Capital-intensive Economy vs. Labour-intensive Economy

I was writing yesterday about startups and the startup ecosystem in Iasi and Romania in general, about the importance of the historical past as a way to understand the present, about Renaissance, Florence, the de Medici family and the importance of capital as a fuel of progress and great art.

This post can be considered as an addendum to my previous one.

I also mentioned yesterday about the feudal system and the feudal hierarchy: peasant, boyar, Voievode, foreign empire (the Voidevode usually being a vassal to some foreign power) with the peasants at the bottom of the chain and being dependent on their landlords. Well, it seems that, as weird as it might sound, one of the catalysts of progress was the Black Death.  Yes, the bubonic plague that caused swollen lymph nodes that turned black, hence the name – Black Death.

An important shift that was caused by the plague was the reverse from rent to wages: since the landlord was the owner of the land, the peasants had to pay a rent in the form of products, work or other kind of duties. The landlord also had some special rights over his subjects such as the le Droit du seigneur or jus primae noctis which allowed the lord to sleep with a woman on her wedding night – there is a scene in the movie Braveheart that depicts how such a right might have been exercised.

william wallace braveheart
william wallace braveheart

“Ironically, the plague may have been one of the sparks that lit the Renaissance, because the shortage of labour shifted income from rents to wages as landlords struggled to find both tenants and employees. With rising wages, some of the surviving peasantry could once more just afford the oriental luxuries and fine cloth that Lombard and Hanseatic merchants supplied. There was a rash of financial innovation: bills of credit to solve the problem of how to pay for goods without transporting silver through bandit country, double-entry book-keeping, insurance. Italian bankers began to appear all across the continent, financing kings and their wars, sometimes at a profit, sometimes at a disastrous loss. The wealth that the Italian trading towns had generated soon found its way into scholarship, art or science, or in the case of Leonardo da Vinci, all three. Per capita income in England was probably higher in 1450 than it would be again before 1820.” The Rational Optimist – Matt Ridley

I don’t know of any kind of similar shift happening in Romania or Eastern Europe happening at the same time, what I know is that serfdom was abolished in Russia in 1861 by Tsar Alexander II and in Romania was abolished in 1746 (in Wallachia) and 1749 (in Moldova) by Constantine Mavrocordatos:

In the aftermath of the Austro-Russian–Turkish War (1735–39), the harsh conditions of the serfs led to depopulation of entire villages or even regions, as serfs fled towards other places, often in the mountains or even in Transylvania. The landlords saw that without a workforce, they could lose everything, so some released their serfs, allowing them to work their land as before, but as free peasants in exchange of a rent. Peasants who had fled were enticed to return by being given special contracts, as were Transylvanians, who were encouraged to settle.

So, what happened here is that after serfdom was abolished, the serfs earned the “right” to pay a rent. No wages yet. We might say that the economic system was characterized by being labour-intensive not capital-intensive, the difference being that capital-intensive economy leads to increased productivity:

“Unlike Mesopotamia, Egypt, India, Mexico, Peru, China and Rome, early modern Europe became capital-intensive, not labour-intensive. That capital was used to get work out of animals, rivers and breezes, rather than people. Europe was, in Joel Mokyr’s words, ‘the first society to build an economy on non-human power rather than on the backs of slaves and coolies’.” The Rational Optimist – Matt Ridley

Let’s see what happened in Japan after it became labour-intensive due to a population boom:

“Where Europeans used animal, water and wind power, the Japanese did the work themselves. What seems to have happened is that some time between 1700 and 1800, the Japanese collectively gave up the plough in favour of the hoe because people were cheaper to hire than draught animals. This was a time of rapid population expansion, made possible by the high productivity of paddy rice, naturally fertilised by nitrogen-fixing cyanobacteria in the water and therefore needing little manure (though human night soil was assiduously collected, carefully stored and diligently applied to the land). With abundant food and a fastidious approach to hygiene, the Japanese population boomed to the point where land was scarce, labour was cheap and it was literally more economic to use human labour to hoe the land than to set aside precious acres for pasture to support oxen or horses to draw a plough.” The Rational Optimist – Matt Ridley

Capital-intesive economy 1 – Labour based serfdom 0

The Daily Concept app one month later

It’s been more than a month now since I launched one of my recent projects that I’ve been working on: The Daily Concept app. The idea behind it is simple as well as the app itself:  it shows a different concept from various domains like Biology, Math, Psychology, Sociology, Religion, Physics, Economics and so on so the idea is to learn something new and interesting day by day.

Sounds like a great idea for an app isn’t it? Everyone wants to learn, to grow and to become the best possible versions of themselves! Well, that’s what I thought. I got very excited with this idea when I came up with it, inspired by the Word of the Day from Merriam-Webster, and mistakenly thought that there are a lot of people out there that are thinking like me. I’ve done some research and realized that there is nothing similar on the Internet.

I’m an INTP according to the Myers-Briggs personality test. The INTP personality type is fairly rare, making up about 3 percent of the population, and is characterized by creativity, curiosity,  the strive to discover and learn more about the world around them. The INTP type is also characterized by rational and logical thinking rather than emotional thinking.  It seems that the INTP and INTJ types are the most inclined to want to learn something new each day but I failed in finding and coaxing them so far. The truth is that there are a lot more people, the majority of the population that are not thinking types and would rather spend their time and attention on something fun and entertaining, there is no surprise here, Kim Kardashian or some other celebrity of the day will always have much more followers than the concept of the day.

So, the promotion that I did for the past 30+ days was to post on 14 social media sites a screenshot from my phone with the concept of the day, along with the title, short description, download link for the app and tags. The screenshot doesn’t shows the whole description of the concept, only the first few lines, I thought that this would translate into more downloads.

quinarian system

I tried to automate this process as much as I could so it doesn’t take me much time to do the posting. I’m getting followers, some interactions in the form of likes and retweets/reblogs but that’s about it.

Judging by the first month’s metrics, it seems that this app will turn to be yet another failed idea. I’m not giving up on the app, I will do some minor tweaks to the app and continue to promote it on social media for at least one more month. Because of the high probability of failure is not worth investing too much time and energy into this project.

For the few active users of the app: you don’t have to worry about this, the app will continue to automatically show something new each day until the end of the year!  There are a lot of new concepts to be learned so keep an open mind and enjoy!

Days 2&3 – Building my new personal branding oriented start-up

What am I doing? Short recap: I am doing 3 days long sprints, 2 days allotted for picking up an idea and building a product/service around it and 1 day to promote the minimum viable product that results from the first 2 days. In the first day I settled on an idea based on online personal branding and to offer a service consisting on creating profiles on more than 50 social media sites.

What a beginning today: went to Namecheap in order to buy a new domain but their service was lagging and throwing 502 errors towards my way. As for the name of my new domain, playground for my experiments, I settled on 72startups, it’s pretty clear why 72, 72 hours duh. I did an internet search and got to From that page it seems that today 24 October there is an “NAMECHEAP.COM EMERGENCY MAINTENANCE”:
“Dear Customers,

Our site is currently undergoing an emergency maintenance to upgrade our systems in order to better serve you.
You may receive Cloudflare or 500 errors on the site.
We apologize for any inconvenience during this short outage and thank you in advance for your patience and understanding.
Our development team is working on addressing this issue.
Once we have any news we will update this status post.

Kind regards,
Namecheap Support Team”

Not a good start. The problem is finally solved and I start working towards the goals of the day with a detour first: I have to buy new domains and hosting ($30), to install WP and setup my main domain and to do my first blog post. This took me more than I thought and should be a lesson for me to learn to plan things better next time so I can fully concentrate on the days’ goals. The next step was for me to sign up and add my info on a bunch of social media in order to have a good estimate on how much time this process would take and thus to have a good estimate for the price that I will charge for the service, this step should also help me build the value proposition that I’m offering to my customers. I got a bit carried away in completing this step, I ended signing up on 60 social media sites and the process took me longer than I expected, part of the reason being that I didn’t had any previous experience with most of the sites so I had to go through a learning curbe and to learn each site’s intricacies and quirks. The fact that most of these sites are optimized to keep you hooked also contributed to my distraction, in some cases I had the tendency to check out more of what they had to offer rather than just creating my profile and running away. Once this step was completed I started towards the next one: setting up the site and the landing page. As a software developer I have the tendency to start from 0 and to throw a bunch of code at a problem but I decided that in this case it would be wiser to just go with existing solutions, there is not point in reinventing the wheel, what is needed is a only a landing page, nothing too fancy. So I just installed WP and searched for a nice theme and found it: Illdy.


Day 3
Time to customize the WordPress theme and whip it into a decent landing page. This too proved to have a learning curve with a higher time cost than I thought. The problem is that once you settle on a ready made solution you also have to face its issues as well, in this case the theme being no stranger to bugs. No matter what I would do, the theme would show the footer section and I considered it to be redundant, I didn’t need links again to the homepage, FAQ or to the blog, they are already shown in the top of the page. I get my hands dirty and edit the script files that were causing the problem. I get into the software developer thinking mode again when trying to install the Paypal button, the theme is not properly showing it, it shows it either too small or too big, so I try getting my hands dirty again by editing the script files responsible with showing the section in cause. The editing turns out to be problematic, I’m not getting the results that I want but fortunately I snap out of the developer thinking mode and realize that there must be some plugin out there that should do what I want to do. I find the plugin with ease and solve my problem. This concludes Day 3. The plan was to have some time left, at least one day in order to do some marketing but things turned out more time costly than I thought. It’s not all that bad, at the end of 3 days I have a new domain and a personal blog, managed to do some personal branding on 60 social media sites, and I also have transformed an idea into a domain with a landing page ready to take orders.

Lessons learned:
1. Better organization before an operation begins, I should have information and the tools I need to complete a task more readily available.
2. Planning fallacy: “is a phenomenon in which predictions about how much time will be needed to complete a future task display an optimism bias and underestimate the time needed.” I’m now aiming for a 3 day build sprint during which I will build a Minimum Viabil Product (MVP) followed by a 3 day promotion sprint. 2 days of building and 1 day of promotion seems unrealistic and limitative.
3. The KISS principle: Keep it simple, stupid! I tend to overthink and not see that are already-made solutions to my problem or to see the simpler solution, there is no point in reinventing the wheel each time.

Day 1 – Online Reputation, Personal Branding

I finally decided to take action so today is day one of my startup blitzkrieg.

I didn’t have any clue with which idea to start this morning so I just quickly went over my list of ideas (about 90+ ideas strong) and decided to go with something related to online reputation and personal branding. It should be noted that I already had an attempt at it a few years ago, the project was called . Once I settled on the idea I realized that I have no clue about what to do next and more importantly, what to build, so I started researching and documenting by reading articles and one particular long guide on personal branding. This took me about 3 hours. While reading, ideas started to pop up, I took notes, bookmarked some links, learned about some new tools and also added 5 more ideas for 5 potential startups to my ideas file. After reading I had 5 ideas about what the product/solution might be and after some thinking and elimination only two potential ones remained: an alert system for Q&A sites, forums, blogs, video sites and so on and an online availability checker and securer of usernames on social media. One of the rules of the game is to automate as much as possible so the second idea didn’t seemed viable enough, it would take me more than 3 days to automate the process of registering and editing of profiles for a bunch of sites, so the next best solution would be to do them manually.

So an alert tool it is then. Got on Quora, checked the source code, noticed some patterns and then fired up a Python script with Beautiful Soup. The script didn’t worked, it couldn’t read the DOM responsible for the question links and apparently Quora likes to do some obfuscation so then I tried with Mechanize and Beautiful Soup altogether. Mechanize emulates a browser. This too didn’t worked, got an 403 error message, something about the robots.txt file. Checked on the internet, got over the error but it still wouldn’t work. After some quick internet search I get to a question posted on Quora about how to scrape Quora. Well, it seems that Quora doesn’t like to be scraped and this is against the ToS. Quora was an important piece in my value proposition, the idea was to notice the customer when a relevant question comes in so he can hop in and answer it and prove his mastery and expertise. There is also the fact that offers this type of service for free. There is also Google Alerts. I don’t like to compete with free, it’s hard to compete with free. And there is also the fact that this kind of solution is not necessarily only for personal branding, it can be used in other ways too so this kind of chips away at the whole market segment intended for personal branding. Alright, I will ditch this idea.

Even though it would require some intense manual work at first, the idea of creating profiles by hand seems better now, I can at least compete against some expensive services out there and I also feel like I can provide some real value, this solution can save a lot of time for the customers. I’m thinking that I can “automate” the process by outsourcing the creation process to a cousin who doesn’t have a job right now, to Mechanical Turk or even Fiverr. If my service gets really popular by some weird twist of fate than I can take steps to automate the whole process. This solution also spares me of the need to create a custom website, I can simply slap a WP blog and then a membership plugin to it and save a lot of time. I always have to remind myself to keep things as simple as possible and to not try to reinvent the wheel.

I wish I could have done more but I felt a bit tired at the end of the day – those 3 hours of reading and brainstorming where quite intense, tried to focus 100% – and decided to pursue other activities. I’m at the beginning of my journey and I don’t want to get burned out, yesterday, while reading from Deep Work by Cal Newport, I found out about the Attention Restoration theory. Apparently we have a limited time, about 4 hours top in the case of “experts” and only one hour in the case of “newbies”, in which we can do intense cognitive work aka deep work; we are not machines so we need to restore our attention from time to time by taking a break and watching nature because this is what the theory recommends: “people can concentrate better after spending time in nature, or even looking at scenes of nature.”

The plan for tomorrow would be to create the website, do the copywriting, landing page, calls to action and all of that stuff and to manually create profiles for myself on a bunch of websites to see how much time it takes (and in order to estimate a proper price for the service).