Entry Cost

I never started doing “from scratch” video until I found wochit. I never started making podcasts until I found Audacity. I never started writing blogs until I found WordPress. These are not the most ambitious systems in which to create content, but they are the systems with the lowest entry cost.

Someone was talking about a gaming engine called Unity the other day, and I overheard them talking about how it was no good. There were thousands upon thousands of bad games made on the engine. But the engine, contrary to his opinion, has great games.

Games like Hearthstone, which rakes in millions of dollars a year, and Cuphead, which achieved international acclaim as a game to revive side-scrollers were both made using it, and these aren’t rarities either. The engine does have really, really, bad games, this is true, but this is because the engine has the lowest entry cost of any game not because the engine is flawed.

Many people will look at a simple template for art, creation, or testing, as lower because of how many people enter the template. People mistake videos and podcasts made with simplistic tools as being bad or awful, but this isn’t because the tools themselves are awful, this is because the tools have a very, very low entry cost.

There are a lot better video production tools out there than wochit, but Wochit is by far the easiest, and it can attract anyone from anywhere to start creating on a medium. Wochit opens the doors for people to begin learning about a field. It might be the “square one” but there would be a lot fewer people knowing anything about video production or editing without the hyper-simplistic tools.

Think about a baby with a toy tool or toy household object. A child a toy hammer, or a toddler and a plastic teacup. They might use the toy in all manner of means, from throwing to swinging to gnawing before they figure it out, but once they begin to see the very basic and simplistic use of the mock-tool, they can start to see the use of the real one.

The same goes for low-skill entry jobs. I know a contractor in real estate who started as a Mexican immigrant to the United States, unable to speak English and working in construction. He had nothing but his own ability to create, his ability to swing a hammer, lay plywood, or create a house foundation.

Today, however, he owns his own company as a developer. He has gone from the most minute position in the industry of construction to a very significant and important one. None of this would have been possible without the low entry cost into the industry, the cost which simply asked his time and his labor taught him the basics, and from their, he could move on to more significant and complex projects, as well as the handling of teams. The low entry cost associated with his labor, became the high potential roof for him to serve the rest of society with his company.

Entry costs keep people from being doctors, yet let otherwise restrained minorities enter a field they wouldn’t have. Today residential real estate, which at one point was as male-dominated as any industry, is now primarily female. Women have come into the industry and flourished. Both my mother and my grandmother have tried their hands, and both created their own firms. This too is because of low entry costs.

During past eras where women primarily ran the family, and man primarily ran the household, women who became divorced or alienated from their husbands often times struggled to find work. Given the eras, many women did not have college degrees, and a culture of equity was as far away as the horizon… but real estate was close.

Real estate had an exceptionally low entry cost, and the job wasn’t dependant on a degree, as were most forms of sales. If you sold the house, you got the commission. If you didn’t you didn’t get paid. The entry cost was showing up, every day and keeping to the job. Women who previously had fewer opportunities took note of all this, and they saw a way forward through the real estate market, and they went for it. The low entry cost and the massive reward ceiling was the perfect recipe to invite people new to the workforce into an industry they could thrive in. As a result, women began to step into the industry, becoming more and more involved in the market and making more and more a name for themselves.

Low entry costs invite the unskilled and uninitiated into a world of much, much more options. It lets a market have plenty of participants which keeps the market in motion and keep new talent arising all the time. It lets people play with the most basic version of the tools first so that they can fathom the most complex later.

Low entry costs mean a lot of entries, and a lot of entries means a lot of potential for great products, services, and ideas.

Until next time,

Cade

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