Business Lessons from the Rainforest Wealth Lessons from Nature pot

Business Lessons from the Rainforest
Wealth Lessons from Nature
BY
DR Nzewi Dozie
SMASHWORDS EDITION

PUBLISHED BY DR Nzewi Dozie on Smashwords
Business Lessons from the Rainforest
Wealth Lessons from Nature
Copyright © 2012 by DR Nzewi Dozie.
All rights reserved. No part of this publication may be reproduced or transmitted in any form
or by any means, electronic, mechanical, photocopying, recording or otherwise without the
prior permission of DR Nzewi Chukwudozie, 48 New York Avenue NW, Washington, DC. 20001.
(571)-268-3465.
Acknowledgement.
This is to acknowledge the owners of the photographs used in the cover of this book.
1. For the photograph Daintree Rainforest originally uploaded by Adz at
en.wikipedia. Released under GNU Free Documentation License.
Introduction
The rainforest is the richest ecosystem on the planet, with half of its entire species,
and most of its fresh water. There are more species of fish in the Amazon than all the
entire Atlantic Ocean, more in one pond than all of the British Isle. One hectare (3.7
acres) may contain 750 species of trees and 1500 species of other higher plants. They



collect by far more energy from the sun than humans consume. My entree into the
rainforest was in Cameroon which has part of the Congo Forest. Indelible to my

memory was the increasing darkness with every step taken, a canopy overhead, the
sun not in sight. It was evening. Inevitable was my sense of the need for us to get out
before it became too dark.
High levels of rainfall are what make the rainforest so rich. The soils are actually
leached shallow and very being washed by the heavy rains for millennia. They lie in
the tropical convergence zone where winds from the northern and southern
hemispheres having picked-up moisture along their journey over half the planet meet
and dump the water.
The rainforest is a self-sustaining system of production and consumption. It is big and
has no cycles of recession. It’s is very diverse with all kinds of relationships among its
players: competition, cooperation, and collaboration. If you are a business you have
your equivalent in the bush and it has lessons for you. The scale of the rainforest is
massive so it is easy to observe and the inferences made with confidence. I have been
directly involved in three business ventures, starting-up and owning two of them.
The structure of the rainforest like that of the market is layered. There are four
layers: the emergents, the canopy, the understory and the forest floor. There are the
animals and the microbes which operate in all layers. They are the equivalent of
regulatory authorities. Regulatory authorities operate in all layers of the market.
The Emergents.
These are the tallest trees of about 50m in height, up to 80m. They are the smallest
group, and are exclusive. They are the Fortune 500 companies. They are above the
canopy and do not compete for sunlight, but have to stand the wind, brave lightning,
endure animals and avoid the chainsaw.
The Canopy.
This is the second highest layer, where the branches touch from tree to tree so close
that it’s a green ceiling denying sunlight to those beneath. It is the competition zone
characterized by a day to day battle to see the sun. It is a day to day battle to be
seen by customers and maintain the brand. In this market any lag in height could be
permanent, even fatal. The trees try to keep up with each other to get sufficient
sunlight. There is no worry about the weather; they share the risk, and together

“weather storms”. Collectively they constitute a storm breaker. However not all risks
can be shared, like the risk of being struck by lightning. An uninsurable risk.
The Understory.
These are a third layer of plants. They do not try to compete for sunlight; instead
they develop strategies to catch enough like broad leaves. The coco-yam has two or
three leaves each like a telescopic dish capturing as much of the remaining 20 per
cent of the sunlight that reaches this level as possible, well ahead of star-gazing
telescopes at space observatories. They are protected from the weather, but being
small these plants are vulnerable to animals, so some store their carbohydrates
underground in their roots(tubers), some don’t form seeds, they will grow from stems
and cuttings. This is the niche market. Some plants climb the giants to reach the sun,
twisting around him, sometimes very aggressively; sometimes sinking roots into his
stem, there are lessons here for the small business. Some plants are not that
aggressive but just grow on debris that gathers on the giant.
The Forest Floor
Littered with dead leaves and decaying branches this is the recycling business. It is
very efficient and work dispatched very quickly. Fallen branches go quick, devoured
by an army of microbes which include bacteria and fungi, yielding organic material to
reconstitute the soil and supply the higher layers. Here you will see big mushroom
growing on dead tree trunks. So recycling could be a big operation. However the
microbes do most of the work.
The Animals
These live and feed on forest products. They disperse seeds and pollinate flowers.
They prune plants of weak branches. They ensure the big trees seeds as well as that
of the up comer get dispersed. They make sure the forest is well mixed. The gene
pool of the forest is well mixed for strength as they enhance cross pollination. More
importantly they are the reason why there are no “bubbles” and “crashes” in the

rainforest but a stable lush forest in perpetuity.
The animals of the forest are the stabilizing factor preventing “bubbles”. If the forest
is prospering extra-ordinarily in a boom fashion the population of the animals which
feed on its products increases and puts a check on the growth preventing a bubble.
This way the animals remove excess liquidity to prevent “overheating”. The



temperature of the forest is pretty stable. The canopy blocks out the sun keeping it
cool. In some forests debris still accumulates over a long time and it takes a major
event to restore balance like a spontaneous forest fire ignited by lightning, or heat on
tinder. The rot is burnt down and the forest starts afresh cleansed of its inefficient
parts. This is the only way the seeds of some plants get to germinate: after burning!
These fires are the recessions and depressions that happen once in as century. We do
not allow the full effect of recessions to cleanse the market, so our markets are not
optimal but full of dross, riding from crash to the next crash.
Humans
Humans have lived in equilibrium with forests and still do in many places. However
forests in general are under threat from human activity like illegal logging, poaching,
and change of land use for agriculture (e.g. to grow crops for “green’’ fuel or
Amazonian soybean) or for settlement. This is equivalent to the cataclysm of
changing the economic system, like the Bolsheviks did in Russia early last century, a
failed project that neither provided enough food nor fuel but left a gullaged
dissatisfied populace who went back to “natural use” in a reverse revolution that sank
the artificial enterprise, the Soviet Union. The forest is a natural enterprise.
Capitalizing it kills it. It should be run as a mixed economy with clear regulations if it
cannot be left alone.
Part One
Shared Risks.
In the forest like in the commercial market there are risks common to all players.

Human Activity.
Human activity is a nonspecific stress on the plants and animals of the forest. The
loggers create routes and move heavy equipment to get to the big trees. They kill a
giant that has been growing for hundred years dislodging the birds and animals that
nest on it. They move the log and heavy equipment killing more plants and animals.
They change the topography by making roads and might cause erosion. Who knows






what the effects of the sudden gaps in the forest cover are on the equilibrium of the
rainforest? Government intervention in the market place could be as disruptive as
unregulated logging in forests. Business wants stability and dislikes uncertainty. It
enables it to plan into the feature. Changing market policies make it impossible for
businesses to project into the future. Frequent government incursions into the market
with policy changes kills businesses like illegal logging kills trees
Friendly tax schedules brings in investment and has been used to unleash specific
industries like IT and green technology in many places, or promote an economic zone
like Dubai in the UAE and Cotonou in West Africa. Conversely many businesses have
left Cameroon in central Africa because of extreme taxation. Just like human
encroachment forces animal life to migrate from the forest, government policy may
force business to migrate to other markets. Human activity was going to kill a forest
in the Dust Bowl but for tree planting.
Disease.
Forests are more resistant to sporadic disease and pests than agricultural vegetation.
I certainly have never heard of a forest or a species in it failing from a disease
outbreak. The intense cross-pollination is certainly protective. The diversity within
the forest is also protective for one species may be repelling a pest that afflicts

another while benefitting from it adding nitrogen to the soil. Similarly a diversified
economy is more resilient, so is a business with multiple streams of income. It is
certainly good it cross-pollinate an investment portfolio with as broad set of assets.
Fire
Fire is a major event in the life cycle of forests. The loss is great but they always
recover fully. If they were frequent they could permanently damage the forest. The



analogy is with recession in market cycles. Markets have always recovered fully in
terms of volume but recessions unlike forest fires are not allowed to run their natural
course, so inefficiencies and structural deficiencies remain. After a forest fire the
vultures come! Even animals could not run, they were burnt like grass. It is that
thorough a purging. An economic depression is like a bad inflammatory process,
necessary for healing, but so exaggerated that the patient is threatened to die from it
rather than the disease.
The Emergents.
1. They operate in a capital intensive industry like oil prospecting and extraction
of which Chevron and BP are examples or the aircraft manufacturers.
2. They have been around a long time , for example HSBC( started in 1865)
3. They dominate their market overwhelmingly or had little competition, for
example the technology companies Facebook and Google.
4. Or they are state owned. These are often monopolies servicing whole countries
with direct government help.
State-owned behemoths.
These are state-owned companies commonly in the area of utilities or mineral
extraction. They are power companies, water supply companies or national oil
companies, other mining companies, rail companies, agricultural companies and such
like. These were much more common in the days before economic deregulation and
privatization. They were staple in communist and socialist systems, and also utilized

by nationalistic governments to gain control over sectors of their economies to the
exclusion of foreign players. This they accomplished through nationalization. The
companies were also attributed a national security function: they were used to
exclude foreign persons from “sensitive” sectors with national security significance.
And finally they were used to help conserve the balance of payments of the countries
that owned them. Imagine a foreign operator providing utilities in a country as a
monopoly or at the mildest with great dominance, it amounts to a drain pipe on the
foreign exchange of the host country. The solution to this was a nationalized



monopoly. The Russian giant Yukos remains a monument of the period of privatization
that made the state-owned business model obsolete.
The capital intensive sector.
Some sectors of the economy are inevitably capital intensive making firms that
operate in them large out of necessity. A good example is the oil sector where drilling
is very expensive. The terrain for their work can be difficult, with off-shore rigs
required in some situations. The volumes of commodity moved are very huge and
require expensive infrastructure like pipelines. Further processing requires very
expensive plants (refineries). Thus oil companies are huge operations requiring a
great deal of capital investment. Airline manufacturers are a second group of
companies that are huge by necessity. Their product is highly complex, possessing a
great many component parts, with their being stringent regulations to meet. Aircraft
are expensive products, so are the plants and processes to make them. Thus aircraft
makers like Boeing and Airbus are among the biggest companies in the world.
Little competition.
A company that develops software has copyright to it for a stipulated period during
which it can exploit it for profit exclusively. When there are no comparable
substitutes then the company can have very profitable pricing and optimal sales. Thus
the company can grow very rapidly, and needs to grow rapidly to satisfy demand.

Microsoft and the Windows operating system exemplified this in the 90’s. Secondly
the nature of the product and structure of the market means that as massive as the
market is there will be only a limited number of companies making products because
of the need for compatibility (different products being able to interface and function
with one another). Compatibility with the gadgets of family, friends and colleague at
work is a very important matter among consumers. People usually consult members of
their circle before making the decision about which tech product to buy. So a limited
number of companies emerge most popular. If the market is so huge and there will be
but a few companies operating it they (each) have to be gigantic.
Microsoft grew on shrewd business practices to dominate a new field. No company
could take on it blow for blow. For it swung hard and heavy, closed-up distance



quickly and the opponent could not swing back. Even using the occasional head butt.
Not willing to bite in disgust for reducing the noble sport to a dirty brawl their
competitors have avoided pitch battles but gone around flanks to pick up niches. Big
business behavior is indeed big predator behavior where competitors avoid conflict by
specializing in different game. Actually it’s the looser who avoids the prized meat.
Forced to draw on greater creativity Apple “computers” became better known for its
mobile phones.
Now there is a move to unify titles. Google use to be a browser, now it’s an email
service selling books and offering free internet phone calls, also selling software and
apps, managing music and running mobile telephony. The actors in the sector seem to
seek a model that provides a comprehensive service to their customers so they have
no need to look elsewhere. Everything they need in one place. A one stops shop.
The competition between the American aerospace company Boeing and the its
European counterpart Airbus Industrie illustrates this strategy to accommodate each
other rather than mutually annihilate each other seen at the top of the food chain.
Competing for the long distance flight market, Airbus was going to make a buzz by

making the biggest airliner ever; which was going to convey huge numbers of people
to regional hubs from where to continue their journeys. Boeing chose to go farther,
providing direct flights to centers for which passengers may have otherwise had to
change planes. Airbus offered airlines cheap through scale of capacity. Less cost
moving large numbers of ready passenger plus the spectacle, wonder, excitement and
attraction of the biggest airliner ever, the A380. Boeing offered airlines cheap
through scale of range. Eliminating the need to change planes.
Old companies.
Some big corporations accumulated their assets over a long time. Some have been big
for a century.
Modus operandi of the emergent gigantic companies.



Like the emergent trees of the rain forest these giant companies are very secure in
their finances and business. They deal with competition that is not stifling but mostly
about market share. They don’t face a day to day threat to go under. They are
relatively sparsely concentrated (yet are in real competition with one another). The
threats they face like with the trees come from within. The little foxes that spoil the
vine. Historically they have been hit by accounting malpractice-cooking the books,
dangerous loss making trading, and bad mergers.
Lesson from the rainforest
The way the emergent trees carry out business lends lessons to the big
conglomerates.
1. The focus of their growth activity is strengthening their stem and root system.
Compared to their size their foliage is not impressive as they usually consist of
a few branches, sub-branches and unimpressive leaves. Their flowers and
fruits are equally bland. They do no invest much in these. This is the strategy:
they are by nature tall trees and have their foliage well above the canopy so
they get sunlight absolutely without any encumbrance. This is the equator

where sunlight is abundant so they do not require too many leaves to catch
the sunlight they need. The smaller foliage also minimizes the drag of the
wind on the tree. The biggest challenge facing this group is staying- up at that
height. So they focus on reinforcing their stems and roots. They are as good
as the stem and roots that bear them. The goal of this strategy is to endure,
while for other plants that produce beautiful flowers and sweet fruit it is to
produce as many progeny as possible before when they fall. The emergent
plant is there from century to century, strengthening its stem and roots,
increasing in girth by the year… and yes dispersing seed and making progeny.
It may not have fruits for the animals but certainly the lumberman
appreciates the work done building the great boughs.
2. The giant conglomerates do not face mortal competition. Their market share
is pretty secure. In a way they have already beaten the opposition. The issue
for them is staying big not staying up. They do so by strengthening their base
through mergers and acquisitions and new product offerings. They also
strengthen their base by lending out their franchise. Mergers and acquisitions
bring economies of scale: the same processes are done at lower unit cost, and



capacity is used more efficiently. This amounts to cheaper production costs,
greater competitiveness and greater profitability. Scale is advantage and big
companies have it. Their best strategy is maximizing this advantage like the
big trees of the forest do.
3. These are the pitfalls of being distinctly huge over your neighbors in the
rainforest. They could suffer a lightning strike. A big company like a big ship
could go down quite quickly and suddenly. A lightning strike could set the tree
ablaze or destroy it in a less dramatic fashion. This has been seen in the stock
market when a company’s stock goes into free fall, often as a result of a
single event in the life of a company. A French bank was plunged into crisis

after one it’s traders lost two billion dollars. It is hard for the tall trees to
protect themselves against lightning being distinctly taller than the canopy.
Huge companies who must necessarily place massive funds under the control
of single individuals must set up early warning mechanisms and also take out
insurance.
4. The same scenario elucidated could happen following an erratic decision by
top management. The British media agency The News of the World sank
pretty quick following poor judgment about what is allowed and not allowed
in the practice of sourcing news. This profitable news agency had to be
scuttled as this one practice it was engaged in proved pretty toxic. It was
reverse role play when journalists used Gestapo or KGB methods. I wondered
whether the voluntary disbandment of the media house was done to prevent
the light being shone long on the whole it was part of. To dispel focus. A
gangrenous member was cut off and it would not be known the state of the
rest of the body. I was surprised such a valuable venture as The News of the
World was preferably sunk as against being sold. It was like the news agency
was struck by lightning.
5. A steadier problem the tall trees have to face is wind…sometimes storms.
These are quite frequent in the wet season when torrential storms seem to
want to tear whole trees apart. The trees weave from side to side wrestled by
the rainstorm spreading out its branches like the fingers of one hand as if to
wrench the very life out of it. This happening to a standalone tree giant well
above the canopy is a ghostly sight…almost sickening. The giants have to put
up with storms. Like BP had to do last year with the deep water horizon oil
spill in the gulf Mexico. It was a global storm that caused the head of BP to



fall and will leave its coffers serial billions short. This was combination of
environmental and host community interest beating on a company. It was not

a one off but rather one in a series. It is important to note that companies
like BP seem to compete more with environmental groups than oil companies.
Their adverts are directed at sanitizing their image, announcing their effort at
developing renewable energy, their belief in sustainable development, and
investment in social development. Environmental activism, labor rights, host
community activism and the anti-capitalist/anti big business movement are
the frequent winds attacking the emergent companies. The oil giants do not
advertise their products they advertise their good works.
Social responsibility
It is now almost an expected part of the package for companies to be involved in
social projects and philanthropic activity. The common coinage used is to “give
back”. It’s been long in practice for companies to support social causes.
Sometimes in self-interest and a few times without it being obvious what the fit
stands to gain. Today it is almost expected of companies to be involved in this
activity: scholarship awards, endowments, health courses etc. Some pay a
percentage of sales, like a voluntary sales tax. Indeed the practice is now so
entrenched that in some host communities what companies are subject to amounts
to coercion. I know of incidents when thuggery has been used to extract charities
from companies. Agents of the community mounted a roadblock barring passage of
vehicles of this company which meets its statutory obligations. How many times
does a company have to pay for the cost of its legitimate activities on the
environment and the local community’s land? How many times does it have to pay
using roads, ports, and power and telecommunication lines? It is important to
blow the whistle on this piracy going on against businesses world-wide. These
companies are big defenseless ships marooned in foreign locations, flying foreign
flags. Being great agglomeration of resources they become the victims of
organized buccaneers and thieves often in alliance with local chiefs. Disguised as
community activists they extract protection monies from these businesses. Their
communities never see the funds so the dissatisfaction continues. Even kidnapping
of staff of these companies has been used in the Niger Delta. The limited civil war

that broke was due to the privateerism that had been at play in that wild, wild
south.
This is not to say there have not been violations by companies on the rights of
local communities. But where this has happened there are proper channels and
due processes for seeking redress. It could be hard to deal with the clout of some
multinationals government may not be representative. Yet there is no place
wantonry that serves only the interests of malignant elements not the community.
Companies must pay compensation when they violate people’s rights. Charges
should be pressed where crimes may have been committed. The problem is
government who collects taxes and royalties but do not benefit communities. If
government did its duty business would not need to pay twice.



Charity has always been voluntary, it is wrong for the poor to steal from the rich
just as it is wrong for the rich to steal from the poor. It is wrong for society to
victimize the rich minority for it never has been a crime to be rich or black or
female.

The Canopy
Here is where the competition is stiffest. The trees compete for sunlight. In the market it is
a competition for market share. First they have to be seen by potential clients so they
advertise intensively. It is a delicate balance where loss of focus could cause a terminal lag.
Falling short at this level of the forest deprives from sunlight and leads to poor tree
health. An occasional tree would be seen to be lanky and sickly as it races upward in
the shadow of another, sometimes even bent, seeking the sun. The biggest problem
facing firms at this level of the market is competition; it is a fight to the death. They
compete for customers, suppliers, staffing, location and any necessity or privilege
important for that line of business. In the rainforest there are no fanciful strategies
than to send the root deep and wide, grow, grow, grow, and make a many leaves.

There are some advantages of being in the canopy. It means that many risks are
shared: like the risk of a lightning strike, of being felled in a storm: the trees standing
together comprise a wind breaker so they protect themselves collectively. They are
one continuous layer of such that animals live and move among their branches as if
were an elevated field. So they make a great contribution to hosting an element of
the forest, animals, which serves a function important to all.
Lessons from the forest.
1. Middle-range companies must work actively to increase their customer base.
There are two approaches to this. One is directly advocating among potential
customers to promote their products. This has been said to be about
persuading the audience that they need the product. They may use audiovisual
commercials, direct physical campaigns, or sponsorship of sports, television
programs or artistic events. They may have a marketing strategy incorporated
such as a free trial. There is usually an advertisement department and an
appropriate budget dedicated to it.
2. The second strategy seeks to give the customer a better deal than found
elsewhere. To offer them better pricing; better value for money.
Advertisement contributes significantly to the final price of goods and services



so by minimizing expenditure on advertisement prices could be lowered. Or
the saved funds could be used to add quality or quantity that is obvious to the
customer at the same price. Good wine needs no bush. The customer is looking
for a bargain and will buy greater value for money every time.
3. Getting the roots down and wide. The company must secure its supply chain
because it cannot afford to default on orders. Lost orders are lost to
competitors. It must therefore order its inventory ahead of time, three
months ahead is a good period but studies should establish what the trends
are. It is also good to secure suppliers down with written contracts.

4. Since pricing is the most important competition point it is important to
appreciate that part of the measures to minimize production costs is to
minimize the cost of raw materials and supplies. All other costs must also be
kept as low as possible working in the canopy.
5. Players in the middle range of business must keep abreast of what is happening
in the market, especially what the competition is doing. They then respond
accordingly to remain at the edge of business.
6. Finally there is still a place for cooperation among competitors. Firms should
cooperate where there is common interest. Some things are best done as a
group. Scale is an advantage already high-lighted. If companies in the same
line of business cannot annihilate the competition (and the law is weighted
against this) they must co-exist. There are always determinants common to all.
Challenges they all have to deal with. Working as a herd may enable them
solves the problems more easily. Indeed this may be the only way to ward off
local government or state and federal regulation. Even warring parties do enter
into truces and cease fires, to continue belligerence at a later date. Like the
trees in the canopy collectively form a wind breaker canopy companies ought
to work together to develop common interests.
The understory.
This is a third tier of plants. They are shrubs and small trees that have no way to
compete directly with plants in the canopy, nor can they compete with the
emergents. They have to overcome inevitable disadvantages of being small. These



include being deprived of sunlight as they are completely shaded by the canopy
overhead and being vulnerable to damage by animals (because of their size). The
advantage they have is being completely shielded from storms, and from lightning.
They solve the problem of low access to sunlight by a variety of measures. Some are
climbers, for example the yam plant. They climb the stems of plants in the higher

levels: the canopy and the emergent, by winding around them or through hooks, till
they emerge in sunlight. The cocoyam plant solves the problem by having large
telescopic leaves that seek to catch as much of the dim light that falls on them as
possible.
The plants solve the problem of being small and vulnerable to animals in a variety of
ways. Some make poisons that kill animals that dare nimble on them, a toxic cassava
plant type, and a flowery Cocoyam do this. Some produce irritants: the ordinary
cocoyam plant does this and contact on the skin by its juice will cause irritating
itching. It is even more irritating in the mouth. Some like the banana plant depend on
making suckers for propagation as it wouldn’t be possible to maintain seedy fruit so
close to the ground to maturity, especially banana fruits! Hence the banana is a
seedless fruit. They banana plant races to a fair height making a largely watery,
turgid stem; fruits quickly and dies to create space for its suckers. Among plants in
this layer are biennials and annuals. Biennials grow and fruit twice a year; annuals
once a year. The hazard of being mortally damaged by animals is so great that these
plants elect to race and finish their lifecycle then die voluntarily. Also some would
store their reserves underground (the cassava, the cocoyam and the yam are all
tubers-underground stores) to prevent them being damaged or bringing damage to the
plant by attracting animals.
Lessons from the rainforest
The lesson from the third tier of plants in the forest is to provide what the bigger
businesses cannot offer. Competing with them is out of question. It is clear that
plants in the understory layer of the rainforest try to make the most of their
prevailing situation and still achieve success. The grasses feed the world. These
include: wheat, barley, rice, sorghum, millet, corn, and such. The tubers feed the
tropics: yams, cassava and cocoyam. To qualify for a place in this roll of fame the
plant must be able to use sunlight to capture carbon from the atmosphere very
effectively and efficiently. The grasses of the savannah, the prairie, the steppes and
such open spaces do so. But the title goes to the tubers that do the same from under

a shade. So the small mama and daddy company have a place in the market and can
survive if they copy the little plants of the rainforest.
THE GRASSES FEED THE WORLD… and the tubers too: The grasses: wheat, barley,
rice, maize or corn, millet, sorghum, sugar cane feed world. The tongue–shaped
leaves, tall fleshy stems and the large amount of seed on a very few fruits are their
hallmark. Their seeds are used to make flour everywhere. These belong to an
exclusive group of plants called C4 plants to which only 10% of all plants belong. The
others are called C3 plants. C4 plant captures carbon dioxide from the atmosphere
faster than C3 plants. No wonder the grasses feed the world (the animals included).
They grow fast and yield a crop in months. Unlike other plants their leaves grow from
the base up, so if grazing animals chop off the leaf tip the leaf continues to grow.
Other leaves grow at the very tip. If bitten off growth stops. The grasses are energy-
capture machine which are not into fanciful flowering, nor permanent structures like
strong woody stems or much root. They pack carbon from the atmosphere as fast as
they can and are done in less than a year. They are very easy to grow.
The tubers: yams, coco -yams and cassava make a good impact feeding the world.
They are the carbon packers of the rain forest. Having to compete for sunlight yams
are climbers , that way they reach the top of the canopy, the coco-yams don’t go for
height, they have two or three permanent broad leaves like telescope dishes catching
every light signal. This design precedes the parabolic dishes of astronomic telescopes
and satellite TV receivers. The cassava makes no seed; channeling its effort towards
storage (underground) of the carbohydrate it makes and like sugar cane (a C4 grass)
can be grown from the stem. It does not invest in permanent structures. These
rainforest carbon packers cannot afford to make seeds or store carbohydrate above
ground as the density of bird and animal life would not allow it. The seeds or stores
would be eaten.
1. Offer what the big rival cannot offer. Like hand made as against machine
made. Your clientele is small, so take advantage of it. Produce with extra

quality, with the level of attention to detail that a machine could never muster
and you will sell at a premium. No competition. Indeed the small business and
the big business should not be in
competition unless it is the small business doing the hostility on a soft
underbelly that a big company allows to develop.



1. Offer human touch. A small target of customers means solutions can be
customized. So know your customers and give them tailor-made solutions.
Follow-up and give them after sales support. Bond with them as you work to
see them succeed and they will to see you are fairly rewarded and are around
to continue helping them. You have limited clientele, nurture it, groom it and
keep it. It is your advantage if you exploit it, your disadvantage if you don’t.
2. Seek every opportunity to increase your customership. Like the cocoyam’s
broad leaves or like radar sweep zones in search of clients and let none slip
through the net. Like the yam take every opportunity to see the light. Climb
on the shoulders of the internet to advertise (operate a web site, market on
line) Climb on the shoulders of e-bay. Use word of mouth. Take declassified
advertisement.
3. Save like the cassava, expand like the banana. The cassava plant makes no
fruits but is spread through cuttings. It saves everything. Do not waste
resources. Your capital base is small and can easily disappear. The banana
plant makes no seeds, it spreads locally. Do not hurry to set up branches in
other locations until your present store/office/workshop is fully maximized.
There are linking costs that will develop in running more than one business
location. Before you branch out be sure the figures add up. Make sure your
profit increases or your business is more secure.
4. No foolish risks that could threaten the existence of the business. You have to
be toxic to practices that can cause the business to go under. Of-course like

stealing from your business. Remember your capitalization is small and can be
easily wiped out.

The forest floor
Here a general service is provided to the forest turning dead material into manure.
Plants utilize energy from sunlight to synthesize organic material like cellulose
(fiber), carbohydrates (starch), proteins and oils. When plant material or animals die
the forest floor takes care of business. Saprophytes devour the dead plant or animal



tissue breaking them down to simple substances that other plants use and eventually
animals, up the food chain. The saprophytic sector involves ants, worms, and fungi
large like mushrooms and small microbial fungi, bacteria and other microscopic
organisms. Ants and worms break down the dead material to finer particles and
increase the surface area available for the microbes and mushroom to act. This
recycling process is critical to the existence of the rain forest as the soils are very
poor being shallow and leached by the heavy rainfall. Nutrients must be recovered
from the dead plants and animals or the forest will not be. The recycling sector of the
forest is very advanced, sophisticated and rapid. So it should be with human societies
especially cities, for humans produce much more waste per head. What a waste it
would be not to take a cue from the forest.
Recycling is still a novel idea in most of the world (though it’s going on in nature all
around). How many recycling companies are listed on the stock-exchange? It is a
veritable sector to grow a business in, especially in the developing world. The
potential here is like it was in the IT sector in the early to mid –nineties. In the
market the forest floor represents the businesses which provide the services for other
companies. Who provide bags for retail shops, components the automobile giants,
pipes and such for the oil giants, researchers and recruiters, banks and insurers…
small contractors that do things for businesses that businesses cannot efficiently do

for themselves.
This sector has no specific risks. They expand when the forest expands and contract
when the forest contracts. When the forest expands, it produces more debris, the
saprophytes feed on this and increase, this ensures the saprophytic function matches
the need of the forest. There is a negative feedback in operation here. If the
saprophytes lag behind the growth of the forest, debris accumulates and disease may
break out. Or a fire as tinder accumulates, ignited by heat or lightening.
When the economy expands the support sector expands, when it shrinks the support
sector shrinks. This concern was one of the reasons why the America auto giants were
bailed out during the credit crunch of the late 2000s. Indeed the performance of the
support sector could be used as an indicator of the health of the economy and as a
control point to stimulate growth or check overheating and inflation. This is already
being done through the banking industry by controlling the supply of money or the
cost of borrowing. This is done through the instrument of the interest rate. Insurance
regulations could be used to remove carcasses from the system, by manipulating
benchmark criteria for obtaining insurance. This is happening passively as companies



in a bad state would have difficulty finding insurance. Regulations making obtaining
insurance by companies mandatory will help protect investor and customers.
Veritably, the scrutiny of insurance would help tell the real state of companies and
could expose malpractice in accounting or operations.
Poor soils.
The success of rainforests in spite of poor soils mirrors the success of countries with
little natural resource like Singapore and Japan. It demonstrates the importance of
recycling for one, the importance of good management and the importance of
efficiency. Indeed abundant mineral wealth could be a bane to development as it may
produce a single-commodity economy and foment corruption as leaders scramble to
steal from the sales of the mineral. This was epitomized in the diamond war of Sierra

Leone and Congo DR, and has been said to be the bane of Nigeria. Discovery of oil
wealth in Angola raised concerns, a paradox predicated on happenings in other places
including Sudan. The Kimberly process to regulate the sale of diamonds and prevent
its use to fund wars demonstrates how serious a destabilizing factor wealth in the soil
can be. It is striking that those countries low in natural resources have economic
centers with housing structured like the rainforest. Skyscrapers, buildings of
intermediate height, and low buildings. Singapore has the highest number of
skyscrapers. It would seem that depending intensively on commerce and industry (the
market) rather than the sale of a natural resource produced this structure, the
different heights reflecting different sizes of businesses. Thus this multilayered
format may be the principle for any system that allows free intensive competition.
The single-resource countries still have rather flat city profiles. They dig deep but
don’t grow. While in the market-driven countries spread flat and grow tall. The
shallow soils warrant the trees of the rainforest to have expansive buttresses that
spread up to 30ft to keep them secure. Roots the sizes of tree trunks that you can sit
on are not rare in the rainforest.
Lesson
1. You do not need massive amounts of capital to start up off and succeed in
business. Shortage may inspire creativity; surplus may kill drive.
Leaves
The leaves of rainforest plants are adapted to the ecosystem. They have drip tips and
grooves in the lower layers to conduct water and facilitate water loss from the plants



through a process called transpiration. They are large in the shaded levels but small
and dark green in the
emergent layer to achieve the opposite reduce desiccation by dry winds. Some leaves
are on stalks that turn with the movement of the sun.
Lesson

Leaves are represent the productive units and are equivalent to the machines or the
non- mechanized production processes of firms. Like the leaves of rainforest plants
they must be:
1. Fully suitable for the environment in which they are operated to reduce down
time.
2. Fully suitable to the uses to which they are put and be streamlined to the
production process to give optimal efficiency
3. Like the leaves that follow the sun, follow the business everywhere it goes.
How to use lessons from the rainforest to start a business.
The rainforest is a free system, it is indeed freer than the market, and therefore its
overwhelming success confirms that the free market is the optimal system. Its model
promises balance and abundance without bubbles and bursting. These examples
illustrate the application of the principles discussed so far.
ENTREPRENEURSHIP
You want to start a business; the first thing is to determine what part the forest the
business you visualize falls. The emergents, the canopy, the understory or the forest
floor. Second do you have the resources required to play in that layer. For example
Mr. Smith has been working as an executive for a bank for ten years and has been
seeing the finances of his clients. It has been leaving a hollow in his belly comparing
their profits with his wages. He believes he can do it so he contemplates resigning to
launch out on his own. He thinks he could gather a team and muster the funds
required to start-up a business making electric cables and fittings. He had been
managing the finances of a firm owned by a client his age whom he had got to know
at a personal level. This friend was in the electrical wire and fittings business. The



first question Mr. Smith has to answer is where in the forest of he wants to enter?
Does he have the start-up capital? Can he find the team? How far up would he like to
grow the company? There are big, medium and small actors in the electrical fittings

business.
The realities are that Joe is using his savings for the venture and does not know the
business very well.
Advice: He has to find a river bank. Here the vegetation is not dense and trees are
sparse. So there is no significant competition. However there is no shielding from the
wind and the river floods from time to time. The grass is almost choking. But there is
sunlight, and plenty of water.
Smith decides to start up in a locale where there is no competition but he must trade
this off with their being little logistics. He decides to strain against predictable
challenges like poor supply networks, poor market links, than combat suffocating
competition. If his business dies it would be a slow death and he will have time to
make changes or run. In the thick of it, inside the city, he may never take off. The
high cost of logistics could easily smother his business. From the periphery he’ll have
the time to learn more about the business and possibly develop a niche that takes
advantage of being away from the rest. Per chance turn disadvantage to advantage.
If he succeeds he’ll have the advantage of a pioneer in the locality of his startup.
He’ll be a prominent fixture in its commercial landscape; capable of securing it’s
resources like choice locations for himself. He’ll be ahead of any new comers in local
knowledge, business connections and political links. It may take a while though to get
there.
Jasmine is a skilled teenager with bright ideas and great IT skills. She’s had a blog
since age nine, has lived a good part of her other nine years on the internet. Maturing
she’s having more responsible ideas about using her talents she wants to start a
commercial internet company, but the field is obliterated by Facebook, you tube,
Amazon and an endless list of behemoths and she has no money. She climbs on the
giants. She starts a site where people contribute stories about celebrities, posting
pictures. She spends hours daily hunter-gathering celebrity news from the giants’
websites and others and retelling them on her site. She gathers links to freebies and
posts them for her visitors, uses word of mouth and every legal tactic to spread the
word. Eventually advertisement comes and it includes products from celebrity: their

material, memorabilia and events. She entered the forest at the understory level and
climbed on the giants there before to sunlight.



In the world of telephony Skype is an emergent in terms of the volume of calls being
made on their network at any time over (twenty million). This was achieved through
innovation as the company made a business out the cheap cost of routing calls
through the internet. The telephony business is a playground for giants and Skype
took advantage of a single trait to emerge from the canopy. It would not be surprising
if they branch out into the software and apps business, social networking, and on-line
retail. These are all in her environment.
The first step is to find out what level of the forest the prospective company will
operate in and conduct it accordingly. A little use of the imagination would be
helpful. Imagine you are a banana plant in the understory layer with broad leaves to
capture light and you have no seed, but grow by sprouting out new suckers. You
produce a sweet fruit twelve feet above ground. What are you gonna do? Advertise or
not? You won’t! You won’t spend resources growing a wooden stem. It would take too
long. No! You make a stem that is fleshy and watery (that allows you to grow fast)
leaving the making of your fruit to the very end of your growth period when you have
the most clearance from the ground. At twelve feet above ground you produce bunch
of sweet fruit and bow out (giving the new suckers room). This way you are famous
around the world. Bananas make no seed but they proliferate through every
household and compound, wild bush and farm and a thousand plantations.
The banana raises the question of advertising. Must everybody advertise? Even when
you cannot keep up with demand? When there is no promise of it increasing sales, like
when the competition is far ahead and too strong? Why don’t you just put the
advertising budget to use enhancing your product, or developing an altogether new
product. This is the strategy of Apple in its struggle with Microsoft.
Most fruit trees are in the canopy or understory. The emergents generally make bland

unattractive fruit. Trees like mangoes, guavas, and oranges overcome the threat of
their progeny being consumed by making lots of seeds in lots of fruit. The papaya
plant makes very many seeds in not many fruits, the coconut hide its seed in strong
hide. There is only fibrous covering, no fruit. The white pulp is the inside of its seed
and you must crack open the hard shell to reach it, in which case you are eating seed.
This seed will float on the ocean to germinate when it makes a landing on the shore,
sometimes on islands. Thus the coconut is the tallest plant on many tropical islands.
The coconut is an emergent, making only fiber and no flesh it needs no seed
disperser. Fruit is a form of inducement to have animals a plants seed, just like
nectar is a reward to have insects pollinate a trees flowers. These inducements



resemble the bribes government officials in developing countries sometimes demand
in return for helping Western companies win contacts. It is good that this practice
now constitutes a crime in some of the home countries of the companies.
Another successful palm is the oil palm. Almost identical to the coconut it produces
many fleshy fruits around a hard nut, as hard as the coconut but much smaller. The
fruit is embedded in very sharp spikes so the fruits cannot be retrieved. A human
cannot do so with bare hands without getting injured (unless the fruit had become so
ripe until it was soon going to come off
the bunch). Uninterfered with the tree drops fruit as they ripen; a few at a time to
maximize dispersal. The fruity flesh around the hard nut is reward for the work of
dispersal. The oil palm and the coconut palm are virtually indistinguishable trees yet
one requires animal seed dispersal and the other natural forces like ocean currents.
Different approaches to solving the same problem. The lesson for business here: seek
for best fit as much as possible.
Why does the oil palm choose to pay a commission to have its seed dispersed and not
the coconut? It is because of the nature of their natural habitat. The coconut builds
boats for its seed to sail around the world; the oil palm tempts squirrels to take a

bite. The coconut is a shore plant, where there is little undergrowth or the seed falls
into the sea. In the forest the seed would not be dispersed because it’s too big and
too heavy (larger than many dispersers). The oil palm therefore makes seeds that can
be moved by small animals and birds and gives them a reward to do so. So business
needs tailor-made solutions.
When the economy is optimal and the market free there will be businesses of all kinds
and shapes making money out of every kind of advantage: huge tree trunks or broad
leaves, many fruits or poisonous stems, underground stores or water stems, last-day
sales (bananas) or spiced up shoots( the onion). Something for everybody.
Part two
GENERAL LESSONS
THE SEASONS
It is interesting to observe the effect of the seasons on the rainforest. In the dry
season activity slows a little because of the scorching sun. When the rains come the



tempo increases… there is revitalization. Seeds germinate and there is new life. One
would think more sun would mean more growth but sun is not the limiting factor in
the rain forest, water is. The real difference between a recession, normal market and
a bull market is the tempo. When the prospect of profit is good there mood in the
market is high. When the risks are high the market is downcast. How else billions lost
one day could be recovered the next day but in perceptions. The value of the market
is viewed through the colorful prism of the mood. Good mood gain in value, bad
mood loss of value. The mood was bleak during the crash of the late 2000s. With the
giants falling in a Titanic cascade, one every week, it was a ground zero in Wall Street
and people fled with what remained of their dwindling portfolios. Bankers packed
their briefcases.
It was literally last day at work. If the mood in Wall Street in 2008 wall set in music it
would have been a dirge

I did not lose any money though. Surely the next crash is on its way. The next crash
is always only a matter of time. I believe managing money is a do–it–yourself thing.
How could one hand over his life savings to a faceless group of directors and board
who are also in it for themselves? It’s not their money and they will play roulette to
make buck. How else is a billion dollars lost this hour recovered the next than by
turning a wheel? Of course it is not quite like this. However if your portfolio is too
large for you to manage and hold a day job then your portfolio should be your day
job. If you do not make as much as your money manager did it is because you are
careful. When the next crash comes you’ll hit a jackpot. Manage your money yourself
if you can. There no bubbles or crashes in the rainforest. Too rapid growth stimulates
the animal population to increase. This increases the consumption forest products so
the rapid growth is checked and does not develop into a bubble.
Yakub an Afghan refugee was looking to start a business in Pakistan. He chose what
he knew: the transit business conveying passengers over distances 50km or less. He
bought a bus and registered at the City Council bus station. The arrangement was that
bus operators took numbers as they came in the morning which was their turn to load.
Turn one loads first, turn ten loads tenth. There were nineteen bus owners not
counting those who went for repairs. With only about ten hours of daylight available
for loading and it taking over an hour to load one vehicle it meant that about half of
all turns lapsed into the next day. So the bus owners worked only every other day or
less. This is a recession. Disappointed, Yakub left the City Council bus station to hire a
store-front where he ran an independent bus station. It took only ten minutes to load



a bus. The passengers no more wary of long waits flowed like a stream. Yakub had
only seven buses registered in his company. The buses made a round trip every two
hours, spending only twenty minutes at each end of the trip to refuel and reload.
With almost thirty roundtrips the seven drivers were fully occupied and the seven
buses fully utilized. The seven buses did altogether by far more business than the

eighteen at the City council bus station.
Lesson: The difference between a boom and a recession is simply psychological: the
consumers’ willingness (confidence) to buy goods and services, banks willingness to
lend, the willingness of business to invest. The market environment determines the
prevailing attitude. The example illustrates how a small adjustment in the market
environment can change attitudes.
Big government and small government
A good way to measure how bloated a government is what proportion of its budget it spends
on recurrent costs like salaries. How much of the dollar or any currency is left to directly
produces the desired effect is another way to judge it. It can also be judged by comparing
how much it costs the private sector to achieve the same goal. There are governments in
small countries spending 70 percent of their budget on running costs. Like building a one
hundred thousand dollar house and spending seventy thousand on the workers. It certainly
won’t go very far. Some of the workers would be idle most of the time and a common sight in
the government offices of many countries. This is in sharp contrast with what exists in the
forest. Its animal life are its regulators (the regulator is always higher up in the food chain)
Yet they are not obvious in the rainforest. It will take deliberate searching to find the animals
of the rainforest.
Lesson
The regulators of the market should not be obvious. Most arms of government should not be
obvious. The exception is the police, schools and hospitals. When the regulators of the
economy or government become obvious there is need for a review of efficiency and
freedoms.
Where do I put my money?
Put your money on yourself. This is the practice in the rainforest. Plants do not
delegate their resources to second or third parties.
Lesson