[fastball]

Yes, my test is fairly simple: your business (whatever it is) should be creating value and then capturing a fraction of that value. If that is not what you are doing, the business is parasitic in nature and should not exist.

[throwawayboise]

Creating value for who? Every business creates value that someone is willing to pay for, otherswise it couldn't exist.

[fastball]

I see a difference between creating value and finding value.

For example, if your business is based around an ad model, you are not creating value because that value already existed (people's attention / purchasing power). You are merely redirecting value.

If you take facebook as an example, they are creating value for people by letting them communicate / etc. But they are not capturing a portion of the value they are creating, they are taking value that already existed (the value of your attention) and selling it to someone else.

Or take an investment bank that purely speculates on existing assets. Any time they win, it is not because they created value and captured a fraction of it, it is because someone else lost.

I of course like fb better than the ib in this example, because they are at least creating some value. But I think any business where you're capturing value in a different area from where you're creating it is one that is very likely to end up with lots of conflicts of interesting and exploitation to a certain extent, so best avoided entirely.