If Logos were to go out of business...
Comments
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Scott E. Mahle said:
Hostess
Actually, some good news. Hostess has tons of interest from potential buyers and will likely be back in some form:
http://www.cbsnews.com/8301-34227_162-57556264/hostess-says-it-has-over-100-interested-buyers/
I think this is just one example that demonstrates what Bob and Mitchell were saying. Once an entity reaches a certain level of critical mass with customers, there are valuable assets which continue to exist even if the company fails. Those assets are usually bought by a competitor or another other interested party that can monetize them. Worst case (or possibly best case?), a dedicated user group keeps things going.
When I began switching from physical books to Logos, this was the bet I made (just like the bet I made with my growing library of Amazon Kindle books). It seemed that, in the not-terribly-likely event that Logos went under, the platform would be attractive for a buyer because:
1) There is a large, dedicated group of users, many of which have made substantial investments in the products (thousands or tens of thousands of dollars each). These user have also made a substantial investment of time into learning the software and understanding how the company does business. When they are unhappy about something Logos does or doesn't do, customers are much more likely to make loud complaints (sometimes very loud!) than to just abandon their Logos library and switch to a competitor.
2) The investment which Logos has made in building a library of thousands of linked resources is valuable in itself and, to the best of my knowledge, would not be easy for a competitor to cheaply replicate. This network effect is an incentive for customers to own all their resources in Logos rather than purchasing some resources with Logos and others with competitors.
However, while I am pretty comfortable with my Logos investment at the moment, if I was had to list my potential concerns for the future, they would be as follows:
1) Successful technology companies have a nasty tendency of becoming "lame" following many years of success and growth. There are a number of reasons why this happens, but I think one of the main causes is that CEOs often fail to protect the strong corporate cultures responsible for their initial successes. Hiring gets sloppy and new sub-par employees are then brought on board. These sub-par employees drive away or distract good employees, create lower quality products, treat customers poorly, make bad business decisions, and generally ruin things for everyone. And make no mistake - when you're growing fast, it's very, very, very easy to go this route if the CEO is not extremely conscious of how easily all this can happen. Fortunately, this tendency can be significantly less likely for well-run privately-held companies like Logos in contrast to venture capital backed startups or public companies. Additionally, my impression is that Bob is pretty focused on hiring and maintaining the culture at Logos. However, Bob won't live forever (at least not in this life), so let's hope and pray that he effectively selects and grooms the next generation of Logos management and employees, and that whomever ownership of the company passes to shares his values.
2) With any technology, there is always the risk that another unforeseen competitive technology appears and massively disrupts things. So far, I think Logos has been pretty smart about seeing where things were headed (e.g. mobile, cloud-based). However, I always worry that they'll miss a big one and end up with a product that is significantly inferior to what is offered by competitors. I don't know just what these next technologies will be, but if history is any guide, they are definitely coming.
3) There is always the risk that someone makes a much cheaper way for publishers and content creators to bypass a platform like Logos and deliver their product more directly to their customers. Now for a very specialized type of product based on Bible content, I think this would be less likely. However, what if the major publishers one day agree to an industry standard for Bible content and form a jointly owned entity that delivers it all electronically, hence bypassing Logos? I don't see this as very likely, as I suspect it would be difficult for all those publishers to successfully cooperate on such a venture. Furthermore, Logos does seem to provide them a lot of value right now, as well as deliver other features which they might not be interested in building. However, if the publishers see their profits under enough pressure and/or there were to be significant consolidation amongst the major players, something like this could always be a possibility.
So I'll repeat that I'm pretty comfortable with my investment in Logos right now and appreciate all they do to keep the value of my investment intact. Relative to all the companies I deal with, I think the quality of their products and service is right up near (or at) the top. Sure, something unforeseen could always happen at Logos and I could end up losing what I invested into building my library. But overall, I think betting on Logos is a pretty solid bet to make.
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Sogol said:
So I'll repeat that I'm pretty comfortable with my investment in Logos right now and appreciate all they do to keep the value of my investment intact. Relative to all the companies I deal with, I think the quality of their products and service is right up near (or at) the top. Sure, something unforeseen could always happen at Logos and I could end up losing what I invested into building my library. But overall, I think betting on Logos is a pretty solid bet to make.
Blessings in Christ.
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Sogol, I really appreciate your thoughtful and thorough response. I totally agree with you.
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