Archive for the ‘fear of not succeeding’ Category

A-players hire A-players, B-players hire C-players

April 28, 2009

This is one of those sayings in the startup world that is so accepted that it’s crossed the border of familiarity and become a full-time resident of the land of trite.  

Guess who coined it?  Steve Jobs.  That’s right, Steve Jobs, when he was getting the Macintosh off the ground.  It’s a phrase we used at RealNetworks a lot, and one that my partners and I use as a result. 

But that it’s trite doesn’t mean it isn’t relevant or true.  It is.  Absolutely. 

And it’s a subtle but important concept to really understand.  What do A-players do for you?  Everything.  Most important, it’s the tone they set in the organization and their influence on the behavior and performance of others. The hiring is critical too, but that’s a byproduct of everything else.

  • A-players are at the top of their game.  This means they know the difference between good and great.  In the work they do, and in the standards they set for those around them and those in their organizations.
  • A-players aren’t threatened by someone better than they are.   Rather, they’re relieved.  That stuff they were struggling with?  They’re happy to get that into the hands of someone who can run with it, faster and more nimbly.  How liberating.
  • A-players know what they don’t know.  A corollary to the point above is that A-players know when they don’t know something, and ask questions.  They have the security to not need to know the answer to every question, and know how valuable intellectual curiosity is.
  • A-players can’t tolerate C-players.  So they make sure the C-players are replaced.  And guess what? The rest of the organization is relieved and inspired.  They know who the C-players are, and have felt the drag on performance.  It may sound harsh, but it’s true.

To me the most essential capability A-players bring to an organization is the tone they set for it.  Their definition of “good” is so much greater than a B or a C player’s, it’s as if they’re speaking a different language.  In fact they are, and it’s critical the organization you’re in all speak the same language. 

This is why starting up companies is so liberating for A-players.  I remember when I was at LSI Logic in the early days, fresh out of college with my head spinning in this startup.  The CEO, Wilf Corrigan, made a comment to me once about why he loved being CEO of LSI Logic so much more than being CEO of Fairchild Semiconductor (which he had been before founding LSI).  He said “because I created a company with only people I wanted to have there, not ones I inherited.”  At the time the answer sounded sensible, but now I realize what he meant was he could hire A-players from the start. 

But don’t get me wrong.  A-players are not a homogenous bunch.  There’s a huge, huge spectrum of abilities and characteristics among them.  Some can be incredibly thoughtful and compassionate, others can be intellectual bullies and seemingly heartless.  But the connective tissue that binds them all together?  They know where to set the bar/standard and how to hold themselves and everyone around them to it.

Lots of low cost experiments

April 22, 2009

The really interesting improvements companies make come from takings risks, but in a lot of cases risk-taking can be held hostage by needing data to support every decision.  Being conservative and careful across the board may be safe, but it’s not where breakthrough learning happens.

This is where I see a lot of startups struggle:  confronting the tension that is created between knowing when to apply disciplined fact-based decision making to avoid failure, and when to be disciplined about making decisions where failure is accepted as a likely outcome.

The best companies create a culture that can foster two seemingly conflicting organization abilities: precision and failure.  In fact, you need both to reliably profit from your mistakes.

The key is understanding where in your business you can afford to routinely experience failure, and where failure has more costly significance.  You need internal processes that measure performance, coupled with a culture that has a pretty solid foundation of trust – where anyone and everyone feels comfortable taking a risk, and reporting the results as data.  I wrote on this earlier, it’s a culture where bad news has got to travel faster than good news.

Steve Blank wrote a pithy essay on how to navigate this decision making quandry and I love the quote he referenced from General Patton: “A good plan violently executed now is better than a perfect plan next week.”  This is a variant (or perhaps the inspiration) for another saying “the perfect is the enemy of the good.”

To me they drive home the value of action and experience placed on par with the value of planning and data.  Patton would never go into battle without a well thought through and justified plan, but he speaks to how perfecting the plan is different from winning the battle.

The same is true in startups.  It’s critical that they operate with a well thought through plan supported by data, but it’s equally important that they understand when the plan is no longer as important as what the real world is telling you.  It’s another way of understanding why the numbers in your operating plan are wrong, and is in fact healthy.

Steve talks about a simple heuristic, that decisions have two states: reversible and irreversible.  With the reversible decisions you can liberally experiment, and should.  This is where you can create significant breakthroughs for your company by being highly creative, and surprise yourself by taking risks, and failing, perhaps a lot.  If you’re wrong, re-load and try again.  For me the construct is learning to try “lots of low cost experiments”.

He makes an even more interesting observation about tempo.  It’s not sufficient to be able to take risks with reversible decisions, it’s to do so at a brisk tempo.  Quick, responsive, hungry.

Where this comes in especially handy is with sales and marketing performance and new product development.  In both cases you’re in a race to discover what works, and then what works on a repeatable, scalable basis.  I forwarded Steve Blank’s article to one my CEO’s who is focused on improving her sales and marketing team’s pace and performance.

Jenny Hall also made a similar observation in her post about what she learned as CEO of Trendi.com when it failed.  For her it was “if it won’t matter in three months, don’t spend too much time on it.”

She’s got the necessary ingredients: a culture of trust within the company, data-driven decision making, and performance measurement processes.  When she first arrived, these ingredients weren’t as prevalent, and she worked hard to put them in place, and placed a priority on reducing errors and increasing predictability.  But that was then, this is now, and she’s making the transition to fostering more appropriate risk taking as a way to increase performance.

Lots of low cost experiments combined with a brisk tempo supported by a disciplined acceptance of failure.  That sounds like a lot of fun.  Try it.

The iPhone – Virtualizing enterprise market share

April 8, 2009

It’s always good to state the obvious:  there is no way Apple will ever make a dent in overall PC market share, much less get into the enterprise desktop or server business in a way that’s relevant.  The reasons are so obvious most people don’t realize it.

The Mac will never duke it out at the low end, much less hang out with the netbook crowd because the lower margins don’t work with Apple’s business model.  HP, Dell, Lenovo – they get to have all the “fun” sorting out the volume/margin voodoo.  Lucky for Apple there’s a large enough segment that will gladly pay a premium for an elegant, integrated, and stable computing experience. 

And guess what?  Apple gets nicely rewarded:  in the fourth quarter of 2008 Apple’s operating profit was 11% while HP’s was 5% (for their personal systems division). 

But what about the corporate market?  What about all those enterprise customers who you can build lucrative, durable, “sticky” relationships with?  Businesses built from hard-fought battles over market share, premised on whoever sells the most laptops/desktops/servers to corporations reaps the rewards of valuable added services that run on them.  Has Apple really just punted on this?

No, they’re smarter than that.  They’ve realized in a world of cloud computing and web delivered applications, their leverage into this market doesn’t come from desktop unit volume.  It comes from inserting the iPhone into the information flow between businesses and their workers. 

But hasn’t every big mobile device supplier tried this already?  Didn’t Nokia bet a huge part of their farm on this with various “Communicator” handsets? 

What about Microsoft with Windows Mobile?  Wasn’t that supposed to provide the worker/enterprise tether?  It was but it never did.  It neither generates significant revenue for Microsoft, nor has it gotten durable traction with business users.  Dan Frommer of Silicon Alley Insider does a great job explaining why it’s a tweener in the worst way.  I can tell you that my two years using a Motorola Q were the longest mobile “computing” years of my life.  One of my partners compared it and an iPhone to “showing up on horseback (Q) when everyone else is arriving by jetpack (iPhone)”.

And as Network World pointed out, Blackberries are great at corporate email and “legacy” enterprise applications but are not great mobile internet experiences.

These companies forget that it’s not about them and protecting their business franchises, it’s about the user experience.  Apple is the first company to get the complete mobile internet user experience right.  Microsoft, Nokia, even Blackberry/RIM probably have done a better job getting mobile computing right, but in a world of web services, I think the operative term is “internet”, not “computing”. 

So how does Apple become relevant in the enterprise?  By virtualizing its market share.  The battles to be fought in enterprise computing over the next 5+ years won’t be over email and ERP, they’ll be around cloud-based services, web-delivered applications and mobile interactions with them.  Market share leverage will be measured in mobile devices, not desktops. 

And until the iPhone arrived, no one had a compelling mobile internet experience.  Hundreds of millions of other phones shipped, and they all suck at the mobile internet.

In an April 2008 report, Gartner found the iPhone is clearly having an impact on IT strategy.  Of their survey respondents, 65% were responsible for supporting, managing and/or provisioning enterprise mobile solutions.  Of these, 13% said they either currently supported the iPhone or had planned for it, 64% said they were currently researching/evaluating support for the iPhone. 

This is brilliant.  By having major corporations enable iPhone support Apple can get a meaningful share of enterprise users without having to sell a single desktop, laptop, or server:  13% share of mobile support is 10x+ Apple’s share of enterprise desktops.

No one is focused on this, and it makes me wonder if Apple likes it that way.  Keep the “iPhone is a consumer product” head-fake going long enough to get a strong foothold with enterprise users.  And if Apple can instill in those users the loyalty they’ve instilled in consumer iPhone and Mac users, well this could be brand new territory in enterprise business.

The reasons are so obvious most people don’t realize it..

Man On Wire – Best Startup Movie Ever?

April 1, 2009

I saw Man On Wire for the first time in February; I’d read a snippet somewhere about this being the story of the man who tight-rope walked between the two World Trade Center towers in 1974.  And at a certain level, that’s exactly what this movie is about.  It’s exquisite.  The tight-rope walker, Philippe Petit is almost a caricature, his vision and ambition equal parts boundless and focused.  I’ve seen the movie three times now, and each time it’s more revealing.

What viscerally strikes me is how it tells the story of starting up a company.  This is all about having an idea so audacious it’s almost not believable to someone who hasn’t drunk your kool-aid, yet.  It’s about staying focused on the one reason why you will succeed and not the 10,000 reasons why you will fail.

Man On Wire reveals four super-compelling principles that underscore what it’s like to be in a startup, and if you haven’t been in one, it’s a wonderful way to get a sense for what it feels like to be there:

  • A meticulously constructed plan, discarded.  Philippe Petit spent six years planning this act, including building scale models of the towers’s roofs, constructing a tight-rope the same length as the towers in a field, and on and on.  And guess what?  The day of the “coup” huge elements of the plan had to be thrown out, the real world just didn’t cooperate.  This is “why the numbers in your operation plan are wrong” writ larger than life.
  • Repeated visualizations of the outcome.  This is one of the critical mechanisms to ensuring you’re focused on why you will succeed.  Philippe from the moment he learned of the Towers construction, visualized walking between them.  For years and years visualized walking that wire, how he would do it and succeed. This is critical when you only get one shot at an opportunity, like he had. 
  • Significant emotional toll.  Getting something done that’s ambitious, with a visionary leader means you will do things that are difficult and way outside your comfort zone.  You will find out who the chicken killers are, who can be relied on and who can’t, and most importantly what you can rely upon yourself for.  It’s messy and painful, and you will be different as a result of this experience.
  • The fear of not succeeding.  Philippe’s obsession was on success.  Startups are all about being laser focused on why you will succeed, and your only fear is success NOT happening.  I just can’t say this enough.  People who are afraid of failure may very well get great things done, but just not at startups.

For me the most piercing and fiercely honest confession of the entire movie is when Philippe describes the moment when he committed himself to walking that wire.  A simple shifting of weight from the foot resting on the tower to the foot resting on the wire.  Silent and internally deliberate. 

Compare/contrast this with the article in this April’s Outside Magazine about why people participate in risky sports, and profiles BASE-jumper Ted Davenport.  Neuroscientist Russell Poldrack asserts that there are three ingredients to risk taking: desire for adventure, relative disregard for harm, and acting on your desires without fully thinking them through.  That last factor strays way, way too far into the landscape of recklessness and separates Philippe from Ted.  There was nothing reckless about Philippe Petit.  Deliberate, honest, ambitious, meticulous.

So see this movie for the reasons I outline above.  Also, let yourself ask the other questions.  Like “how can someone afford to spend six years planning this”?  How “real world” is that?  We’re not getting the full story here, but it sure is enjoyable. 

Before your Netflix delivery arrives watch Philippe break Stephen Colbert out of character on the Colbert Report, and you’ll hear Philippe describe that moment when he shifted his weight onto the wire.  Mesmerizing.

Effective networking – as easy as public speaking

March 19, 2009

Over the past few weeks I’ve had a series of conversations with people about what makes an effective networker, and following up my post about the Seattle 2.0 Awards event, “networking” seems like a timely/relevant topic.

To me networking is the ability to develop a real and sincere personal relationship with someone around a topic that the two of us find interesting, relevant, and important.  It’s bidirectional, about giving and getting.

No surprise it has nothing to do with LinkedIn or Facebook.  Just look at the About LinkedIn page: “We believe that in a global connected economy, your success as a professional and your competitiveness as a company depends upon faster access to insight and resources you can trust.”  This is under the heading Relationships Matter.

Wait a second, this is about stuff for you, it’s not about relationships. 

Networking is about taking “what goes around comes around” to heart, and focusing on what you give to someone, beginning with an understanding of that other person.  It’s creating some durable residual value through a conversation, and the goal is to produce a lasting memory of you and your talent/intellect.  Along the way they’ll learn about you, but that’s secondary; it’s the byproduct.

OK, but this can be scary to do.  You are going to reach out to someone you don’t know or know well and ask for something.  In some aspects, this puts you in a situation similar to public speaking (and we all know how comfortable that can be for people).  You need to “perform” and expose some vulnerabilities.  It gets a lot less scary for me when I don’t view this as networking, and instead view this as a way to form and nurture a personal relationship.

Perhaps in this first conversation you do have a favor to ask, or maybe you just want to establish the relationship, or have this person keep an eye out for a role or opportunity relevant to you.  It’s this slice of memory that will provoke them to make the introduction you just asked for, remember your name and repeat it to a relevant contact, or to take your call and grant you a favor someday later when you ask it.

I do this all the time for people, and I don’t mind it one bit.  As a matter of fact, I love it.  I just did it while writing this post.  Someone I know has taken on an ambitious consulting project, and a former colleague of mine who has since become a rock-star marketing exec could help her out.  I loved connecting them, a good fit of two thoughtful, talented people –  who I have real and sincere personal relationships with.

This is taking your values as a person and applying them in a professional context (something I touched on in an earlier post) and doing this in an interpersonally “deliberate” manner. 

And then I thought, well there is networking I hate and am not comfortable with.  It’s the “forced” networking of work-related events – when you’re in a crowd and making the small talk that on occasion produces an interesting and memorable discussion.  This is perverse because in my role as a VC a big part of my job is to get out into the market, to attend events, and to “network.”  I am horrible at small talk, and I admire people who can establish ease and comfort quickly with someone new, and find some common ground.  I am still learning here.

But I approach this in the same way I had to learn to speak in public.  It doesn’t mean I’m always comfortable, it just means I’ve trained myself to do it.  And there are a lot of conversations along the way that just seem to fill space and time, but there are also those moments when I meet someone where we can establish an actual, meaningful conversation.  And then I’m right back in my comfort zone.

Failing in Style – Guest post by Jenny Hall, former CEO of Trendi.com

March 16, 2009

Jenny Hall has graciously agreed to a guest post.   Jenny was the CEO of Trendi.com, a social networking destination focused on young women’s fashion that was shut down in October of 2008, and discusses what she learned as a first-time CEO through the startup and eventual failure of Trendi.

This blog focuses on this juncture of success, failure, and finding the meaning from each.  I think you’ll enjoy what Jenny tells us through her first-hand experiences at Trendi.  Thank you, Jenny, for being OpenAmbition’s first guest writer.

——————-

I really don’t like failure, but I know it’s one of the best sources of learning. I learned a lot the past few years working at a startup, and I learned even more as a result of it failing.

I joined Trendi.com in March of 2007 as the head of marketing and I ended at Trendi in October of 2008 as the last employee and CEO. We had investors, a smart team, a fabulous domain name, a popular blog and so much more going for us- so many reasons to succeed– yet we failed. 

When people ask me “what happened?” I usually say we ran out of money. That’s the cop-out answer- running out of money is a symptom of the underlying issues. I think our underlying issues were communication related (unclear communication with each other, of expectations, and with our customers) and experience related (being young, excited, wanting to do it all and getting nothing done.)

I learned lessons from the mistakes we made as a company and my personal mistakes. Of the many lessons learned, these are the ones that stand out the most to me.

Your target audience should be so excited about your product that they’re pushing you to launch, even if it’s crappy when it launches.

I joined Trendi after the founder received funding for his idea. (I know- that never happens! We were lucky.) I talked to my target market occasionally, but didn’t seek their regular input for 2 reasons- 1) I trusted the investors and founder were right in their beliefs that the idea was a winner and 2) I was afraid of the reaction if I discovered we were wrong and proposed changing the concept.

I should have let my market share what they value, even if it differed from what we wanted to create. Sometimes we get caught up in what we’re building, fall in love with it, and fail to realize other people don’t see it the same way. It’s like parents with ugly babies (hey, there ARE ugly babies) that filter out all negative comments because they’re so in love with what they created. Trendi was, in some ways, my ugly baby.

Launching a product your market is begging to use, even with a few rough edges, will have more success than a fully developed site that doesn’t add any value. Plus, you’ll tie your market emotionally to the product. They feel invested and valued and voila- you have your first product evangelists. Furthermore, their input is the ammunition needed when confronting a team, investors, or a board about why a major change needs to take place.

Keep the focus simple and narrow.

Once you know what your audience values, keep your focus only on the features you need. Trendi started out (on paper) as a simple 8-page design. We quickly escalated the site to include a robust back end, picture management system, full social network, etc.

Extra features added time to our launch, increased the burn rate and made the user experience…fragmented. We assumed the users would like what we built only to find out they didn’t like or use all the features and it was difficult for them to figure out the ‘point’ of the site when they arrived.

We over-built Trendi for one main reason: We didn’t have a plan.

Sure, we had some general milestones, but we didn’t have an actionable, communicated business plan. When there is no plan, startup employees turn into hormonal 13 year olds with severe ADD. Anything catches their attention and can change the intended course of action. What are the competitors doing? Why don’t we have this cool feature? Let’s make it pink! No grey! We need a YouTube video STAT! (Get the idea?)

People often ask where our board was during this process and I’m embarrassed to say we didn’t have a formal board. We had our investors who would give us time when they could and we had some friends we would call on informally…but no board to help us keep focus.

Don’t do it just because all the cool kids are doing it.

There were an onslaught of “social shopping” sites in 2006 and early 2007. We jumped onto that trend and while it’s important to know the trends and competitors, it’s more important to figure out what your substantive differentiation is, how that difference adds value and how to make money because of it.

This is a mistake businesses and people make all the time- doing something because everyone else is doing it. Why do we feel more comfortable when we’re doing what everyone else is doing?

I now know questioning the trends and value proposition needs to be done regularly- at least monthly- to ensure the choices made are in the best interest of the company.

Hire only when it’s absolutely needed.

Everyone should be fully utilized before anyone else is hired and increasing the number of employees doesn’t always speed up the launch. For a company like Trendi, we probably only needed a CEO, two developers, and a designer. Ideally the CEO would have been someone who deeply understood the target market, could raise money, inspire the team, and was a stellar marketer, writer or able to contribute another key skill.

Instead, we were almost a year into the project and 15 employees deep before our Angel (who owned the majority of Trendi at that point) stepped in and made a drastic change that involved laying off most of the employees.

Yowza. Hard lesson learned. The team stayed lean and more productive after that.

If it won’t matter in 3 months, don’t spend too much time on it.

We could spend a whole day talking about how our rating system would look or a week bantering back and forth about a press release. I should have asked myself – will this matter in 3 months? If it won’t matter then, why spend too much time on it now? Time is a precious commodity in a startup and should be spent on what matters the most- quickly building a product your customers love.

——-

Funny how our resumes show our successes and we take full credit, yet we leave off the failures and if they come up, we blame others. I wish I could blame Trendi’s failure on other people and circumstances, but I can’t. No startup has it perfect- we all deal with difficult employees, investors and economic strains. I have to accept that as a company we made mistakes, but I also have to look back and accept my personal contribution to those mistakes.

Accepting the personal mistakes hurt my ego. I screwed up and it made me question my ability to lead others, my knowledge as a marketer and my future ability to start another business. But somewhere in facing my failure and accepting these mistakes, I was able to learn how I can be a better leader, new things I can try as a marketer, and that I do have the strength to try again.

I always hope for success and aim high, but I now face failure with a humility and thankfulness I didn’t have before. Ignoring failure only hurts you later- you can stuff it away and try to pretend it didn’t happen, but it’ll bite you in the butt at some point. I know that if I face failure as a teacher (a harsh one, but still a teacher) I’ll become stronger and smarter.

I like tea, Thai food and good happy hours. If you want to join me in Seattle for any of these, email me at jennymhall@gmail.com.

Guest post coming Monday

March 13, 2009

I wanted to let you know that OpenAmbition will be showcasing its first guest post, from Jenny Hall, former CEO of Trendi.com, which was a social networking destination focused on young women’s fashion that was shut down in October of 2008.  Jenny will be sharing what she learned as a first-time CEO through the success and eventual failure of Trendi.

I met Jenny the first time a little over a year ago, when she was trying to raise a Series A financing for Trendi, and for  reasons I explained to her, my partners and I were not able to fund her company.  Jenny touches on a few of the reasons in her post on Monday, but in many respects, what she describes are what many entrepreneurs wrestle with in an emerging but crowded market, where so much is learned in real-time. 

Like with many of the entrepreneurs I am fortunate enough to encounter, she and I have kept in touch, and when she stopped by my office a few weeks ago to tell me about her next startup idea, the subject of Trendi of course came up.  Jenny talked me through some of what she had learned, and how valuable the failure of Trendi had been for her personally (but not painless for her, for her employees, or for her investors). 

When we moved on to discussing her next startup idea, it was inspiring to see how much was informed by what she had learned through Trendi’s failure, how she had embraced what many would have tried to forget or move on from.  And so it seemed like she had a story to tell that the followers of this blog could relate to, find interesting, and hopefully find some meaning in too.

I hope you all enjoy it, look for her on Monday.

Peripateia and the value of getting it wrong

March 9, 2009

One of my kids favorite TV shows is “Dirty Jobs”, and I have to say that what I’ve seen of it, I have liked, because the host Mike Rowe comes across as genuine and inquisitive.  He’s there to understand, not to judge.  That alone is a wonderful set of values for children to see and explore, regardless of medium.

So, when a friend forwarded a link to Mike Rowe’s TED talk  (embedded below) on the merits of hard work, my intellectual curiosity was high.  His job is to question assumptions and to get all of us to understand the real, human aspects of jobs that other people are unaware of or assume just get done. 

He talks about how he’s “gotten it wrong” a lot, but that getting it wrong informs the essence of what he does and how he does it.  He shares the meaningful failure he encounters as an apprentice on a sheep ranch where it’s his job to castrate the lambs. 

He does his research ahead of time and determines the “humane” way to perform said castrations (with a rubber band).  Then he gets to the ranch, and finds the castration performed there is quite different (with a knife, and more); on the surface a more grisly method than he or we could have imagined.  Let’s just say that this would make killing an actual chicken seem simple and an easy choice.

But in the process of telling the story he introduces the concept of peripateia – the sudden or unexpected reversal of circumstances or situation (remembering it from his days studying Greek classics).  What a wonderful way of describing meaningful failure. 

Mike’s castration dilemma is so clearly framed, his assumptions apparent (“the ‘humane’ way is the right way”) and then, through first-hand experience, not only questions that assumption, he casts it aside when he realizes the definition of “humane” needs to be questioned. 

He describes in twenty minutes what some entrepreneurs I know have taken years to internalize, and he draws on some key themes I’ve explored:

  • Getting it wrong is something you need to embrace, it’s what enables you to both perform better and to comprehend your purpose and goals more insightfully.  It’s meaningful failure from another point of view.
  • You need to know when to stop what you’re doing, and question your core assumptions.  This is hard, as I’ve mentioned in previous posts.  When he stops what he’s doing, he demonstrates incredible integrity and purposefulness.
  • Facing up to the unfamiliar, the unpleasant, is precisely what presents you with the opportunity for discovery and learning, and improving the quality of your results.  This is a benefit of chicken-killing I hadn’t thought about.

But the impact of Mike Rowe’s honesty doesn’t stop there. 

He has a transparent methodology (no takes, no scripts, it’s all real) that underpins the credibility of his “product”.  What I loved about this anecdote is that he even had to question that foundational element of his show; he had to stop the filming because his core assumptions about the subject matter were so precarious.   That takes experience and a confidence in your process and values.  He didn’t rationalize, he didn’t talk about the cost of stopping production, he just did it because he knew he needed to.

Back to peripateia.  That doesn’t exactly roll off the tongue, but what an elegant term to describe how you bring meaning to failure, from getting it wrong. and finding meaning from the doing.  I want Mike Rowe on the board of the next company I fund too.

Finding the chicken killers – part two

March 2, 2009

I got a lot of positive feedback and comments on Finding the Chicken Killers, where I explained what the concept of a chicken-killer was but stopped short of providing an example of one.  Let me tell you about someone who was on my marketing team at Vivo.

[This is a longer post than usual; I hope you find it worth it!]

Ann-Marie was responsible for our online marketing, our website marketing, and our demos at Vivo.  She grew up in a large Italian-American family outside Boston; while she was polite and well spoken, she had a nice independent streak.

The situation was this.  We were now 18 months into the turn-around of the company, marketing our internet video product VivoActive.  We’d become the market leader, but internet video was still small compared to internet audio, and RealNetworks was the big gorilla out there.  Oh, and Microsoft was trying to muscle into the market; they’d recently licensed Real’s product and were giving it away for free (but not really marketing it).  How’s that for being neighborly?

We’d aligned ourselves with Microsoft and could create internet video in their format.  VivoActive together with Microsoft’s server made a complete solution, and we had their marketing and sales teams promoting it to their customers. The plan of course was to get Microsoft to buy us.

The bad news was we were running out of cash (we had about six months left), and we needed to sell the company – remember, we were on a Series D financing.  There was no appetite for a Series E.

So, the CEO, my BusDev director, and I got on a plane and went to Redmond to try and move/force the conversation along, but all we got was a tepid commitment to consider an investment.

We came back from that meeting frustrated and depressed.  The three of us were in our conference room, trying to figure out what to do.  It was almost as if a literal light bulb went off when one of us said “Companies buy their enemies to take them off the market… who are we an enemy of?”

RealNetworks.

Holy cow.  RealNetworks.  Were so aligned with Microsoft; we could be a big threat to RealNetworks.  We had at best an arms-length relationship with them (meaning relations were generally frosty).  How could we get them to feel threatened, really threatened, very quickly?

So, I suggested “What if we let all the RealNetworks customers know they could replace the server they bought from Real with the free one from Microsoft?  All they’d need to do is pay us $500 for VivoActive.”  Hmmm… replace your $50,000 RealServer with a $500 alternative.  That sounded workable.

But how to pull this off?  We needed to quickly find out who was using RealServers and then somehow contact enough of them to make this a credible threat.  I got my team together, and Ann-Marie was the first one to come up with an idea.  “We can use Wired’s HotBot search engine to find web pages with the .ram file the RealServer embeds on pages with the media file, and then find out who the company is that owns those pages.  We can look up who the exec team is at the company and send an email offer to them.”  Great idea, but a lot of work.  She agreed to take the lead on pulling this all together.

Working backward from our cash-out date, we’d need to get this done within the next few weeks.  Otherwise, we’d run out of money in the middle of the negotiations.

Ann-Marie showed up at the next war-room meeting and said she’d gone through the process a few times; it was working, but it was going real slowly.  I suggested she have our receptionist, Amy, help her out.  Away she went.

The next day Ann-Marie came back, deflated.  She and Amy had only been able to build a database of about 50 customers.  This was going to take too long.  More brainstorming.  Ann-Marie offered to see if some of the developers could be pulled off their projects to lend a hand.

The next day everyone was looking haggard and tired.  Ann-Marie showed up, looking worse than any of us. “I was up most of last night.  I realized we’re never going to get this done on time, even with the developers.”

What?

Then she said “But I realized we could do this differently.  I wrote an automated script that queried HotBot and wrote the results into a log file, and then I wrote a script to filter out the domain name of the page where the content was hosted.  I wrote another script to take that domain and query the “whois” database, and found out who the system administrator of the site was, and then put the email address and wrote it into another log file.”  The system administrator was a long way from the guy who paid for the RealServer, but it was close enough.

“It’s working really well; I’m up to about 700 names so far, and should be up to about 2,000 by tomorrow.”

Around the table, jaws were bouncing off the floor.  Ann-Marie hadn’t just killed the chicken, she’d plucked it, dressed it, and had it in the oven, roasting.

We got cracking. It was like a commando movie.  We quickly established a launch date for the emails.  Everyone had their task and took off.  I finished off the copy and reviewed the design of the email.  My busdev director made 1000% certain we had the license agreement in place.

Two days later, we were ready to go.  We briefed the CEO and the rest of the exec team on the plan.  Ann-Marie wrote a script (her new core competency) to send the emails out at midnight.

The next morning we came in, eager to see the results.  By mid-morning we had lots and lots of irate emails from system administrators and, as a result of the system administrators forwarding them, a good portion of similar emails from business execs at companies who were loyal to Real.  Irate was good.  Especially when many of the forwarded emails also copied the account manager at Real or even Rob Glaser, Real’s hyper competive CEO.

Lots of tension; everyone ate their lunches at their desks.  A little after 1pm, our CEO came walking down the hallway, a huge, huge grin on his face.

“Rob Glaser just called.  They want to talk about buying us.  I’m heading out to Seattle, tonight.”

I kid you not, it unfolded that cleanly.  A little over twelve hours after sending those emails.

By the time the acquisition was complete, our CEO was neck deep in chickens, killed.  But Ann-Marie was the one who so matter-of-factly and so fearlessly got that first chicken out of the way, and made it all possible.

Finding the chicken killers

February 24, 2009

In early 1996 I was contemplating my next career move, and was taking a serious look at Vivo Software, who had developed the industry’s first software-only desktop video conferencing system.  It was four years old, and had gone through three rounds of financing from some of silicon valley’s premiere VCs.  But what they’d learned was no one really needed desktop videoconferencing back then (ie they were generating no revenue). 

I liked the team a lot, they were being led by an experienced “CEO for hire” who was a well known entity in the venture capital community.  He’d been brought on board along with a new round of financing (Series D!) to take the company in a different direction – to pivot the technology to internet video.  He wanted to know if I would come on as VP of Marketing.  After some serious investigation, I took the plunge.

But the company had been working 80+ hours a week, for four years, and had heard every “success is just around the corner” story under the sun.  And here we were, needing to get them excited about success being just around the corner, again. 

The first day, the CEO and I were in a conference room talking through the plan to get the company going again, and needed to quickly sort out who was up to the task.  He grew up in Texas, and could get to the point with charm and a flair for language that was disarming. 

He looked at me and said “Pete, we need to figure out who the chicken killers are here”. 

“Huh?”  is what I thought, and said with the expression on my face. 

I asked him what he meant.  He said something very simple: “everyone likes to eat chicken, but when most folks want it, they buy it in the supermarket wrapped in plastic.  We need to find the folks who will go out back and kill the chicken themselves because they want it that badly.”

Then I smiled and nodded in acknowledgment.

What he meant was we needed the people who will do the dirty, thankless work, the unpleasant unseen tasks, stuff that most people assume someone else will do for them.  It’s the person who you explain something to, they understand it, and only come back to tell you they it got done.  And they did it differently than they’d planned or expected, dealt with broken commitments, maybe having to do someone else’s job.  They just got it done. 

There were going to be a lot of difficult, unpleasant tasks if we were going to take this embryonic internet video technology and make something of it.  It gave me a new lens to see my team with; I had two in my marketing team, and we had two in the developer group.  It mattered a lot as we restarted the company.

And we did make something of it.  24 months later, we sold the company to RealNetworks (by the time the lock-up expired, the value of our stock increased 10x).  Success really ended up being around that corner, and the chicken killers got us there.

It’s crucial to know who these people are where you work, and in your life, if you’re going to get the big meaningful things done.  I think about this a lot.

My wife is a chicken killer of the highest order.  She can cause incredible, positive structural shifts to be made in the behavior of an organization, can build consensus spanning government and private interests, and can manage complex processes with precision and ease.  She does this by making sure that everything and everyone has been considered, including the very unpleasant, messy things that no one else thinks of or quietly tries to avoid.

At her 40th birthday party, in a restaurant filled with her friends from all across the country, I made a toast to her.  I’d worked with a friend who was a talented artist, and had transformed what I had written into a folding hand-printed and hand-colored card.  At each page, there was a thought or reflection.  Everyone had a copy to follow along with. 

When I came to “She’s a chicken killer – doing the unpleasant, the tedious.  The things that others assume just happen”  I got that same look from the audience that I gave the CEO at Vivo. 

Then I explained what a chicken killer was, and across the room appeared the smiles, and then nods of acknowledgment.