends. This is known as the “over-lawyer’ed stage.”

Now, the company has plateaued or is declining. The company has stopped communicating with its customers and its investors and says nothing with lots of caveats about how they can’t be held responsible for anything they say, might say, or even suggest. The company is no longer fun, exciting, or innovative; it serves its lawyers, PR firms, and investment bankers.

So where are you and your company on this curve? Are you afraid to tell anyone, least of all an analyst or the press, the truth about your specifications, design wins, or product plans? Are you afraid that if you revel too much the competition may find out, may figure out what you’re up to and beat you to it? Doesn’t say much for your self-confidence or the way you’ve been investing your investors' dollars in R&D, does it?

Doesn’t say much about your pride of accomplishment, or your vision, does it?

Says a lot about who’s running the ship. When you started the company, did you think you were doing it for a bunch of lawyers and PR people? What’s that, you’re not allowed to discuss such things? Oh, OK. We don’t care anyway.