Monday 31 December 2012

Something for us all on New Years Eve - some heavy reading :)

Human Capacities in the Integral Age
How Value Systems Shape Organizational Productivity,
National Prosperity and Global Transformation

This is all by Don Edward Beck, Ph. D.who could be said to be continuing the great work of the legend who was and is Erich Fromm.


"The focus on the role of productivity in enhancing competitiveness, while generating wealth and cultural well-being, has shifted over time from the micro (personal, team and "circles") to the meso (organizational design and performance) and now the macro (large scale and complex systems). Likewise, the essential thinking around productivity matters has emerged through systemic, strategic, humanistic and now integral patterns and organizing paradigms.

The "profound knowledge" as described by Dr. Edward Deming is just now becoming clear to many who applied only surface-level and tentative versions of his massive work. We now recognize that micro-scale solutions depend heavily on both meso-scale and macro-scale insights and that all three must be meshed in the whole-scale application.

This presentation will introduce the concept of Spiral Dynamics, a new, evolutionary framework that describes whole-systems thinking, details how value systems emerge in societies, and maps out a program for raising human capacities to deal with 21st Century complexities. The session will introduce the notion of Memetics, the scientific study of "DNA-like" codes and patterns that lie at the core of companies, cultures and countries. It will describe the role of Vital Signs Monitors in profiling human groupings, and a series of design formulas in crafting natural systems that align focus, function, form, fit, flow and future. Finally, it will demonstrate how to synchronize the spiral of technological complexity, business systems sophistication, and levels of human development.

THE AGE OF FRAGMENTATION

Never before has the planet earth carried such a rich tapestry of human differences in the form of individuals and groups. The end of the Cold War brought the thawing of the bi-polar ice sheet that covered the entire planet as the deep ethnic cores began to bubble and boil once again. Decades of deconstructionism and egalitarianism in academic and popular cultural circles released the bent-up entities and interests that had been subdued by European-Western hierarchies of power and control. The microchip places an immense amount of influence in the choice making of single individuals. DNA analyses now make possible the specific identity of every person on the planet. Mass customization efforts are able to target each person, and even specify names on the inside of weekly magazines. It is as if the entire psychological history of our species from Day One is being replayed in real time and carried live on CNN. What an amazing time!

Likewise, we have been witnessing a significant amount of fragmentation in the work place and around issues germane to productivity. Our work force, in most environments, is much more diverse than before. The shift toward a global view has, likewise, introduced more complexity, not just in terms of different cultures, but also in the form of a myriad of value systems that work side-by-side or, within a whole constellation of teams and alliances. Yet, many of our approaches to productivity still tend to be monolithic in design and applied like a generic "cash wash" over people and work units that are spreading apart as if they had been purloined into space a Big Bang

SIX BLIND MEN AND THE ELEPHANT

Most people know the story of the "Six Blind Men and the Elephant." One discovered the tail, another the trunk, while the others felt the leg, side, tusk, and ear. Each was totally convinced he had discovered the "truth" based on the direct experience. Of course, each observer was "right" about the elephant, but only about a part; none was able to sense the whole. This can also be said about the various political, economic, religious, educational, child-rearing, and technological theories of our own day. This also includes the various listings of worldviews or Weltanschauungen, or the numerous psychological packages, leadership initiatives, or managerial mandates that continue to be popular, or have been discarded in societal dust bins. The various and often heated debates heard at the United Nations, or in national assembles, senates, and parliaments, will, likewise, reflect these different views of "the elephant." Rather than continue to pit the vast array of differences against one another in an adversarial manner, or suffer the consequences when the conflicts surface in the form of belligerence or warfare, might it not be useful to find a way to construct a synthesis that can explain why each emerged, where it is useful, and how it can contribute to the total Global Mesh?

Which of these views of the elephant-world best describe you?

The World is. . .*

beige a natural milieu where humans rely on instincts to stay alive
purple a magical place alive with spirit beings and mystical signs
red a jungle where the strongest and most cunning survive
blue an ordered existence under the control of the ultimate truth
orange a market place full of possibilities and opportunities
green a human habitat in which we share life's experiences
yellow a chaotic organism forged by differences and change
turquoise an elegantly balanced system of interlocking-forces

*Question from The Values Test, NVC

(For me I think i am the two of my most favourite colours - strange but true - both cyan and orange... whether i should be is another question entirely...)

This search for the cohesive elements that can hold so many fragmented parts together in a new, 21st Century alignment, and create the methodology and mechanisms for the continuation and enhancement of all human life on the planet as well as in corporate and work environments, will require an understanding of three essential components:

The Evolution of Value Systems.

We will introduce here a new framework called Spiral Dynamics, a bio-psycho- social-spiritual conceptual system that describes how and when worldviews emerge, and how they form themselves into spirals of complexity. Each newly awakened Value System crafts its own unique work attitudes, organizational designs and specific perspectives on issues around productivity improvement

Historical Approaches to Productivity.

Because Life Conditions change, new innovations are introduced into the workplace, and people themselves emerge into different priority "bottom-lines," we must rethink the whole matter of productivity itself, and what it will take to generate the high levels of behavior necessary to maintain the quality of our lives. We will track the shifts in thinking about productivity through a series of Value Systems, with an additional recognition that our own efforts have emerged through micro, meso, and now macro applications.


Productivity in the Integral Age.

If, indeed, we are dealing with new levels of complexity and fragmentation, how should we conceptualize the role of productivity in enriching and enhancing the work place, or in educational systems, or in cultural and social domains, so that we meet the challenges that confront us in this newly emerging Integral Age?

THE EVOLUTION OF VALUE SYSTEMS: SPIRAL DYNAMICS

Spiral Dynamics is based on the seminal work of the late Professor Clare W. Graves, Union College, New York. He described what he called "Levels of Psychological Existence" as an emerging pattern and priority of worldviews, value systems, and complex adaptive intelligences that arise in response to Life Conditions. Thus, human nature is not finite. We are not frozen into types or traits. Cultures are not static entities, forever trapped in Flatland. As Graves explained it:

Briefly, what I am proposing is that the psychology of the mature human being is an unfolding, emergent, oscillating, spiraling process marked by progressive subordination of older, lower- order behavior systems to newer, higher-order systems as man's existential problems change.

The human Spiral, then, consists of a coiled string of worldviews, each the product of its times and conditions. Yet, when a new worldview emerges, the older systems do not disappear. Rather, they remain subsumed in the total flow and not only add texture to the more complex ways of living, but remain "on call" in case the problems that awakened them to service reappear. So, there are systems within us, miniature worldviews each of which is calibrated for different problems of existence.

Each new worldview is born out of chaos, in a nonlinear fashion, so there is no straight arrow of time back into history. Each worldview is a platform with its own unique paradigm and instructional codes for organizing society. Like a DNA script, the unique adaptive themes at each level will express themselves in terms of life-styles, economic, political, religious, and educational systems, and views of sex, marriage, working, the environment, and sports.

In our recent work we have fused the Graves Technology with the fledging science of memetics, noting that each of the worldviews is in fact a "valuesMEME", a coding mechanism that inculcates every aspect of society.

Graves work identified eight distinct worldviews or vMEMES, with the ninth on the horizon. Yet, all of the previously awakened systems still exist. These deep level tectonic-like psychological plates create surface level tensions as we ratchet through time.

QUICK SUMMARY STATEMENT OF WORLDVIEW (vMEME) CODES

THE LIVING STRATA IN OUR PSYCHO-CULTURAL ARCHEOLOGY

Level 8 Turquoise WholeView Holistic
collective individualism; cosmic spirituality; earth changes

Level 7 yellow FlexFlow Ecological
natural systems; self-principle; multiple realities; knowledge

Level 6 Green HumanBond Consensus
egalitarian; feelings; authentic; sharing; caring; community

Level 5 Orange StriveDrive Strategic
materialistic; consumerism; success; image; status; growth

Level 4 Blue TruthForce Authority
meaning; discipline; traditions; morality; rules; lives for later

Level 3 Red PowerGods Egocentric
gratification; glitz; conquest; action; impulsive; lives for now

Level 2 Purple KinSpirits Animistic
rites; rituals; taboos; super- stitions; tribes; folk ways & lore

Level 1 Beige SurvivalSense Instinctive
food; water; procreation; warmth; protection; stays alive

Here's the key idea. Different societies, cultures and subcultures, as well as entire nations are at different levels of psycho-cultural emergence, as displayed within these evolutionary levels of complexity. They have different centers of gravity. The previously awakened levels do not disappear. Rather, they stay active within the worldview stacks, thus impacting the nature and form of the more complex systems. Like the Russian dolls, there are systems within systems within systems. So, many of the same issues we confront on the West Bank (Red to Blue) can be found in South Central Los Angeles. One can experience the animistic (Purple) worldview on Bourbon Street as well as in Zaire. Matters brought before city council in Minneapolis (Orange to Green to Yellow) are not unlike the debates in front of governing bodies in the Netherlands. Countries and cultures are mosaics of multiple vMEME codes.

Third World societies are dealing, for the most part, with issues within the Level 1 through Level 3 zone, thus higher rates of violence and poverty. Staying alive, finding safety, and dealing with feudal age conditions matter most.

Second World societies are characterized by authoritarian (Blue) one-party states, whether from the right or the left. Makes no difference.

So called First World nations and groupings have achieved high levels of affluence, with lower birth rates, and more expansive use of technology. While centered in the strategic, free-market driven, and individual liberty focused perspective -- all traits of the Level 5 (Orange) worldview -- new vMEMETICS (Green, Yellow, and Turquoise) are emerging in the "post-modern" age.

Yet, we have no language for anything beyond First World, believing that is the final state, the "end of history." Further, there is a serious question as to whether the billions of people who are now exiting Second and Third World life styles can anticipate the same level of affluence as they see on First World (Orange) television screens. Now that expectations have been raised by visiting "Paree," how do we expect to "keep them down on the farm?"

Different worldviews or vMEMES fight wars or engage in conflict but for different reasons.

Beige Survival Clans
to keep a place in the survival niche, as in the movie The Quest for Fire

Purple Ethnic Tribes
to protect the myths, ancestral traditions, rights of kinship, and sacred places.

Red Feudal Empires
to dominate, gain the spoils, and earn the right to rape, pillage, and plunder.

Blue Ancient Nations
to protect borders, homelands, hearth, preserve way of life, defend "holy" cause.

Orange Corporate States
to advance economic spheres of influence, or access to raw materials and markets.

Green Value Communities
to punish those who commit "crimes against humanity" and protect the victims.

Many people who knew both Edward Deming and Clare W. Graves have remarked that the two men had a great deal in common, both in terms of their respective worldviews and their approaches to social change and transformation.

Deming spoke of "Profound Knowledge" while Graves' described what he called "The emergent, cyclical, double helix model of adult bio-psycho-social development." The two men were of similar age, stature, temperament, and style. Graves had the greatest respect for Deming's work and it is unfortunate that they never met. They were both "giants" in their own respective domains.

HISTORICAL APPROACHES TO PRODUCTIVITY

If one were to engage some of the sophisticated data-mining technology with a colony of Web Crawlers to detect every use of the term "productivity" over the last fifty years, there would be a clear pattern to the clusters they would reveal.

Productivity itself has gone through its very own evolutionary process as it passes through the micro, meso, and macro stages. One can also see how the various initiatives have moved along the vMemetic trajectory as we have sought, in each of the Value Systems, to construct what we thought at the time would be the major advance in job performance, efficiency and effectiveness, and the overall quality of our respective work styles.

BLUE-ZONE PRODUCTIVITY: DOING THINGS THE RIGHT WAY

Some of the initial attempts at productivity improvement focused specifically on logical thinking, statistical measurement, connecting-the-dots, and enhancing systems as they existed at the time. These efforts stayed within job functions, organizational groupings, and served to plan the work and work the plans within the established set of givens, authority, and responsibility. BLUE ZONE PRODUCTIVITY initiatives spawned such innovations as the early version of Quality Circles, Total Product Quality (TPG) projects, and other efforts. This emphasis also resulted in the creative contributions of Larry Miles at General Electric and what became known as Value Engineering.

VE practitioners were asked to scan and monitor large capital contracts that had already been finalized to search for ways to cut costs, avoid duplication, and elaborate on designs which had already been set in concrete. It is ironic that the very first psychologist who Larry Miles sought out for advice was Professor Clare W. Graves, who was on the Union College faculty just a few miles from GE's headquarters

ORANGE ZONE PRODUCTIVITY: STRATEGY AND BOTTOM-LINES

As BLUE ZONE PRODUCTIVITY efforts matured, it occurred to many in the field that something was indeed missing. All of the intelligent and highly motivated efforts to make substantial improvements in the quality and flow of work were blocked by the nature of the organization itself. The Quality Circles groups lacked the mandate to cross over functional, departmental, and even geographic lines. Those people who participated were often rewarded by a pat on the back but little more. The improvements they designed and implemented benefited the pay-checks of top level executives but not their own. They were asked, even commanded, to "work harder and smarter," but soon discovered they would not benefit from the fruits of their labors.

ORANGE ZONE PRODUCTIVITY shifted in the direction of strategy with the massive re-engineering exercises, the entry of microchip technology that made possible instant communication across all of the barriers, and the onset of interest in aligning the entire enterprise to the "bottom-lines." Governmental entities shifted from seniority-based compensation to a preoccupation with merit awards and putting professions into competitive postures. The idea, of course, was that these innovations would enhance the capacity to squeeze costs, fine-tune efforts, and see to it that every expenditure of funds, every effort on the part of everybody, would all translated in one way or another to "the bottom-line." VE moved to what was called Value Management as scapulae were put to costs at the front end of contracts rather than be locked into the big decisions that impacted, often in a negative way, the little decisions. Unless the large flywheels were aligned to "strategy," the smaller flywheels would continue to spin whether they produced positive results or not.

GREEN ZONE PRODUCTIVITY: SENSITIVITY TO PEOPLE

Michael Hammer and his colleagues who were well known for the entire re-engineering movement, had to make the major confession after "down-sizing," brutalizing, and ripping apart many traditional systems, that they had totally ignored the importance of people in their activities. Big surprise. Those with the Orange vMeme virus in their minds see nothing beyond profit, perks, and privilege. It became apparent to many that people, indeed, were critical to any long-term and effective effort that could sustain itself over time. A great amount of historical knowledge was lost in companies because of both the imposition of meritocracies and the assumption that systems – business, technological, and strategic – would, by themselves, produce the results that everybody designed. They did not. They could not.

At this stage a large segment of productivity thinking became focused on people – their competencies, feelings, experiences, Humanistic work site needs, and even personal preferences with regard to such "fringe benefits" as athletic facilities, nurseries for children, partner privileges, and similar sensitivities. Without question the enterprise became a happier and healthier place as diversity programs stressed the value in human differences, and community-based projects afforded an opportunity for everybody to participate in social responsibility schemes.

We also witnessed, in the GREEN ZONE, the emergence of self-managed work teams, fully capable of functioning virtually on their own. Trust-building exercises were introduced. Off-site meetings by the groups were encouraged. Expansive career development tracks were funded. Barriers in the organizational structure were lowered as rank system were discouraged, both in external displays and in personal relationships. Everybody was on a first name basis.

PRODUCTIVITY IN THE INTEGRAL AGE

The celebrated and romantic Age of Aquarius ended forever with the crash of the World Trade Center towers in New York City on September 11, 2001. The Age of Fragmentation was at its high water mark, its zenith following the end of the Cold War. Many of these identical issues are, likewise, appearing in corporate suites, on shop floors, in trading centers, and in business schools – from Harvard, Stanford, and the London Business School to smaller educational/training programs literally around the world. Witness, now, the rise of The Integral Age.

The intent here will be to discuss the ramifications of this new epoch to the general area of productivity, with a focus on redesign rather than fine-tuning, on transformation rather than reformation or renewal, and on open, flow-state dynamical systems rather than closed-in, boxed-in, and rigid, final-state models and methodologies. Here are several of the basic assumptions and processes that implement the Integral perspective.

THE DESIGN OF NATURAL SYSTEMS

Actually, the Integral Age is based on the 7th and 8th Level Value Systems, the YELLOW and TURQUOISE ZONES in terms of the Spiral Dynamics' conceptual system. The approaches to productivity in these zones tend to favor the macro or whole-systems scale perspectives. If these are "set right" at the very beginning, many of the micro and meso issues and concerns will naturally follow suit. This will of necessity unblock the constraints that have prevented the productivity measures in the BLUE, ORANGE, and GREEN domains from actually producing the results they desired. I worked for a number of years with Middelburg Steel & Alloys company in the Eastern Transvaal in South Africa. This heavy-industry organization was light years ahead of others in that productivity efforts, and even safety-measures, were built into the design of the total system rather than imposed as separate items over the entire structure, operating codes, and output requirements. Everything connected to everything else. All the decision-makers were involved in all of the developmental programs. The requirements for productivity improvement, safety regulation, and even diversity development were featured on the evaluation forms for everybody. The company was saturated with innovative versions of Value Engineering/Value Management, and it extended from the executive suite to the shop floor, and across all functions. This company and its executives and staff played a major and defining role in the entire South African transformation out of apartheid, as these principles were applied in the Middelburg community and even into the National Peace Accord.

Natural Systems Designs have a number of distinguishing characteristics:

They identify the underlying vMEME codes operating in the overall culture, the critical priority sets in key decision-structures and which are essential in different work flows, as well as the overarching set-points, flywheels, or deep cultural assumptions that macromanage the whole. This is all mapped out as underground currents on which the enterprise must be constructed.

They skillfully align the core elements – focus, function, form, fit, flow, fulfillment and future – in the design of the features that, when properly set in motion, generate high levels of productivity while, in addition, meeting the four essential "bottom-lines" that every enterprise should now pursue – purpose, profit, people and planet.

They design the appropriate levels in, as reflected in the three Spirals: Degrees of Complexity in the Technology Spiral; Levels of Sophistication in the Business/Systems Spiral; and Levels of Emergence in the Individual and Cultural Spiral. Unless there is synchronization in the three Spirals, tension and stress will result. If the technology is too complicated for the business systems to handle, or the business (motivation, communication, compensation, information, etc) is either too complex or too simplistic for the work force, there is serious trouble ahead. There must be balance across all three Spirals, so that the "well-oiled machine" or the "finely-tuned" Flow-State can function with minimal energy lost and maximum productivity.

They focus more on the codes, maps, equations, and scenarios than on prescriptions, patterns, and policies. For example, the following equation is repeated over and over again:

How should WHO lead/manage/motivate/inspire WHOM to do WHAT, with WHICH people living WHERE?

4Q/8L – HITTING ON ALL CYLINDERS – HOLISM IN PRACTICE

Ken Wilber has created a powerful, imaginative, and practical template to overlay on any situation to identify the specific needs and capacities of individuals and groups, and calibrate the precise developmental or growth-related packages that fit each unique situation.

The "All Levels" piece of his framework can be explained in terms of the eight vMEME or worldview layers and levels of complexity. The "All Quadrants" component consists of:

IT - Individual Brain & Organism.
I - Individual Self & Consciousness
ITS - Collective Social System and Environment
WE - Collective Culture and WorldView.

Efforts which select a single Q, or operate on a mismatched L, could make things worse. Large scale efforts, such as cultural upliftment, must be All Q and All L. The same holds for developmental schemes in organizations. Too often we rely on a single Quadrant, such as the Upper Left, in enhancing people's personal insights, skills and states of mind – but then send them back to their same former Lower Left webs of culture that are hostile to these new perspectives and behaviors. Or, we place people in jobs and functions but fail to align the compensation or management systems (Lower Right) that support the behaviors we expect. No doubt you can offer many examples of this problem.

The design and implementation of successful All Quadrants/All Levels initiatives requires a new generation of decision-making formulas and processes. While each of the vMEMES has evolved its own form of problem resolution, the Yellow-Integral and Turquoise-Holistic worldviews contain the intelligences to macromanage the whole human Spiral.

PRODUCTIVITY IN THE FLOW-STATE (LIFE CYCLES)

Ichak Adizes, in his corporate lifecycle framework, has devised what he calls CAPI – the Coalescing of Authority, Power, and Influence – so that all sit at the same table in sorting out complex issues. (See http://www.adizes.com.)

After studying thousands of companies from all over the world over decades, he has been able to identify the different managerial codes that are operative at different life-cycle stages as the entity deals with its problems of existence. The codes –
P-production, A-administration, E-entrepreneurial and expansionist thinking, and I-integrative – vary at the different stages.

The organization will always have problems; the only question is what kinds of problems will it have, what are their dimensions, and what will be required to handle those specific circumstances.

Huge gaps in productivity occur whenever the entity is out-of-phase with its specific location on the corporate life cycle. Short-term, quick-fix, or cosmetic "solutions" only make things worse.

The entire entity must be involved in creating trust, designing the appropriate structure, finding the right people, and implementing the congruent systems. The Adizes Methodology is, without question, the most powerful framework that I have come across for managing complex business and cultural streams.

VITAL SIGNS MONITORS: SENSING THE PATTERNS AND FLOWS

As humans, we exist in a wash of bacteria, viruses, genes, and memes. All four appear to be impacted by nonlinear events, and possess the capacity to literally re-engineer their respective codes in order to adapt to changing conditions in the milieu.

The Vital Signs Monitor is designed to track the life forces that influence our human experiences. Consider an operations-type room, with floor to ceiling video screens, where the critical indicators are displayed and overlaid on top of each other. Such a Monitor could register the pulse of aggregates of people, both at macro and micro levels, to search for the deepest trends, major vMEME conflicts in the making, serious sink-holes in development projects, and the general health and well-being of global people. This technology could provide globally focused decision-makers with the necessary information to translate into knowledge, then formulate actions.

Such a technology is being developed by John Petersen and his Arlington Institute, located in Arlington, Virginia. The intent of the Vital Signs Monitor, displayed within the Institute's Fusion Center, is to track vMEMETIC flows and Stages of Change within the American society. (See www.arlingtoninstitute.org.)

Likewise, a number of innovative companies are seeing the wisdom of creating their own internal VSM to collect all of the critical indicators, and display them at a single place and time so that everyone can see everything. Conoco, for example, a global energy company, has created what is called Dashboard, a company-wide project and initiative designed to craft such a data clearinghouse that takes and monitors the "pulse" of the company and its external world(s). They may well be writing the textbook for this technology.

Finally, we are now constructing a method for assessing the core Value Systems in entire cultures and societies so that we can detect major tension zones, stress points, and early evidence of major changes on the horizon.

Cometh the Time; Cometh the Thinking. "

Saturday 22 December 2012

Mobile, gaming, education, and augmented reality!

I have been away to Singapore and thinking, talking and meeting people and organizations in there about mobile augmented reality. So interesting to find out that whilst I was there that researchers from the National University of Singapore (NUS) say some students taking part in a trial have shown an improvement in retaining information after playing an iPad-based game.

So mobile, gaming and augmented reality - all my favourite things :)

According to the University, a group of 36 Secondary One students from Outram Secondary School showed a 22 per cent improvement in learning outcomes after the game. Which could be great news for a couple of companies I spoke to last year who wanted to bring in augmented reality to education - where I think it would work as well!

The game, based on a chapter in the Secondary One History syllabus, makes use of augmented reality (AR) to bring history to life for students.

The game, "The Jackson Plan", is named after Sir Stamford Raffles's town planner Lieutenant Philip Jackson.

His plan of the Singapore River in 1822 forms the game's storyline.

Raymond Koh, research designer at Keio-NUS Connective Ubiquitous Technology and Embodiments (CUTE) Center said: "Lieutenant Jackson actually designed a segregation plan for the population of immigrants. And we looked at the sort of activities that these people did at the time to motivate narrative and game structure."

Under the trial, students were shown a fragment of the map of old Boat Quay.

Their task was to find the missing pieces of the map.

"They have to learn to analyse, to organise all the information so that they can find out who is the one who stole the map," said Deidra Wong, social science researcher (education) at NUS.

Along the way, students learn more about history with the help of AR.

"AR is basically representing virtual content in physical spaces. So you can interact with these sort of information in real time," said Mr Koh.

Talks are already underway for a licensing agreement to use "The Jackson Plan" as a supplement for students.

Dr Henry Duh, co-director of Keio-NUS CUTE Center said: "Since the project is quite successful and it proves to be quite effective, we hope we can work with other schools to roll out and deploy such mobile AR education tools and to help the students to learn about their neighbourhoods and engage them in their community."

Designers and researchers at the Keio-NUS CUTE Center took three-and-a-half months to come up with the game. Which doesnt seem like tooo long. Perhaps worth looking into for Great Marketing Works as well as some of our clients as well.

Monday 3 December 2012

Why you should break more rules to succeed

A very very apt blog post for my 100th.

Not only timing wise as I am about to go to Malaysia.

But also because I have realized something after reading it - I am following too many of the rules... I didnt used to - what happened to me?

So Chris Yeh - I am with you.

The Dim Sum Principle: Achieving success by breaking all the rules:


My family was out for dim sum this morning, when I realized that there's a lesson it can teach us.

Dim sum succeeds because it breaks all the rules of a restaurant.

1) Restaurants take reservations. Dim sum is first-come, first-served.

2) Restaurants make their money on dinners. Dim sum is only served for brunch.

3) Restaurants make their money on drinks.
Dim sum restaurants serve free tea, and no one drinks any alcohol.

4) Restaurants provide a menu with prices, and then you order. Dim sum has no menu unless you request it. The food comes to your table on carts, and you generally have no idea how much it costs.

5) Restaurant meals proceed in a fixed order, with salads and appetizers followed by an entree, finished with dessert. Dim sum carts come by independent of course; the first cart you see might be a dessert cart, and you can start with dessert without anyone blinking.

6) Restaurants provide a server who takes orders and brings you all your food. Dim sum restaurants send waves of ladies with carts past your table, and you might never see the same person twice.

The one thing that dim sum restaurants do that is conventional is to serve delicious food.

Your industry has a lot of rules, but there are probably only a few that matter. An airline has to get you to your destination quickly and safely. A bicycle needs to be human-powered, and faster than walking. Beyond that, it's up to your creativity.

Dim sum restaurants show that as long as you follow the few rules that matter, your startup can break all the rest. In fact, it might even set you apart and help drive your business.

Friday 30 November 2012

Stop believing in luck by Shed Simove

This is all taken from his piece in business zone - and as I am a massive fan - I pop it here so I can read it when I am not working.

Right now I am working for Blippar - the mobile augmented reality specialists - which is interesting as they seem to keep on succeeding and succeeding... They / we won another award last night for the ground breaking work with Shortlist magazine.

But that's another story - and one for a client - not for me. So as Shed says he is a "firm believer that in business personal development should be compulsory for everyone. We should all learn how to be become fulfilled, decent members of society and ones that are easily capable of making our dreams come true.

Instead of learning techniques for success, most people grow up with snippets of information gleaned from common knowledge. The problem is that these snippets don’t often deliver the whole truth about the process of how to achieve any goal you might have, and sometimes make it seem like something to avoid.

Here’s one such snippet you’ll most certainly have heard, 'If at first you don't succeed try and try again'. This is wrong, if you keep trying and keep failing then you need to change strategy to have any chance of being successful.

Persistence alone however, is simply not enough. Instead, what you need to do is persist and evolve your approach to success. 'Never giving up' is fine (and necessary), but simply doing the same thing over again may well only deliver the same results. This is why you must frequently change your approach or – even better – try lots of different strategies at the same time. The more opportunities you work on simultaneously the greater chance you have that one will turn into a success – so always try and keep a broad focus.

The successful writer and playwright Samuel Beckett also had his own version of this idea. He said: 'Try Again. Fail again. Fail better'. In saying 'Fail better', Beckett neatly forces your brain to re-understand that failing is something necessary, beneficial and worth striving for. This is one of the single biggest lessons a businessperson must comprehend.

Here's a thought that comforts me when I encounter a setback or challenge (much better words than failure), 'A failure is simply something which tells you that you’re nearer to your goal.' If you fail at something you learn from it and don’t make the same mistake again. You have improved your knowledge and as such, are more likely to become successful in future.

Here's another big tip for success: banish the word 'luck' from your vocabulary. When it comes to success there is no such thing as luck. In fact, the truth of the matter is quite different – and should make you feel incredibly empowered. The fact is that nothing happens without you making it happen.

'Luck' is often used as an excuse by people who don't want to try to attain success or by people who want to give up. These people might say, ‘Other people are far luckier than me’ or ‘My luck has run out and so I can’t reach my goal’. Nonsense! These attitudes are very dangerous because they suggest that your life is controlled by external factors that are uncontrollable by you.

Well I'm here to tell you different: luck is a myth and you can control pretty much everything as a businessman.

Rather than waiting for luck to happen to us, we must realise that we alone are responsible for what happens in our life. The key is to take control and create situations that allow good things (or ‘lucky things’ as some people wrongly call them) to happen.

The concept of being lucky is a falsehood and here is a good example of putting yourself in a position to be lucky.

When I made some of my first gift products, a big firm in the US asked me to develop another item that went on to sell more than the original product I’d sold them. This happened when I released a novelty item called 'The Parent–Child Contract Pad' (a simple notepad that mimics a formal contract for adults and kids to fill in) and the buyers at the gift chain told me that they wanted another item to sit next to the pad on their shelves and have even broader appeal. I quickly suggested an idea to the fantastic partner company I was working with at the time, and we went on to release the ‘Sound Machine’ (a little plastic box that plays sixteen different sounds, from applause to explosions – and even burping). It went on to be a surprise hit around the world.

This may have been a fortunate outcome but, that example of success wasn’t down to luck, it was down to the fact that I’d created a product in the first place that gave me the chance to be lucky in the future. I’d bought a ticket and therefore had given myself the opportunity of winning the raffle."

All wise words - not surprising as Shed Simove is author of Success Or Your Money Back.

Tuesday 27 November 2012

More about Linkedin networking and marketing...

A couple of days ago I was training a company in Linkedin Marketing - I was amazed how many of them were on the platform but not really using it.

The training went well - they understood and went away with a host of tools to use and tips to maximise their time.

I then read this by Bernard Marr - ironically on Linkedin - on Linkedin - so I thought I would pop it here for next time.

As you see, the beauty of all these social media platforms is that you can measure most things very accurately. And therefore give an ROI to training very quickly.

Measuring your success on LinkedIn will help you make sure you get what you want and allows you to track your ROI on your investment in time etc.

There are some easy ‘input’ metrics you can track using your LinkedIn page. You can track things like:


‘Your Network Size’ or ‘Total Connections’
- You can quickly see your number of connections and network size on your home page by clicking the ‘connections’ tab. Growing your network will help you grow your influence and visibility in LinkedIn.
Level of new invitations – counting the amount of new invitations is a good way of tracking that your network is continuing to grow. If you get a good level of new invitation every week then you know that you are growing your influence and potential value from your LinkedIn activities. Again, you can use the LinkedIn system to give you this information by clicking on the ‘Your LinkedIn Statistics’ tab and clicking on the ‘new people’ hyperlink.

LinkedIn Profile Views – another statistic LinkedIn will provide you is the number of people who have accessed your LinkedIn profile in the last week. Keeping an eye on these stats will give you a good idea of your growing LinkedIn presence. If you have up-graded to the premium account you will not only get the number of views but even their names, job titles, and industry – which makes it even more powerful. Even though the above ‘input’ measures will give you some initial insights, their values are limited. Slightly more sophisticated are ‘engagement’ metrics that look at interactions and level of engagement. I suggest you look at measures such as:

Level of Interactions (e.g. likes and comments) on updates – a great way to build a presence of LinkedIn is to write regular up-dates and a test of whether these up-dates are relevant and useful to your community and network is to look at the number of likes you get and the number of comments your posts generate. A nice way to boost your interactions is to join relevant groups on LinkedIn and post questions and comments on discussion threads. Potential employers and business customer will look for influential people in their industry and the level of interactions is a good measure of such influence.

Endorsed skills – on LinkedIn you can list the skills you believe you have. What is powerful is that members of your network can now endorse or ‘confirm’ those skills. This is a powerful way of getting endorsements for your claims and recruiters are paying increasing attention to these endorsed skills. It is therefore a good idea to encourage and remind people in your network to endorse your skills.
Total number of recommendations – an even more powerful way of assessing your influence and level of endorsements from others is the number of recommendations you have.

Other LinkedIn members have the ability to write a recommendation about you. You can also use a function within LinkedIn to asked individuals in your network to recommend you. It is therefore a great idea to get into the routine of asking exiting and past employers, colleagues or customers to write recommendations. Only for the fact that potential future employers or customers will surely take note of any recommendations.

Which is great news as on my Linkedin Page I have lots of recommendations and more endorsements than many of the people I respect in the industry (which makes me wonder a little about the validity of them as a true measure of influence.)

Measures of engagement are more insightful than the simple input measures but even engagement measures should not be confused with ‘outcome’ measures. Outcome measures track the ultimate success of your LinkedIn activities and provide you with the definitive insights of your LinkedIn success. While it is great to grow your network and even better to engage with your contacts, the final goal is to either generate new and better job offers or to generate new business. Unless this is happening, your LinkedIn activities are still questionable. So here are your ultimate LinkedIn success indicators:


Total number of business leads
– If you are on LinkedIn to generate new business then measuring the number (and quality) of leads generated is essential. Simply keep track on how may requests for business you have had and make sure you validate the requests by establishing the value of these request in terms of potential revenue or quality of leads. You don’t want to generate a great number of sub-quality leads or requests for ‘free’ advices. The number of real business leads is a great start but the number of quality and validated business leads is even better.

Number of job offers – if you are on LinkedIn to improve your career and attract new job offers than this is what you should be tracking: How many job offers have you received. However, similarly to the business leads, it is useful to qualify the job offers you are receiving – are they the stepping stone offers you are hoping for or are they sub-quality job offers for you to move sideways?

The above set of ‘input, engagement and outcome’ metrics are a great starting point to better understand the return on investment you are getting from your LinkedIn activities. However, there are other social media indicators such as online share of voice, social networking footprint, or influence measures such as the Klout Score or Peer Index.

Having talked about LinkedIn success measures – I would love for you to engage with me and follow me, maybe endorse my skills, or recommend me, or at least comment on this piece – what are your thoughts? Are there other indicators you use? Please let me know and grow your own influence by commenting and engaging…

Friday 16 November 2012

The 8 habits of extremely successful people ... worth thinking about...

Borrowed off Jeff Haden - great thinking from a great thinker.

Jeff is fortunate to know a number of remarkably successful people.

So here he describes how these people share a number of habits: These are the 8.

1. They don't create back-up plans.

Back-up plans can help you sleep easier at night. Back-up plans can also create an easy out when times get tough.

You'll work a lot harder and a lot longer if your primary plan simply has to work because there is no other option. Total commitment--without a safety net--will spur you to work harder than you ever imagined possible.

If somehow the worst does happen (and the "worst" is never as bad as you think) trust that you will find a way to rebound. As long as you keep working hard and keep learning from your mistakes, you always will.

2. They do the work...

You can be good with a little effort. You can be really good with a little more effort.

But you can't be great--at anything--unless you put in an incredible amount of focused effort.

Scratch the surface of any person with rare skills and you'll find a person who has put thousands of hours of effort into developing those skills.

There are no shortcuts. There are no overnight successes. Everyone has heard about the 10,000 hours principle but no one follows it... except remarkably successful people.

So start doing the work now. Time is wasting.

3. ...and they work a lot more.

Forget the Sheryl Sandberg "I leave every day at 5:30" stories. I'm sure she does. But she's not you.

Every extremely successful entrepreneur I know (personally) works more hours than the average person--a lot more. They have long lists of things they want to get done. So they have to put in lots of time.

Better yet, they want to put in lots of time.

If you don't embrace a workload others would consider crazy then your goal doesn't mean that much to you--or it's not particularly difficult to achieve. Either way you won't be remarkably successful.

4. They avoid the crowds.

Conventional wisdom yields conventional results. Joining the crowd--no matter how trendy the crowd or "hot" the opportunity--is a recipe for mediocrity.

Remarkably successful people habitually do what other people won't do. They go where others won't go because there's a lot less competition and a much greater chance for success.

5. They start at the end...

Average success is often based on setting average goals.

Decide what you really want: to be the best, the fastest, the cheapest, the biggest, whatever. Aim for the ultimate. Decide where you want to end up. That is your goal.

Then you can work backwards and lay out every step along the way.

Never start small where goals are concerned. You'll make better decisions--and find it much easier to work a lot harder--when your ultimate goal is ultimate success.

6. ... and they don't stop there.

Achieving a goal--no matter how huge--isn't the finish line for highly successful people. Achieving one huge goal just creates a launching pad for achieving another huge goal.

Maybe you want to create a $100 million business; once you do you can leverage your contacts and influence to create a charitable foundation for a cause you believe in. Then your business and humanitarian success can create a platform for speaking, writing, and thought leadership. Then...

The process of becoming remarkably successful in one field will give you the skills and network to be remarkably successful in many other fields.

Remarkably successful people don't try to win just one race. They expect and plan to win a number of subsequent races.

7. They sell.

I once asked a number of business owners and CEOs to name the one skill they felt contributed the most to their success. Each said the ability to sell.

Keep in mind selling isn't manipulating, pressuring, or cajoling. Selling is explaining the logic and benefits of a decision or position. Selling is convincing other people to work with you. Selling is overcoming objections and roadblocks.

Selling is the foundation of business and personal success: knowing how to negotiate, to deal with "no," to maintain confidence and self-esteem in the face of rejection, to communicate effectively with a wide range of people, to build long-term relationships...

When you truly believe in your idea, or your company, or yourself then you don't need to have a huge ego or a huge personality. You don't need to "sell."

You just need to communicate.

8. They are never too proud.

To admit they made a mistake. To say they are sorry. To have big dreams. To admit they owe their success to others. To poke fun at themselves. To ask for help.

To fail.

And to try again.

So today - I am changing my goal - I am going to set up a business by which everyone can make money from their mobile phone.

This business will require no skill set and no equipment apart from a smartphone, a 3G connection and a wish or desire to sell.

The app (as it will be an app) will cost less than a week of benefit payments, so anyone could save up the money from scratch to buy into it. £49.99.

And the business plan will aim to make you double that a week for 12 weeks.

What it will be .... is for another blog :)

And my goal is to help 1300 people with this application by the end of 2013.

Tuesday 6 November 2012

Creativity: Is Creativity A Mental Illness? Is society mental?

A really good article and set of ideas - not from me - but popped down here for you - and as a place for me to come back to when not so busy being creative for clients.

And extra interesting as battling with my own ego at the moment after watching Revolver (again and quite by accident) - which has boogled my mind.

The reporter which this article is taken from - recently came across a link that was called – ‘creativity ‘closely entwined with mental illness’. This was from the bbc website about a recent study that has connected creativity with mental health problems. The link can be found here - http://www.bbc.co.uk/news/health-19959565.

And after reading all that was said, I thought I would use my creativity to write an article about this. As I don’t believe that this is a discovery that is either new or groundbreaking; associating these two things together has been done for a very long time.

This also reminded me of a book by Alice Miller and the title gives away much of what the book is about - The Untouched Key: Tracing Childhood Trauma in Creativity and Destructiveness. And the Publication Date for this book was 1990.

Society

One of the things that society likes to do is to label things. And in the area of the mind or mental health, this could relate to a certain type of behaviour or the mental tendencies that one might have.

I said the type of behaviour first, because this is typically how one comes to understand what is going on in another person’s mind. So this will then result to certain behaviour being classed as normal or abnormal, based on the criterion that has been set by the people in mental health and other such figures.

Normal Or Abnormal?

As time has gone by, it is clear to see, that what is classed as normal and what is classed as abnormal, is constantly changing. What was classed as normal many years ago could be classed as abnormal today. These descriptions are never static and are always changing - like life itself.

The ego mind functions through making judgements; this is how it hopes to ensure its own survival. It does not mean that these judgements are right or wrong or true or false, they are just how the ego mind works.

And due to the ego mind seeing everything in polarities, it will mean the judgements that are made, will be seen as the absolute truth.

Consequences

No matter what one is talking about in regards to making judgements, there will always be consequences that occur through this act. And when it comes to the area of mental health, there are potentially two sides.

On one side there is the obvious motivator to assist in making people’s lives better and to aid in the betterment of their wellbeing. And by becoming aware of a certain behaviour or mental position, they will be able to or at least try to provide the appropriate solutions.

And on the other side, there are consequences of not only becoming aware, but of also giving or attaching a label to something. This can end up creating more problems.

Associations

Here, ones ego mind will not only begin to identify with the new label that has been coined, it will also begin to take on board the emotional judgements that come with it. This could be feelings of guilt, shame, anger, frustration, anxiety and/or fear. So if one does feel that they have mental challenges, these can end up being magnified by these labels.

The Four Seasons

In nature there are the different seasons and this effects how the weather is and for some countries this will be more evident than others. Sometimes it’s hot and sometimes it cold, one can change where they live or they can stay and experience the different cycles.

When it comes to the mind, there are similarities. There are moments when it can be like the summer season and there are moments when it can be like the winter season and all that is in-between. And this will naturally vary from person to person. The childhood that one has had, ones physical health, the quality of one’s relationships and their financial situation; are a few examples that will play a part in ones mental wellbeing.

This means that there will be times that one feels good and times when they don’t. The natural ebb and flow of life is at work here. (Of course, if one is constantly feeling low and down, then this is a sign that assistance is the right option and must be sought)

Pleasure And Pain

To avoid pain and to seek pleasure is how the ego mind functions. And being human, means is that we will experience pain, it can’t be avoided. However, what we can change is our interpretation of what is causing the pain. It often seems that anything that is considered to be painful is described as a mental health problem in today’s world.

If one doesn’t feel completely happy all of the time, then there is a label or a term given to these people. And if one is happy a lot of the time, there is even a label for this also. Based on this perspective, it would be easy to say everyone has a mental health problem of some kind, simply because we are human.

The Human Experience

And part of what makes us human, is our ability to feel pain. We navigate our way through life by what our ego mind has associated as painful. The childhood years of a lot of people are extremely painful and for some the years later are equally as painful.

The loved ones in people’s life will pass or they will want to move on, which will bring pain. Rejection and disapproval are but two other ways, which can also create pain.

Creativity

So if pain is part of the human experience and we all need a way to deal with that pain, then what better way is there to process it than to be creative? This is a way to transmute the negative energy and that way, instead of using this energy in a destructive way, it can be used to create something positive.

Destructivity

Another way to describe all this is to say ‘destructivity ‘closely entwined with mental illness’. They are two sides of the same coin. And there are plenty of examples of both. And when it comes to processing the pain that we all have to one degree or another, what is the most constructive?

Conclusion

It can be easy to feel a certain amount stigma around normal parts of the human experience and this can be the result of different influences, from our friends to the experts. The most important thing is to be aware and to question all that is said; so that we can form our own ideas and views.

Pain motivates people to achieve and to develop themselves. The need to have or to achieve is often the result of feeling the absence within. The individual that is content rarely feels motivated to do or be more - A Buddhist monk is an example of this. So based on this perspective, does that mean that a society’s evolution and the human evolution, is the result of mental health problems?

---

An interesting idea - I would counter from my own experience with many of the women in my life have been the reason for my evolution - and I do believe society's too.

Without them us men would be living somewhere hot, wearing next to nothing, weight training and thinking about stuff... kinda like the Greeks ( a few 1000 years ago...)

Tuesday 9 October 2012

Perhaps positive thinking will only do so much....

As ever taken from a great article and popped here so I remember... as I ride my next wave of wonderful creativity, luck, serendipity and positivity - I will be wise to remember.... positive thinking will only do so much.

Lie back and picture life after your ambitions are fulfilled, the motivational gurus used to say, and you'll bring that end result closer to reality. Make an effort to visualize every detail – the finished screenplay sitting pretty on your desk, the gushing reviews in the paper, the sports car parked outside.

The gurus claimed these images would galvanize your determination. They said you could use the power of positive thinking to will success to happen. But then some important research came along that muddied the rosy picture.Gabriele Oettingen's psychology lab at New York University has showed that visualizing our aims as already achieved can backfire. The positive imagery can be inspiring at first but it also tricks the mind into relaxing, as if the hard work is done. This means the more compelling the mental scene of success, the more likely it is that your energy will seep away.

In the study, volunteers felt de-energized after visualizing success in an essay competition. In another, participants who fantasised about their goals for the coming week felt less energetic and achieved fewer of their goals.

Why Picturing Future Obstacles Actually Helps


A related problem with picturing what life will be like after we've achieved our goals is that it encourages us to gloss over the obstacles to success that are standing in our way. While the fantasy about our successful new fashion line or our future gym-fit physique might give us a frisson of excitement, it also distracts us from the practical steps we need to put in place to turn dream into reality. Of course you need to have an end goal in mind – purpose and direction are vital – but just as important is to think hard about the hurdles lying in wait.

Oettingen's team call this strategy "mental contrasting" – thinking about how wonderful it would be to achieve your goals, while paying due attention to where you're at now and all the distance and difficulties that lie in between.


Visualizing our aims as already achieved can backfire.



Two weeks after a group of mid-level managers at four hospitals in Germany were trained in this mental contrasting technique, research by Oettingen's group showed they'd achieved more of their short-term goals than their colleagues who'd missed out on the training, and they found it easier to make planning decisions. That's another benefit of mental contrasting: by thinking realistically about the obstacles to success, it helps us pick challenges that we're likely to win and avoid wasting time on projects that are going nowhere.

Now I know I have done this one more than a few times - but here is the proof to back up my life experiences.

Have a go – think of one of your ambitions, write down three benefits of succeeding, but then pause and consider the three main obstacles in your way, and write those down, too. Going through this routine will help ensure you direct your motivation and energy where it's needed most, and help you identify if this particular goal is a non-starter.

It's worth noting, however, that mental contrasting works best as a counter-point to high morale and expectations of success. When you're feeling confident, it ensures your positive energy is channelled strategically into the tasks and activities that are essential for progress. (If you're feeling low and struggling to get going on any project at all, then this is not the technique for you.)


Positive Feedback as a Multiplier for Progress


One scenario when we're likely to be flush with confidence and optimism is after receiving positive feedback. In a more recent study, Gabriele Oettingen and her colleagues tested the value of mental contrasting in a simulation of just such a situation.

By thinking realistically about the obstacles to success, it helps us pick challenges that we're likely to win and avoid wasting time.


Dozens of volunteers took part in what they thought was an investigation into creativity. Half the study participants were given false feedback on a test of their creative potential, with their results inflated to suggest that they'd excelled. In advance of the main challenge – a series of creative insight problems – some of the participants were then taught mental contrasting: writing about how good it would feel to smash the problems, and then writing about the likely obstacles to achieving that feat, such as daydreaming.

The best performers on the insight problems were those participants who'd received the positive feedback about their potential and who'd performed mental contrasting. They out-classed their peers who'd received inflated feedback but only indulged in positive thoughts, and they outperformed those participants who'd received negative feedback (regardless of whether they, too, performed mental contrasting).

So, the next time you receive some positive feedback, don't lose your focus. Indulge yourself a little – you're on track after all – but also take time to think about the obstacles that remain, and the practical steps you'll need to enact to overcome them. The mental contrasting technique guards against complacency, ensuring the boost of your early win is multiplied into long-term success.

I like it - and I am going to use it from tomorrow :)

Thursday 4 October 2012

I have just joined a new business. Blippar - the world's best mobile augmented reality company (in my eyes...)

I have just joined a new business. Blippar - the world's best mobile augmented reality company (in my eyes...)

Which is one of the reasons why I have joined them - the other was the culture of the place - so exciting and inclusive...

It's a great feeling to be part of an exciting family with a great vision to change the world. It has made me very happy.

So it was with happy interest I read the following this morning

"Happiness--in your business life and your personal life--is often a matter of subtraction, not addition."

Consider, for example, what happens when you stop doing the following 10 things:

1. Blaming.


People make mistakes. Employees don't meet your expectations. Vendors don't deliver on time.

So you blame them for your problems.

But you're also to blame. Maybe you didn't provide enough training. Maybe you didn't build in enough of a buffer. Maybe you asked too much, too soon.

Taking responsibility when things go wrong instead of blaming others isn't masochistic, it's empowering--because then you focus on doing things better or smarter next time.

And when you get better or smarter, you also get happier.

2. Impressing.

No one likes you for your clothes, your car, your possessions, your title, or your accomplishments. Those are all "things." People may like your things--but that doesn't mean they like you.

Sure, superficially they might seem to, but superficial is also insubstantial, and a relationship that is not based on substance is not a real relationship.

Genuine relationships make you happier, and you'll only form genuine relationships when you stop trying to impress and start trying to just be yourself.

3. Clinging.

When you're afraid or insecure, you hold on tightly to what you know, even if what you know isn't particularly good for you.

An absence of fear or insecurity isn't happiness: It's just an absence of fear or insecurity.

Holding on to what you think you need won't make you happier; letting go so you can reach for and try to earn what you want will.

Even if you don't succeed in earning what you want, the act of trying alone will make you feel better about yourself.

4. Interrupting.

Interrupting isn't just rude. When you interrupt someone, what you're really saying is, "I'm not listening to you so I can understand what you're saying; I'm listening to you so I can decide what I want to say."

Want people to like you? Listen to what they say. Focus on what they say. Ask questions to make sure you understand what they say.

They'll love you for it--and you'll love how that makes you feel.

5. Whining.

Your words have power, especially over you. Whining about your problems makes you feel worse, not better.

If something is wrong, don't waste time complaining. Put that effort into making the situation better. Unless you want to whine about it forever, eventually you'll have to do that. So why waste time? Fix it now.

Don't talk about what's wrong. Talk about how you'll make things better, even if that conversation is only with yourself.

And do the same with your friends or colleagues. Don't just be the shoulder they cry on.

Friends don't let friends whine--friends help friends make their lives better.

6. Controlling.

Yeah, you're the boss. Yeah, you're the titan of industry. Yeah, you're the small tail that wags a huge dog.

Still, the only thing you really control is you. If you find yourself trying hard to control other people, you've decided that you, your goals, your dreams, or even just your opinions are more important than theirs.

Plus, control is short term at best, because it often requires force, or fear, or authority, or some form of pressure--none of those let you feel good about yourself.

Find people who want to go where you're going. They'll work harder, have more fun, and create better business and personal relationships.

And all of you will be happier.

7. Criticizing.

Yeah, you're more educated. Yeah, you're more experienced. Yeah, you've been around more blocks and climbed more mountains and slayed more dragons.

That doesn't make you smarter, or better, or more insightful.

That just makes you you: unique, matchless, one of a kind, but in the end, just you.

Just like everyone else--including your employees.

Everyone is different: not better, not worse, just different. Appreciate the differences instead of the shortcomings and you'll see people--and yourself--in a better light.

8. Preaching.

Criticizing has a brother. His name is Preaching. They share the same father: Judging.

The higher you rise and the more you accomplish, the more likely you are to think you know everything--and to tell people everything you think you know.

When you speak with more finality than foundation, people may hear you but they don't listen. Few things are sadder and leave you feeling less happy.

9. Dwelling.

The past is valuable. Learn from your mistakes. Learn from the mistakes of others.

Then let it go.

10. Fearing.

We're all afraid: of what might or might not happen, of what we can't change, or what we won't be able to do, or how other people might perceive us.

So it's easier to hesitate, to wait for the right moment, to decide we need to think a little longer or do some more research or explore a few more alternatives.

Meanwhile days, weeks, months, and even years pass us by.

And so do our dreams.

Don't let your fears hold you back. Whatever you've been planning, whatever you've imagined, whatever you've dreamed of, get started on it today.

If you want to start a business, take the first step. If you want to change careers, take the first step. If you want to expand or enter a new market or offer new products or services, take the first step.

Put your fears aside and get started. Do something. Do anything.

Otherwise, today is gone. Once tomorrow comes, today is lost forever.

Today is the most precious asset you own--and is the one thing you should truly fear wasting.

These wise words came (not from me) but from Jeff Haden who learned much of what he knows about business and technology as he worked his way up in the manufacturing industry. Everything else he picks up from ghostwriting books for some of the smartest leaders he knows in business. @jeff_haden

Definately made me think - as perhaps I spend a little too long doing a couple of these bad things from above. It is my new goal to not :)

Friday 28 September 2012

Can we answer the 10 questions at Enter Mobile.... let's find out....

Doug Richard on his school for startups talks about the 10 business questions.

It's a great way to think about your start up and I heartly recommend (if you can) go on one of his courses.

So I wondered today - how well would EnterMobile - our new idea to bring gamifaction to the nation with low cost brandable mobile games - would stack up against the 10.

1. The Proposition: What do we do that people need or want?

- we provide a fun way for brands to get mobile numbers

2. The Customer and the Market: Who are they?

- bars, resturants, clubs, sports organisations - anyone in high passion / high dwell time sectors.

3. The Channel: How do we reach them?

- at the moment it has been word of mouth and online - we plan to create an app that will be a lost leader as well into the market place.

4. The Pricing Model: How much is it worth?

- we are still working this one out

5. What relationship do they want to have with you?

- a hands off one - our product is a self service platform for some of the options

6. The Partner: Who is our key partner?

- a series of developers from Project Massmob (another start up idea of ours)

7. The Competition: Who are we up against?

- inside the industry: mobile phone games, mobile app developers, mobile companies.

- outside the industry: anything that people do when bored rather than play games.

8. What do we have in common?

- we all love mobile

9. The Asset: What is our key asset?

- the behind the scenes IP of our self service platform and the route to market

10. The Competency: What must we be good at?

- developing games, developing back end, and marketing to our niche (which we are...)

I am hoping that be the time the Window of Opportunity events come along (Doug's heavy hitting and Free events providing a fresh perspective on raising and investing money) we will be ready with the number 4.

Which is kinda key. And what we will be working on next week.

Some more information about the investor events. Windows of Opportunity.What is it all about?

It is well known that banks aren’t lending; equity is scarce; and traditional investment returns can often be poor. Our aim is to demonstrate that there is another way…

Windows of Opportunity is a series of FREE events to inform entrepreneurs, businesses and investors about the new types of money and new investment opportunities that exist today.

Who is it for?

The overarching goal is to make sense of the range of investment and funding options for potential or existing investors and entrepreneurs or young businesses.

Entrepreneurs
Startups
Businesses
New Investors
Established Investors
Angel Investors

So if you are an entrepreneur, a startup, a new or an established investor you can’t afford not to know about this and attend one of these FREE Events!

http://www.schoolforstartups.co.uk/woo/


Who says I don't do anything for you :)

And could you therefore do something for me? And check out EnterMobile - all about creating branded mobile games for people - and give me your thoughts on it - and heck maybe even go social on it too and tell you peeps :)

Tuesday 25 September 2012

Not the power of phones - but the power of intention

My iphone broke the other week - nothing amazing there - as over 2 years old.

Which is shocking when you think I am in mobile marketing - but it is interesting to see the phones of other people in the mobile industry - the CEO of Blippar's phone was more beat up than mine - and he runs one of the most successful mobile augmented reality companies in the world. So... it says something.

The point is that my phone broke and a good friend of mine gave me his old phone (another iphone that goodness) as he is off to Bali to do some soul searching.

And it was interesting to see what he left on his phone. On his itunes / ipod or podcasts. Some really spiritual and enlightened works which I was very happy to be reacquainted with.

As my blogs as of late have been a little tech heavy, mainly if not totally about startups and my passion for them, I wanted to pop this in here as well. Nothing to do with marketing. But everything to do with life.

"There is a universal source of energy that is called the “power of intention.” This source – whether you call it God, the divine, or something else – is always available to us and is infinite in its possibilities. - Dr Wayne Dyer

So in his podcast on my best friend's phone who I may never see again was the Seven Faces of Intention. And so I list them here... they are:

Creativity, Kindness, Love, Beauty, Expansion, Unlimited Abundance, and Receptivity - Dr W Dyer believes that they are the keys to unlocking the power of intention in your life. And so do I.

1. Creativity

– Realize that there is creativity within you, and learn to recognize and appreciate your creative impulses. You don’t have to be an artist or a writer – creativity is just as important to the business person looking for the next big idea.

“If you’ve ever felt inspired by a purpose or calling, you know the feeling of Spirit working through you. Inspired is our word for in-spirited.”

Learn to recognize this state of being in-spirited, and you’ll unlock your inner creativity.


2. Kindness

–Whether you call it karma, the law of reciprocity or the power of positive thinking, work from the belief that you’ll be rewarded for good intentions.
Dr. Dyer shares the science behind kindness in The Power of Intention. When you do something kind for someone else, their brain releases serotonin – and so does yours! Serotonin is a hormone that makes us feel good. So, every act of kindness makes two happier people in the world.

“If you want others to be happy, practice compassion. If you want to be happy, practice compassion.”

3. Love

- Think of this power of intention as the face of kindness exponentiation with the emotion of love.

Love means a lack of judgment, a lack of anger or resentment. It means recognizing God in others.

4. Beauty

– The face of beauty is the face of intention.

Learn to appreciate the beauty of everything around you.

The face of beauty is truth, honesty and a knowing that what "is" -- is exactly as it should be. You can use this power by re-framing any negative thoughts you have towards others and replace them with an appreciate (a thankfulness attitude) towards them.


5. Expansion


– Expand your awareness of what is possible.

Don’t set limits on yourself; instead, learn to listen to your intuition.

If you see the world as a negative and hurtful place, then you’re only ever going to experience it that way. Instead, learn to recognize your true nobility.
“True nobility isn’t about being better than someone else, it’s about being better than you used to be.”


6.Unlimited Abundance


– Realizing your unlimited abundance means facing down your fears and limitations. Dr. Dyer has a simple three-word suggestion for how to put this into action:

Act “as if”. This means acting as if the thing you want has already happened.

You were probably taught all of your life about limitations and about what is "not possible." Fortunately, this came from well-meaning people who believed in limitation and not abundance. This law does not require you to be intellectually perfect in order to receive the benefits. Believing in unlimited abundance has no downside, so why not take another look at your business life after you answer this question, "What if I could have it all?"

7. Receptivity

– This means being open without judgment. Being aware enough and engaged enough to see possibilities where others don’t. And most importantly, it means simply relaxing and letting the Power of Intention do its work.

So there you have it - not really about marketing or startups or mobile - but massively important in making sure that they bring you what you intend... not just what you want :)

Resources:
http://www.selfgrowth.com

Monday 24 September 2012

Ever think we might be in Startup Purgatory: No Man’s Land

Again nothing from my own thinking - this is PURELY a work by another - but it is sooooo good I don't change or add to it.

It's the Only Two Ways To Build A $100 Million Startup. By Boris Wertz, Version One Ventures.

Read more: http://versiononeventures.com/the-only-2-ways-to-build-a-100-million-business/#ixzz27Pct2OgV

With tens of thousands of new start-ups being created every year, the potential of a company to truly scale and become a large, stand-alone business is more crucial than ever before.

A great product is always the foundation but a clear distribution strategy becomes essential to cut through the noise.

So most early-stage VCs have started to evaluate investment opportunities with an imaginary benchmark in mind: can this company become a $100 million opportunity?

Generally speaking, there are two ways (and only two ways) to scale a business to hit that $100 million threshold:

Your business has a high Life Time Value (LTV) per user, giving you the freedom to spend a significant amount of money in customer acquisition. High LTV can usually be found in transactional or subscription businesses.
Your business has a high viral co-efficient (or perhaps even a network effect) that lets you amass users cheaply without worrying too much about the monetization per user or spending money on paid acquisition.

Route One: High LTV per user

The exact definition of a “high” user LTV depends on the specific vertical, so it’s typically better to analyze the ratio between Customer Acquisition Costs (CAC) and the Life Time Value of the customer. In my experience, having an LTV that’s three to four times greater than CAC makes a business (and potential investment) interesting.

The biggest driver for high LTV is repeat purchase behavior (in an e-commerce business) respectively a low churn rate (in a SaaS company). Companies that score highest in this criteria are typically: E-commerce businesses that fulfill regular needs and offer a differentiated experience or SaaS businesses that help businesses or individuals manage core activities.

As a VC, the biggest challenge in evaluating LTV models is that metrics can dramatically change at scale. For example, Customer Acquisition Costs often increase once the more efficient marketing channels are maxed out and the company needs to find new users through less efficient means. In addition, churn tends to rise as a company grows. Early users of a product are often strong advocates and company ambassadors, while those users acquired through paid marketing channels down the road show far less loyalty.

Route Two: The Viral Effect

The other way to scale a business is through a strong viral and/or network effects that lets businesses grow to tens of even hundreds of millions of users. With this model, user acquisition is generally close to free, and monetization per user is often low (advertising-based or freemium businesses).

Many businesses built in the early days of the Facebook platform (like Zynga) benefitted from a huge viral co-efficient and scaled very rapidly. (As we all know, this is no longer the case as Facebook has essentially removed most of the free viral channels and businesses must now pay for most of their user acquisition via Facebook.)

Even more interesting are businesses that create network effects like marketplaces or social networks. Not only do they acquire lots of users for free due to viral effects but also create important barriers to entry and lock-in effects as the network grows over time.

Startup Purgatory: No Man’s Land

Unfortunately, many consumer internet startups find themselves stuck in the middle of these two strategies: they have a low monetization per user and limited viral effects. That unfortunate combination makes it rather difficult to reach the $100M mark.

As the consumer Internet space becomes more and more crowded, every startup founder needs to be thinking about these two ways to scale a business. Too often I have seen entrepreneurs believe that customers will automatically flock to their cool new service, completely underestimating how tough it is to cut through the noise and build an audience.

To build a standalone company and capture the attention of investors, you need a viable way to scale your business. The earlier you figure this out the better, since it may require you to build your product differently. While the $100 million mark may seem far away in those early days, it’s important to begin thinking about paths to reach this threshold from the start.

Read more: http://versiononeventures.com/the-only-2-ways-to-build-a-100-million-business/#ixzz27PbywRrO

Start ups and Growth .... what you might need to know...

This is PURELY taken from someone else - I put it here only so I can remember it more and click back to it when I am in Malaysia.

The blog is by - Paul Graham. And it is wonderful.

Startup = Growth

September 2012

A startup is a company designed to grow fast. Being newly founded does not in itself make a company a startup. Nor is it necessary for a startup to work on technology, or take venture funding, or have some sort of "exit." The only essential thing is growth. Everything else we associate with startups follows from growth.

If you want to start one it's important to understand that. Startups are so hard that you can't be pointed off to the side and hope to succeed. You have to know that growth is what you're after. The good news is, if you get growth, everything else tends to fall into place. Which means you can use growth like a compass to make almost every decision you face.

Redwoods

Let's start with a distinction that should be obvious but is often overlooked: not every newly founded company is a startup. Millions of companies are started every year in the US. Only a tiny fraction are startups. Most are service businesses—restaurants, barbershops, plumbers, and so on. These are not startups, except in a few unusual cases. A barbershop isn't designed to grow fast. Whereas a search engine, for example, is.

When I say startups are designed to grow fast, I mean it in two senses. Partly I mean designed in the sense of intended, because most startups fail. But I also mean startups are different by nature, in the same way a redwood seedling has a different destiny from a bean sprout.

That difference is why there's a distinct word, "startup," for companies designed to grow fast. If all companies were essentially similar, but some through luck or the efforts of their founders ended up growing very fast, we wouldn't need a separate word. We could just talk about super-successful companies and less successful ones. But in fact startups do have a different sort of DNA from other businesses. Google is not just a barbershop whose founders were unusually lucky and hard-working. Google was different from the beginning.

To grow rapidly, you need to make something you can sell to a big market. That's the difference between Google and a barbershop. A barbershop doesn't scale.

For a company to grow really big, it must (a) make something lots of people want, and (b) reach and serve all those people. Barbershops are doing fine in the (a) department. Almost everyone needs their hair cut. The problem for a barbershop, as for any retail establishment, is (b). A barbershop serves customers in person, and few will travel far for a haircut. And even if they did the barbershop couldn't accomodate them. [1]

Writing software is a great way to solve (b), but you can still end up constrained in (a). If you write software to teach Tibetan to Hungarian speakers, you'll be able to reach most of the people who want it, but there won't be many of them. If you make software to teach English to Chinese speakers, however, you're in startup territory.

Most businesses are tightly constrained in (a) or (b). The distinctive feature of successful startups is that they're not.

Ideas

It might seem that it would always be better to start a startup than an ordinary business. If you're going to start a company, why not start the type with the most potential? The catch is that this is a (fairly) efficient market. If you write software to teach Tibetan to Hungarians, you won't have much competition. If you write software to teach English to Chinese speakers, you'll face ferocious competition, precisely because that's such a larger prize. [2]

The constraints that limit ordinary companies also protect them. That's the tradeoff. If you start a barbershop, you only have to compete with other local barbers. If you start a search engine you have to compete with the whole world.

The most important thing that the constraints on a normal business protect it from is not competition, however, but the difficulty of coming up with new ideas. If you open a bar in a particular neighborhood, as well as limiting your potential and protecting you from competitors, that geographic constraint also helps define your company. Bar + neighborhood is a sufficient idea for a small business. Similarly for companies constrained in (a). Your niche both protects and defines you.

Whereas if you want to start a startup, you're probably going to have to think of something fairly novel. A startup has to make something it can deliver to a large market, and ideas of that type are so valuable that all the obvious ones are already taken.

That space of ideas has been so thoroughly picked over that a startup generally has to work on something everyone else has overlooked. I was going to write that one has to make a conscious effort to find ideas everyone else has overlooked. But that's not how most startups get started. Usually successful startups happen because the founders are sufficiently different from other people that ideas few others can see seem obvious to them. Perhaps later they step back and notice they've found an idea in everyone else's blind spot, and from that point make a deliberate effort to stay there. [3] But at the moment when successful startups get started, much of the innovation is unconscious.

What's different about successful founders is that they can see different problems. It's a particularly good combination both to be good at technology and to face problems that can be solved by it, because technology changes so rapidly that formerly bad ideas often become good without anyone noticing. Steve Wozniak's problem was that he wanted his own computer. That was an unusual problem to have in 1975. But technological change was about to make it a much more common one. Because he not only wanted a computer but knew how to build them, Wozniak was able to make himself one. And the problem he solved for himself became one that Apple solved for millions of people in the coming years. But by the time it was obvious to ordinary people that this was a big market, Apple was already established.

Google has similar origins. Larry Page and Sergey Brin wanted to search the web. But unlike most people they had the technical expertise both to notice that existing search engines were not as good as they could be, and to know how to improve them. Over the next few years their problem became everyone's problem, as the web grew to a size where you didn't have to be a picky search expert to notice the old algorithms weren't good enough. But as happened with Apple, by the time everyone else realized how important search was, Google was entrenched.

That's one connection between startup ideas and technology. Rapid change in one area uncovers big, soluble problems in other areas. Sometimes the changes are advances, and what they change is solubility. That was the kind of change that yielded Apple; advances in chip technology finally let Steve Wozniak design a computer he could afford. But in Google's case the most important change was the growth of the web. What changed there was not solubility but bigness.

The other connection between startups and technology is that startups create new ways of doing things, and new ways of doing things are, in the broader sense of the word, new technology. When a startup both begins with an idea exposed by technological change and makes a product consisting of technology in the narrower sense (what used to be called "high technology"), it's easy to conflate the two. But the two connections are distinct and in principle one could start a startup that was neither driven by technological change, nor whose product consisted of technology except in the broader sense. [4]

Rate

How fast does a company have to grow to be considered a startup? There's no precise answer to that. "Startup" is a pole, not a threshold. Starting one is at first no more than a declaration of one's ambitions. You're committing not just to starting a company, but to starting a fast growing one, and you're thus committing to search for one of the rare ideas of that type. But at first you have no more than commitment. Starting a startup is like being an actor in that respect. "Actor" too is a pole rather than a threshold. At the beginning of his career, an actor is a waiter who goes to auditions. Getting work makes him a successful actor, but he doesn't only become an actor when he's successful.

So the real question is not what growth rate makes a company a startup, but what growth rate successful startups tend to have. For founders that's more than a theoretical question, because it's equivalent to asking if they're on the right path.

The growth of a successful startup usually has three phases:

There's an initial period of slow or no growth while the startup tries to figure out what it's doing.

As the startup figures out how to make something lots of people want and how to reach those people, there's a period of rapid growth.

Eventually a successful startup will grow into a big company. Growth will slow, partly due to internal limits and partly because the company is starting to bump up against the limits of the markets it serves. [5]

Together these three phases produce an S-curve. The phase whose growth defines the startup is the second one, the ascent. Its length and slope determine how big the company will be.

The slope is the company's growth rate. If there's one number every founder should always know, it's the company's growth rate. That's the measure of a startup. If you don't know that number, you don't even know if you're doing well or badly.

When I first meet founders and ask what their growth rate is, sometimes they tell me "we get about a hundred new customers a month." That's not a rate. What matters is not the abolute number of new customers, but the ratio of new customers to existing ones. If you're really getting a constant number of new customers every month, you're in trouble, because that means your growth rate is decreasing.

During Y Combinator we measure growth rate per week, partly because there is so little time before Demo Day, and partly because startups early on need frequent feedback from their users to tweak what they're doing. [6]

A good growth rate during YC is 5-7% a week. If you can hit 10% a week you're doing exceptionally well. If you can only manage 1%, it's a sign you haven't yet figured out what you're doing.

The best thing to measure the growth rate of is revenue. The next best, for startups that aren't charging initially, is active users. That's a reasonable proxy for revenue growth because whenever the startup does start trying to make money, their revenues will probably be a constant multiple of active users. [7]

Compass

We usually advise startups to pick a growth rate they think they can hit, and then just try to hit it every week. The key word here is "just." If they decide to grow at 7% a week and they hit that number, they're successful for that week. There's nothing more they need to do. But if they don't hit it, they've failed in the only thing that mattered, and should be correspondingly alarmed.

Programmers will recognize what we're doing here. We're turning starting a startup into an optimization problem. And anyone who has tried optimizing code knows how wonderfully effective that sort of narrow focus can be. Optimizing code means taking an existing program and changing it to use less of something, usually time or memory. You don't have to think about what the program should do, just make it faster. For most programmers this is very satisfying work. The narrow focus makes it a sort of puzzle, and you're generally surprised how fast you can solve it.

Focusing on hitting a growth rate reduces the otherwise bewilderingly multifarious problem of starting a startup to a single problem. You can use that target growth rate to make all your decisions for you; anything that gets you the growth you need is ipso facto right. Should you spend two days at a conference? Should you hire another programmer? Should you focus more on marketing? Should you spend time courting some big customer? Should you add x feature? Whatever gets you your target growth rate. [8]

Judging yourself by weekly growth doesn't mean you can look no more than a week ahead. Once you experience the pain of missing your target one week (it was the only thing that mattered, and you failed at it), you become interested in anything that could spare you such pain in the future. So you'll be willing for example to hire another programmer, who won't contribute to this week's growth but perhaps in a month will have implemented some new feature that will get you more users. But only if (a) the distraction of hiring someone won't make you miss your numbers in the short term, and (b) you're sufficiently worried about whether you can keep hitting your numbers without hiring someone new.

It's not that you don't think about the future, just that you think about it no more than necessary.

In theory this sort of hill-climbing could get a startup into trouble. They could end up on a local maximum. But in practice that never happens. Having to hit a growth number every week forces founders to act, and acting versus not acting is the high bit of succeeding. Nine times out of ten, sitting around strategizing is just a form of procrastination. Whereas founders' intuitions about which hill to climb are usually better than they realize. Plus the maxima in the space of startup ideas are not spiky and isolated. Most fairly good ideas are adjacent to even better ones.

The fascinating thing about optimizing for growth is that it can actually discover startup ideas. You can use the need for growth as a form of evolutionary pressure. If you start out with some initial plan and modify it as necessary to keep hitting, say, 10% weekly growth, you may end up with a quite different company than you meant to start. But anything that grows consistently at 10% a week is almost certainly a better idea than you started with.

There's a parallel here to small businesses. Just as the constraint of being located in a particular neighborhood helps define a bar, the constraint of growing at a certain rate can help define a startup.

You'll generally do best to follow that constraint wherever it leads rather than being influenced by some initial vision, just as a scientist is better off following the truth wherever it leads rather than being influenced by what he wishes were the case. When Richard Feynman said that the imagination of nature was greater than the imagination of man, he meant that if you just keep following the truth you'll discover cooler things than you could ever have made up. For startups, growth is a constraint much like truth. Every successful startup is at least partly a product of the imagination of growth. [9]

Value

It's hard to find something that grows consistently at several percent a week, but if you do you may have found something surprisingly valuable. If we project forward we see why.

weekly yearly
1% 1.7x
2% 2.8x
5% 12.6x
7% 33.7x
10% 142.0x

A company that grows at 1% a week will grow 1.7x a year, whereas a company that grows at 5% a week will grow 12.6x. A company making $1000 a month (a typical number early in YC) and growing at 1% a week will 4 years later be making $7900 a month, which is less than a good programmer makes in salary in Silicon Valley. A startup that grows at 5% a week will in 4 years be making $25 million a month. [10]

Our ancestors must rarely have encountered cases of exponential growth, because our intutitions are no guide here. What happens to fast growing startups tends to surprise even the founders.

Small variations in growth rate produce qualitatively different outcomes. That's why there's a separate word for startups, and why startups do things that ordinary companies don't, like raising money and getting acquired. And, strangely enough, it's also why they fail so frequently.

Considering how valuable a successful startup can become, anyone familiar with the concept of expected value would be surprised if the failure rate weren't high. If a successful startup could make a founder $100 million, then even if the chance of succeeding were only 1%, the expected value of starting one would be $1 million. And the probability of a group of sufficiently smart and determined founders succeeding on that scale might be significantly over 1%. For the right people—e.g. the young Bill Gates—the probability might be 20% or even 50%. So it's not surprising that so many want to take a shot at it. In an efficient market, the number of failed startups should be proportionate to the size of the successes. And since the latter is huge the former should be too. [11]

What this means is that at any given time, the great majority of startups will be working on something that's never going to go anywhere, and yet glorifying their doomed efforts with the grandiose title of "startup."

This doesn't bother me. It's the same with other high-beta vocations, like being an actor or a novelist. I've long since gotten used to it. But it seems to bother a lot of people, particularly those who've started ordinary businesses. Many are annoyed that these so-called startups get all the attention, when hardly any of them will amount to anything.

If they stepped back and looked at the whole picture they might be less indignant. The mistake they're making is that by basing their opinions on anecdotal evidence they're implicitly judging by the median rather than the average. If you judge by the median startup, the whole concept of a startup seems like a fraud. You have to invent a bubble to explain why founders want to start them or investors want to fund them. But it's a mistake to use the median in a domain with so much variation. If you look at the average outcome rather than the median, you can understand why investors like them, and why, if they aren't median people, it's a rational choice for founders to start them.

Deals

Why do investors like startups so much? Why are they so hot to invest in photo-sharing apps, rather than solid money-making businesses? Not only for the obvious reason.

The test of any investment is the ratio of return to risk. Startups pass that test because although they're appallingly risky, the returns when they do succeed are so high. But that's not the only reason investors like startups. An ordinary slower-growing business might have just as good a ratio of return to risk, if both were lower. So why are VCs interested only in high-growth companies? The reason is that they get paid by getting their capital back, ideally after the startup IPOs, or failing that when it's acquired.

The other way to get returns from an investment is in the form of dividends. Why isn't there a parallel VC industry that invests in ordinary companies in return for a percentage of their profits? Because it's too easy for people who control a private company to funnel its revenues to themselves (e.g. by buying overpriced components from a supplier they control) while making it look like the company is making little profit. Anyone who invested in private companies in return for dividends would have to pay close attention to their books.

The reason VCs like to invest in startups is not simply the returns, but also because such investments are so easy to oversee. The founders can't enrich themselves without also enriching the investors. [12]

Why do founders want to take the VCs' money? Growth, again. The constraint between good ideas and growth operates in both directions. It's not merely that you need a scalable idea to grow. If you have such an idea and don't grow fast enough, competitors will. Growing too slowly is particularly dangerous in a business with network effects, which the best startups usually have to some degree.

Almost every company needs some amount of funding to get started. But startups often raise money even when they are or could be profitable. It might seem foolish to sell stock in a profitable company for less than you think it will later be worth, but it's no more foolish than buying insurance. Fundamentally that's how the most successful startups view fundraising. They could grow the company on its own revenues, but the extra money and help supplied by VCs will let them grow even faster. Raising money lets you choose your growth rate.

Money to grow faster is always at the command of the most successful startups, because the VCs need them more than they need the VCs. A profitable startup could if it wanted just grow on its own revenues. Growing slower might be slightly dangerous, but chances are it wouldn't kill them. Whereas VCs need to invest in startups, and in particular the most successful startups, or they'll be out of business. Which means that any sufficiently promising startup will be offered money on terms they'd be crazy to refuse. And yet because of the scale of the successes in the startup business, VCs can still make money from such investments. You'd have to be crazy to believe your company was going to become as valuable as a high growth rate can make it, but some do.

Pretty much every successful startup will get acquisition offers too. Why? What is it about startups that makes other companies want to buy them? [13]

Fundamentally the same thing that makes everyone else want the stock of successful startups: a rapidly growing company is valuable. It's a good thing eBay bought Paypal, for example, because Paypal is now responsible for 43% of their sales and probably more of their growth.

But acquirers have an additional reason to want startups. A rapidly growing company is not merely valuable, but dangerous. If it keeps expanding, it might expand into the acquirer's own territory. Most product acquisitions have some component of fear. Even if an acquirer isn't threatened by the startup itself, they might be alarmed at the thought of what a competitor could do with it. And because startups are in this sense doubly valuable to acquirers, acquirers will often pay more than an ordinary investor would. [14]

Understand

The combination of founders, investors, and acquirers forms a natural ecosystem. It works so well that those who don't understand it are driven to invent conspiracy theories to explain how neatly things sometimes turn out. Just as our ancestors did to explain the apparently too neat workings of the natural world. But there is no secret cabal making it all work.

If you start from the mistaken assumption that Instagram was worthless, you have to invent a secret boss to force Mark Zuckerberg to buy it. To anyone who knows Mark Zuckerberg that is the reductio ad absurdum of the initial assumption. The reason he bought Instagram was that it was valuable and dangerous, and what made it so was growth.

If you want to understand startups, understand growth. Growth drives everything in this world. Growth is why startups usually work on technology—because ideas for fast growing companies are so rare that the best way to find new ones is to discover those recently made viable by change, and technology is the best source of rapid change. Growth is why it's a rational choice economically for so many founders to try starting a startup: growth makes the successful companies so valuable that the expected value is high even though the risk is too. Growth is why VCs want to invest in startups: not just because the returns are high but also because generating returns from capital gains is easier to manage than generating returns from dividends. Growth explains why the most successful startups take VC money even if they don't need to: it lets them choose their growth rate. And growth explains why successful startups almost invariably get acquisition offers. To acquirers a fast-growing company is not merely valuable but dangerous too.

It's not just that if you want to succeed in some domain, you have to understand the forces driving it. Understanding growth is what starting a startup consists of. What you're really doing (and to the dismay of some observers, all you're really doing) when you start a startup is committing to solve a harder type of problem than ordinary businesses do. You're committing to search for one of the rare ideas that generates rapid growth. Because these ideas are so valuable, finding one is hard. The startup is the embodiment of your discoveries so far. Starting a startup is thus very much like deciding to be research scientist: you're not committing to solve any specific problem; you don't know for sure which problems are soluble; but you're committing to try to discover something no one knew before. A startup founder is in effect an economic research scientist. Most don't discover anything that remarkable, but some discover relativity.









Notes

[1] Strictly speaking it's not lots of customers you need but a big market, meaning a high product of number of customers times how much they'll pay. But it's dangerous to have too few customers even if they pay a lot, or the power that individual customers have over you could turn you into a de facto consulting firm. So whatever market you're in, you'll usually do best to err on the side of making the broadest type of product for it.

[2] One year at Startup School David Heinemeier Hansson encouraged programmers who wanted to start businesses to use a restaurant as a model. What he meant, I believe, is that it's fine to start software companies constrained in (a) in the same way a restaurant is constrained in (b). I agree. Most people should not try to start startups.

[3] That sort of stepping back is one of the things we focus on at Y Combinator. It's common for founders to have discovered something intuitively without understanding all its implications. That's probably true of the biggest discoveries in any field.

[4] I got it wrong in "How to Make Wealth" when I said that a startup was a small company that takes on a hard technical problem. That is the most common recipe but not the only one.

[5] In principle companies aren't limited by the size of the markets they serve, because they could just expand into new markets. But there seem to be limits on the ability of big companies to do that. Which means the slowdown that comes from bumping up against the limits of one's markets is ultimately just another way in which internal limits are expressed.

It may be that some of these limits could be overcome by changing the shape of the organization—specifically by sharding it.

[6] This is, obviously, only for startups that have already launched or can launch during YC. A startup building a new database will probably not do that. On the other hand, launching something small and then using growth rate as evolutionary pressure is such a valuable technique that any company that could start this way probably should.

[7] If the startup is taking the Facebook/Twitter route and building something they hope will be very popular but from which they don't yet have a definite plan to make money, the growth rate has to be higher, even though it's a proxy for revenue growth, because such companies need huge numbers of users to succeed at all.

Beware too of the edge case where something spreads rapidly but the churn is high too, so that you have good net growth till you run through all the potential users, at which point it suddenly stops.

[8] Within YC when we say it's ipso facto right to do whatever gets you growth, it's implicit that this excludes trickery like buying users for more than their lifetime value, counting users as active when they're really not, bleeding out invites at a regularly increasing rate to manufacture a perfect growth curve, etc. Even if you were able to fool investors with such tricks, you'd ultimately be hurting yourself, because you're throwing off your own compass.

[9] Which is why it's such a dangerous mistake to believe that successful startups are simply the embodiment of some brilliant initial idea. What you're looking for initially is not so much a great idea as an idea that could evolve into a great one. The danger is that promising ideas are not merely blurry versions of great ones. They're often different in kind, because the early adopters you evolve the idea upon have different needs from the rest of the market. For example, the idea that evolves into Facebook isn't merely a subset of Facebook; the idea that evolves into Facebook is a site for Harvard undergrads.

[10] What if a company grew at 1.7x a year for a really long time? Could it not grow just as big as any successful startup? In principle yes, of course. If our hypothetical company making $1000 a month grew at 1% a week for 19 years, it would grow as big as a company growing at 5% a week for 4 years. But while such trajectories may be common in, say, real estate development, you don't see them much in the technology business. In technology, companies that grow slowly tend not to grow as big.

[11] Any expected value calculation varies from person to person depending on their utility function for money. I.e. the first million is worth more to most people than subsequent millions. How much more depends on the person. For founders who are younger or more ambitious the utility function is flatter. Which is probably part of the reason the founders of the most successful startups of all tend to be on the young side.

[12] More precisely, this is the case in the biggest winners, which is where all the returns come from. A startup founder could pull the same trick of enriching himself at the company's expense by selling them overpriced components. But it wouldn't be worth it for the founders of Google to do that. Only founders of failing startups would even be tempted, but those are writeoffs from the VCs' point of view anyway.

[13] Acquisitions fall into two categories: those where the acquirer wants the business, and those where the acquirer just wants the employees. The latter type is sometimes called an HR acquisition. Though nominally acquisitions and sometimes on a scale that has a significant effect on the expected value calculation for potential founders, HR acquisitions are viewed by acquirers as more akin to hiring bonuses.

[14] I once explained this to some founders who had recently arrived from Russia. They found it novel that if you threatened a company they'd pay a premium for you. "In Russia they just kill you," they said, and they were only partly joking. Economically, the fact that established companies can't simply eliminate new competitors may be one of the most valuable aspects of the rule of law. And so to the extent we see incumbents suppressing competitors via regulations or patent suits, we should worry, not because it's a departure from the rule of law per se but from what the rule of law is aiming at.

Thanks to Sam Altman, Marc Andreessen, Paul Buchheit, Patrick Collison, Jessica Livingston, Geoff Ralston, and Harj Taggar for reading drafts of this.