Build For The Masses to Eat With The Classes

When starting a new project there is one saying that I always have in the back of my mind “Build for the masses to eat with the classes”. This saying was passed on to me by my grandfather. His company developed a lot of the Philadelphia waterfront and took on a few big projects in England. My grandfather has since retired and moved out to Colorado, but doesn’t hesitate to give me great business advice when I need it.

During a phone call yesterday, I told him I was thinking about writing a blog article about his saying. He was quick to point out that although he would like to take credit for it – the saying was actually passed along to him when he was first starting out by a very prominent builder at the time named Mayer Blum.

Like many self made entrepreneurs, my grandfather struggled when first starting out. One of his first projects was rehabbing historic homes in a very wealthy area of Philadelphia. Selling high priced items to the wealthy, should make you a lot of money, right? Unfortunately this isn’t always the case, my grandfather found himself putting a lot of effort in but making a very small profit. However his entire mindset and business strategy changed after Mayer Blum took him out to lunch one day and gave him some advice that he would never forget.

About once a month Mayer would call me and ask me to join him for lunch. I never refused since he picked me up in his limo and took me to his private club. This club was so exclusive that I couldn’t have got past the doorman for any reason, by myself. Mayer was nearing 80 at the time and I soon realized that he missed the action of business and simply was remembering his early days through conversations with me.

He gave advice and introduced me to members of his club who were prominent bankers, lawyers, politicians and other major players in the business life of the city.

One day he was complimenting me on a particular house that I was working on, but was making very little money on the project. I expressed my concern and he gave me an answer that shaped my business approach for many years.

He said “Buck your work is good and you are doing an important job for the section of the city where you are rebuilding those old houses. When it comes to the money your father should have explained: When you build for the classes you’ll eat with the masses. If you build for the masses you might be eating with the classes.

- from Bucksays.com (my grandfathers blog)

Traditional brick and mortar entrepreneurs and internet entrepreneurs can both learn from Mayer Blum’s advice. Many of the world’s largest companies found success through applying this very principle.

• Apple & IBM built a personal computer for the masses.
• Microsoft built an operating system for the masses.
• Google built an online advertising platform for the masses.
• YouTube brought online video sharing to the masses.
• Facebook built an easy to use social network for the masses.

These days, iPhone and Android apps are all the rage, and you can see this philosophy at work right in the Apple App Store. 90% of the top grossing apps are simple games that are either free, or $0.99. These companies are building products for the masses – everyone loves games and everyone has $0.99 to blow. What’s crazy is the games priced at $0.99 are grossing more than games priced at $15.

You can see this for yourself, just look at the number of ratings an app has. Right now only around 5% of people who download an app actually end up rating it. This means that if an app has just 6,000 ratings it has probably been downloaded over 120,000 times! As of this morning, my favorite app built for the masses – Angry Birds has 482,000 ratings. Try doing the math on that. It’s hard to comprehend the scale at which the Apple App Store operates however those who were able to master the art of thinking big early on have become the big fish in this enormous sea.