Companies disappear – or just change?

I joined Jupiter Communications in 1999. In June 2000, the company was acquired by/merged with Media Metrix to become Jupiter Media Metrix. Later the company would not be allowed to merge with Nielsen//NetRatings, have parts sold off etc. etc. We tend to think of companies as having lives of their own and persisting – in fact in some way or another, Jupiter Communications had existed since 1986. But companies merge, change, and it is rare for one to exist for the length of an average human life. These tend to be some of the largest companies around who have survived, gobbling up lots of other companies as they have grown and evolved.

I found it funny to do a search for Jupiter Media Metrix and be directed to a LinkedIn page about the company, that had a mix of correct historical information and some strange new information about another firm:

J-M Manufacturing Company, Inc. produces plastic pipes, fittings, and tubing products for water, electricity, gas, and communication. It offers polyvinyl chloride and polyethylene products; and PVC pipes, PEX pipes, PE pipes, and PF frames.

Ooops kind of a mess there. Anyway, for large companies there is a survivorship bias naturally. According to this BusinessWeek article from a few years ago, “The average life expectancy of a multinational corporation-Fortune 500 or its equivalent-is between 40 and 50 years.” Those are the most successful companies – other things I’ve seen say average company age expectation in Europe and Japan is 12.5 years, and that I’m sure excludes micro-businesses that disappear before getting onto the radar screen in a formal way.

The notion of what a company is, of what the fundamental aggregated currency should be of human output, creativity and production, is going to change over the coming years immensely. I could easily see loose collections of independent contractors with working relationships fashioned on-the-fly – already it is possible to build businesses like this; so perhaps it is useful to draw the distinction between a business and a company. You don’t need a company, to build a business (and apparently some people try to prove that you don’t need a real business to start a company and raise money!).

Y Combinator’s FAQ page makes for interesting reading too… new ways of funding and supporting businesses, but even this is not different enough to what exists today. For now, the inflexibility of corporate and tax law in most jurisdictions and other bureaucracy is probably what will prevent any innovative new structures from growing and thriving — they still have to fall within the limitations of the current system. But time will lead to changes as it inevitably does.