Posted by: T.D. Inoue | May 5, 2011

Be true to yourself

I just wrote this internal memo to my dev team and realized that I wanted to share this with others to help them avoid making one of  the biggest mistakes I made as an entrepreneur. As I note in the memo, I have very few regrets in life, but the ones I do have relate to not being true to myself. I have slightly edited this from the original memo, but it is largely as-written.

I have, as we Americans say: “baggage” from my previous company and management experience.

One of the biggest mistakes I made in my first company was that I did not fight hard enough for things that I felt strongly about. I promised that I would not make that mistake again.

But there are battles not worth fighting, and I promised that I would not waste my, or anybody else’s time fighting tiny battles. After all, we are all mature adults, capable of making decisions. Sometimes I will agree, sometimes I won’t, but as long as everybody understands where the company is trying to go and we reach our important goals, I don’t want myself or anybody else to dictate the specific path if it really doesn’t matter in the big picture.

I believe Google operates like this. And while I don’t agree with some things they do, I do agree with this philosophy.

Now to my war story.

Read More…

Advertisements
Posted by: T.D. Inoue | April 28, 2011

Starting a company with you spouse

I’ve heard that VC’s hate investing in companies started by married teams because success rates are so low. This is understandable because marriages are hard enough without the added stress of a startup. Throw that into the mix and you’re asking for trouble!

So why, against our better judgement, did my wife and I do this?

To start with, it would have been impossible not to start the company together. Evy is the marketing and people whiz. I’m the geek with big ideas. Our skill-sets are complementary. Plus, at our age (we’re almost 50), there’s no way that either of us would have let the other start a venture like this without the other. When you’re living a startup 24/7, which you really have to if you want to succeed, the last thing a spouse wants is to be out of the loop. One partner would end up feeling neglected and the other would feel held back. It’s a recipe for disaster. So we took the plunge and dove into this together.

I won’t lie – it’s not easy!

Since I’ve been through the startup experience before, I was pretty well prepared for the full immersion it involves. I warned Evy that it would be more consuming than she could imagine. And yet, she agreed to go through with it. Having this understanding from the start is key. If one partner is working round the clock and the other wants to work 9-5, that would doom the venture and the marriage. Being on the same page here is a requirement. Read More…

Posted by: T.D. Inoue | April 23, 2011

A thousand forks in the road

Now that we’re on the other side of a major decision point, we can get back on track to handle more mundane issues like actually creating our business. Fortunately, at the same time my mind got made up, our potential business partners affirmed our decision. In fact, changing direction opened a lot of doors that would have been closed to us while simultaneously eliminating most of the huge headaches we were looking at. It’s great when things go your way!

As a startup, we’re going to have a lot of decisions to make, and while most won’t be “make-or-break” type decisions, I think the sum of these decision is what results in success vs. failure. It’s a case of the whole is greater than the sum of the parts. It’s like a cross-country trip. If I make a few wrong turns, I can correct the course and get to my destination. But if I fail to correct, I can miss the destination by thousands of miles. I think this is why agile companies with tight feedback loops can be so successful. They adapt to various obstacles and correct their courses based on live conditions that would be impossible to predict beforehand. Entrepreneurial legends Mark Suster and Bill Gross discuss this in a great interview, here. Listen about 30 minutes in. Great stuff. It reminds of one of Mark’s earlier posts on JFDI.

A startup can become a cult of personality. In some cases, that’s great, because you need someone passionate about building great products or providing amazing service. But, it can also be dangerous if someone has too much ego and is unwilling to change course when faced with evidence showing that the destination is undesirable.

As CEO, I have a vision for where I want OurKudos to go. I certainly have an ego and can be quite forceful in pushing us towards goals that are consistent with that vision. However (I think) that I’m pretty good at listening to the people that I’ve entrusted to do the real work in the company. If they tell me that some idea is stupid, I’ll take that seriously, and if their criticism still makes sense after we discuss it, I’ll adapt and change course.

Another thousand forks in the road lie ahead…

We make a myriad of decisions every day, but some represent “crossroads” for the business – decisions that profoundly affect the direction of the business. These are big, scary decision because you think that if you’re wrong, it can destroy the business.

At times like these, I believe the secret to making the appropriate decision lies in referring back to the reason why you started in the first place. I ask myself: “How does this decision mesh with our core mission?”

When viewed in this light, the answer may be easy. It can take a tough, emotional issue and strip it down to the basics – is this consistent with who we are and what we’re fundamentally trying to do?

At OurKudos, our mission is to “celebrate the good in the world” – we are all about raising the public awareness about good. We are a celebration of life and the people who make a positive impact on us. So you would think that our decisions would be easy. Not so!

Read More…

Posted by: blzabub8 | April 15, 2011

what makes someone lucky and some thoughts on creativity

Recently I ran across this article which has some great insights, including excerpts from an interview with Steve Jobs:

What Lucky People Do Differently

In the article, a premise is floated that lucky people think of themselves as lucky because of a certain personality tendency which makes them less goal-oriented thinkers and more open to the myriad possibilities of life, including all its uncertainties. Unlucky people end up identifying themselves as unlucky, perhaps due to the opposite tendency: the unbending pursuit of a specific imagined outcome which causes them to miss out on all the other possible outcomes which might have been just as good or even better, or just different but still valuable.

This led me to some thoughts on creative thinking. I believe our educational system and society at large enforce a certain type of learning. A teacher, with a room full of students, gives an assignment, which is identical for each student, and asks for the assignment to be completed at a certain date and time. Each student attempts to complete the assignment at the appointed time. The teacher then evaluates the student’s performance based on whether the student completed the assignment and did they do it on time. Rinse and repeat this process ten thousand times and we have the bulk of our educational system. I think this leads to adult workers with two kinds of rigid thought:

1) Work consists of assignments or tasks from a boss or authority figure which must be completed based on the criteria provided by the boss and within the allotted time. Accept the task, complete the task, report completion of the task. This leaves out a lot of possibilities which might be superior: challenge the value or necessity of the assignment, offer an alternative (hopefully superior) task to the one assigned, break the loop into smaller increments: before completing the assignment show progress in increments and ask for feedback before continuing. A teacher may not be able to listen to feedback from all 30 students in a class, but when it’s just you and your co-worker or boss, why not take more, smaller steps?

2) Thinking at work is about getting to an endpoint. Like taking a test, it involves starting at one place and trying to reach a desired outcome in the most direct, shortest time possible, with the least amount of meandering, distracting thoughts, daydreaming, etc. The vast majority of people in this world go about their lives completing one task and then another and so forth. There is certainly a need for work to be completed in this fashion. But what really changes the equation, re-frames the question, perhaps even causes a revolution that can change a workplace or the world at large, is people who think differently, who reject the premise sometimes, who (to use a cliche) value the journey as much as the destination.

To ameliorate this type of  rigid thinking, I have a couple of ideas: teams should work on finding the right pace for work, review and feedback loops. If the cycles are too long, people sprint down the wrong path and by the time reviews take place, lots of wasted work occurs. If the cycles are too short, we spend all our time going through approvals and we end up micromanaging and not letting people exercise their autonomy. So some customization based on team chemistry, experience and project requirements is probably warranted.

Hiring really bright and talented people and letting them exercise agency in a flat management structure is another way to relieve this type of rigid thinking. Encouraging entrepreneurialism, getting people to buy into the mission and allowing them to have ownership over areas pushes us to let go of a rigid, near-sighted mindset.

Reject the Premise! and how that leads to critical thinking, the alternative to rigid thinking: I could never imagine myself back 31 years ago in Mrs. Cortellessa’s 3rd grade class rejecting an assignment from her and telling her that it was a boring exercise or poorly written and lacked clear criteria or was not effective in teaching a concept. Most of us plodded through school, always accepting the premise of what was asked of us, everything from a lengthy project or assignment to the simplest question on a quiz, most of us automatically began thinking about the answer to the question. Some of us were bright enough to think about the “expected” answer to the question, rather than any objective answer to the question, but how many of us rejected the question outright? Enough of this type of thinking and you grow up into a classic worker drone, just doing what’s in front of you without asking why.

What we really want and need are critical thinkers. And understanding that we can reject the premise of a question or assignment is the beginning of critical thinking. This kind of brings me full circle to the original article and the psychological study conducted in it. Those who rated themselves as lucky performed better in the study test because they sort of by their nature rejected the premise of the test. They did not try and complete it as it was explained. They saw an “out”, a way to shortcut the test which was perfectly within the bounds of the test and they took it. So maybe the habit of rejecting the premise of something, of looking outside the box, can lead not just to critical thinking, better thinking, but to luckier, happier,  more meaningful lives!

Posted by: OurKudos | April 15, 2011

Returns policies are contentious and scary!

Zappos is famous for having a “no-hassle” return policy that includes refunding the customers’ shipping charges. This creates “no-risk” purchasing for their customers. It is also said to create “fans” out of potentially unhappy customers. The idea is that these now-happy customers will buy more in the future and tell their friends about their great experiences with Zappos.com.

Given their amazing success in spite of very high return rates, they must be doing something right! The question is “does it work for other businesses?”

We are going through these discussions internally. I’ve long been a believer in the high “lifetime value” of a customer, having seen the value of happy customers in my past businesses. Happy customers become your best marketing tool and buy more in the future. To me, it’s obvious – treat your customers well and they’ll reward you with loyalty, future business and invaluable word-of-mouth referrals.

The other side of the argument is that it’s too speculative and hard to quantify customer goodwill, while it’s easy to calculate losses due to paying customers’ shipping charges for returned items. Sell 1,000 items that cost $10 each way to ship and you’ve “lost” $20,000 before you’ve even included restocking fees and so on. Those are scary numbers for the bean counters because they’re so easy to prove.

And so these discussions get very contentious. I argue for highly liberal customer return policies while my more conservative partners cite “industry standard” policies requiring customers to pay their own shipping costs. Arguments get ugly because it’s all very scary with the pros being speculative while the cons are concrete.

In our case, I’ve calculated that if a happy customer who returns an item results in 2.5 more sales in the future, we break even compared with an unhappy customer who returns an item and never buys another from us. Those are hard numbers based on a given return rate, cost of shipping, etc. etc.

What have you found to be the case? Do happy customers actually buy much more than those who have a neutral or negative experiences? Have you quantified this? If so, what has been your experience?

Posted by: OurKudos | April 13, 2011

What’s all this about balance?

I’ve been reading the excellent management blog “On leadership and social networking“, by Susan Wright-Boucher. While reading, I came across a post and active discussion on balance which made me reflect on my own balance.

Having done the startup thing before, when my wife suggested that we start a business, I warned her that it would not be easy. Of course she knew this, but I felt an obligation to emphasize that this was not something to go into lightly. To paraphrase, I said “a startup is a voracious beast that threatens to swallow you whole – consuming any bit of your time that you do not defend as your own.” Read More…

Posted by: OurKudos | April 11, 2011

Who is our competition?

As we ‘old folks’* say “when I was young and naive”, when people asked me about my competition, I would say we had none, or maybe one direct competitor. In those days, my company made one of the only real-time video image processing systems. In our niche market, we really had very few direct competitors. We owned that field.

But who is our competition? Let’s look at the real competitors we had during the mid 1980’s.

We had a disruptive technology. Until that time, most people in our target market were using film and 35mm cameras or movie cameras. Because we were trying to shift the market from using film to video, we were actually competing with companies like Nikon and Kodak – companies with entrenched technologies.

Who else were we competing with? In a sense, we were competing with the status quo – people used their eyes for many observations, so we were competing with a “free” solution to the problem.

Fortunately, we did indeed have a disruptive technology that was so compelling, that early adopters were willing to spend $50,000 for our product! And then, when we brought the price down to $17,000 a few years later we achieved even greater market penetration. But still, compared to 35mm cameras and film, our was a premium solution. We didn’t know who are real competition was.

*I’m around 47 now, definitely old by internet startup standards.

Today, I see things with much wider open eyes. Competition is all around. Our product could consider all the big players as competition on some level – Google, Facebook, Twitter, Foursquare. Even email could be considered a competitor.

Read More…

Posted by: OurKudos | April 10, 2011

What makes a great hire?

The last post was mostly on why you want great people in your organization. In this one, I ask “what makes a great hire?”

My perspective on this is somewhat contrarian. Unlike Google, I’m not looking for PhD’s or Ivy leaguers because I don’t really think that’s indicative of success. Sure, you’ve got to be well above average “book intelligence” to be either of those things, but does that guarantee that you’ll be a great addition to the team?

I’ll be honest, I’m an Ivy leaguer and one other person on our small team is as well, but I don’t think that has much to do with success. I saw plenty of classmates who were brilliant at theory but lousy at actually doing anything in the real world. To me, the name on the diploma means nothing.

Read More…

Posted by: OurKudos | April 9, 2011

Finding great people

Mark Suster, famed entrepreneur and VC, recently published an article on TechCrunch called “9 Women Can’t Make a Baby in a Month.” In it, he discussed the problem of over-capitalization and how it leads funded companies to make poor hiring decisions. He made a lot of other good points, but that’s the one that resonated with me, leading me to comment on the article:

Mark, I’m in complete agreement. Having created and run a lean startup in the 80’s, I found that having a small, very talented development team allowed us to be ‘agile’ way before anybody knew the word. Many times, people suggested that we take outside funding and grow explosively, but I insisted on organic growth. My feeling was that if the company didn’t have the sales to grow, it didn’t deserve to do so.

Sticking to the lean-and-mean philosophy won. Multi-billion dollar companies failed to compete against us because they just threw bodies at the problem. Give me a half dozen ‘A’ players any day – I’ll gladly take on 100 ‘C’ players with a huge budget. I’m maintaining this philosophy with my new startup and am throttling hiring to ensure we only have an all ‘A’ staff.

This highlights my view on hiring – hire a small number of really great people and help them to help you create an amazing company.

Read More…

« Newer Posts - Older Posts »

Categories